DA’s plan to trim import duties on corn enrages local producers
MANILA, Philippines — Criticisms continue to circle the Department of Agriculture (DA) for instituting another pro-importation policy, this time for proposing to slash the tariffs slapped on corn imports from non-Asean countries.
Agriculture Secretary William Dar, under Special Order No. 540, formed a technical working group to consider trimming the country’s yellow corn import duties – a primary raw material in manufacturing animal feeds. The order said this is meant to provide poultry and livestock raisers as well as fishers access to cheap animal feeds.
Currently, yellow corn imports under the minimum access volume are imposed a 35-percent tariff while those outside the MAV quota are levied with a tariff rate of 50 percent. Imports from non-Asean countries are imposed the same tariff as those under the out-quota.
Roger Navarro, president of the country’s largest group of corn producers Philippine Maize Federation (PhilMaize), said the group was surprised by the DA’s move, adding that corn producers were not consulted or informed about the matter.
In a series of text messages to the Inquirer, Navarro aired his group’s grievances to the DA, concluding that the agency’s recent move “will be the final death sentence to the corn industry.”
“In the last two years after rice tariffication law took effect, corn production soared to the point that corn drove agriculture’s total growth. While production was high corn prices were very low, bringing farmers to their knees. It did not translate to high income,” he said.
“There was no compensation to corn farmers despite being the driver of DA’s growth. There was also no government price support even when DA is mandated to do so under RA 7607 or the Magna Carta for Small Farmers,” he added.
“This is not the right time to make such an announcement. We should help our farmers recover from their previous losses. This announcement will discourage them all the more. This should be the role of the government. There are a lot of gaps that we need to address in the corn industry – input, production, stability of prices and supply, mechanization, post-harvest, and storage. Importation should not be the priority,” Navarro further said.
Price monitoring done by the Philippine Association of Feed Millers Inc. showed that prices of local yellow corn as of Aug. 2 ranged between P21 to P22 a kilo from P18 a kilo last July 15.
Navarro said the spike in prices did not happen overnight as it was the result of corn farmers’ weak planting intentions. For the last four cropping seasons, corn prices hit so low because of the reduced demand for the crop, no thanks to the African swine fever and the coronavirus pandemic.
Members of the United Broilers Raisers Association (Ubra) continue to be disappointed with the agency’s policy directions. According to Ubra President Bong Inciong, they opposed the measure and has not heard of other producers requesting the DA to waive the tariffs imposed on imported corn.
“Rather than waste time studying tariff reduction, it would be best to have an ‘Industry Building’ study for the corn-livestock-poultry cluster to encourage production towards import-and-export competitiveness,” he said.
“Right now, the signal from the DA is to import all types of agricultural commodities ostensibly for the benefit of consumers which is a nebulous proposition given the market imperfections at the retail level,” he added.