DA bans 43 garlic importers

MANILA, Philippines -  The Department of Agriculture (DA) is banning 43 garlic importers following the reported resurgence of a garlic cartel that has been blamed for a recent spike in prices.

Agriculture Secretary Emmanuel Piñol will issue an administrative order banning 43 importers who were supposed to import a total of 70,000 metric tons of garlic for the first six months of 2017 but only imported 19,000 MT.

“We will not allow them to import anymore because at the time when we need them to import, they did not import. And that is the first indication that there is a cartel,” Piñol said in a briefing yesterday.

With the ban, there will still be 111 importers who can supply the 130,000 MT annual national consumption requirement.

The administrative order will also place the issuances of import permits for garlic directly under the Office of the Agriculture Secretary.

The DA’s move came after Sen. Cynthia Villar, chair of the Senate agriculture committee, hit the DA and some of its officials for the resurgence of the cartel, which reduces farmers’ income and weakens the economy.

The Philippines is heavily dependent on the importation of garlic as only seven percent of total consumption is being supplied locally.

The agriculture chief admitted that over the years, the DA has failed to develop the garlic industry and this resulted in smaller volume of production and the rise of a cartel.

“Yes, there is a cartel. There are groups of businessmen who manipulate or control the prices of the commodity to ensure that they make more money,” Piñol said.

“It’s not easy to address because this is an institutionalized problem. The government in the past failed to invest in this, particularly in cold storage facilities which is very important for the industry,” he added.

Piñol also said that importers do not want to comply with their import permits because of the significantly higher price in China, where the Philippines sources a majority of its garlic imports.

He clarified that no official in his department is involved in the garlic cartel after Villar threatened to file charges against those conniving with importers.

“It is not the indiscriminate issuance of permits but because they just don’t want to import as they will not earn much, which is unfair because if you are a legitimate businessman, you will continue to import for the sake of supply,” he explained.?Furthermore, the DA is allocating at least P200 million next year for the development of garlic and onion as it targets to increase local production. The Ilocos and the Cordillera regions are the largest producers of garlic.

“We target to extend loaning programs and establish pilot farms and cold storage facilities in the Visayas and Mindanao,” Piñol said.

The DA eyes to increase local production to at least 50 percent of consumption in the next five years through the expansion of approximately 20,000 hectares of agricultural land.

“How can we possibly stabilize the price with just seven percent production and it’s a seasonal commodity? We have to produce more so the cartel will not be able to control the price,” Piñol said.