Millers won't ask government to extend EO on zero-tariff wheat imports

MANILA, Philippines - Flour millers said yesterday that they will not ask the government to extend Executive Order 818 which allowed the duty-free importation of milling wheat. Previously, the duty for milling wheat was three percent.

“We believe that the one-year zero duty privilege granted to the wheat flour milling sector through two executive orders (EOs 765 and 818) is enough to stabilize the price of flour and flour-based products in the country,” Philippine Association of Flour Millers (PAFMIL) executive director Ric M. Pinca said.

“At the same time, while the zero-duty import privilege tided us over during the period of high world wheat prices due to the shortage of the crop worldwide, world wheat supply and prices have since stabilized resulting in lower wheat import price,” Pinca added.

The wheat flour milling sector has reflected the zero tariff and lower wheat import prices in the cost of flour which has gone down by more than 20 percent since 2008.

From P970 per 25 kg bag in 2008, the exmill price of hard flour is down to only P750 per bag. Soft flour prices similarly went down from P870 per bag to as low as P650 per bag.

Hard flour is used for breads such as pan de sal, monay and loaf bread while soft flour is for pastries, cookies and cakes.

President Arroyo first issued EO 765 in November 2008 granting six-month zero duty milling wheat and feed wheat importation.

When this EO lapsed in July 2009, the President issued EO 818 extending the duty-free milling wheat importation privilege to the flour millers but excluded feedwheat due to the howl raised by corn farmers whose crop competes with feedwheat as a feed component.