MANILA, Philippines — The extended reduced tariffs on pork imports may raise the level of the Philippines’ pork imports this year to 400,000 metric tons (MT), according to the United States Department of Agriculture (USDA).
In a report by its Foreign Agricultural Service, the USDA said the new forecast was higher than the initial projection of 375,000 MT of pork imports for this year.
The USDA attributed the upward adjustment to the recent issuance of Executive Order 171, which imposes lower tariffs on pork imports until the end of the year.
EO 171, signed by President Duterte on May 21, extends the lower tariffs on pork under EO 134, which was signed last year, aimed at bringing down prices and stabilizing the supply of pork in the country.
EO 134 reduced the most favored nation (MFN) tariff rates for in-quota pork imports or those under the minimum access volume (MAV) to 10 percent for three months and was increased to 15 percent in the remaining months. This is lower than the original rate of 30 percent.
In contrast, out quota pork imports were slapped with a
20-percent tariff for the first three months, which were raised to 25 percent in the remaining months. This is lower than the original tariff of 40 percent.
Under EO 171, the 15 percent in-quota and 25 percent out quota tariff rates for pork will be extended until Dec. 31.
While the reduced tariffs were extended, the USDA stressed that no changes were made to the MAV which remained at 54,210 MT since February, unlike the 200,000 MT additional MAV for pork imports issued in 2021 under EO 133.
“The government’s relative half-measure to improve market access in 2022 compared to 2021 is likely to offer only minimal and brief relief to consumers given the relatively still high in-quota duty rate and no expansion of the in-quota volume,” the USDA said.
The report pointed out that pig and pork prices have resumed their increase since the short-term effects of temporary, more favorable market access conditions wore off at the end of 2021 and shortly before it, the peak Christmas consumption season.
“More recently, higher feed and fuel prices have and are likely to contribute to higher production costs,” the USDA said.
In an earlier report, the USDA said that while pork prices did decline in the months following the issuance of the additional MAV and lower tariffs last, prices began to rise again in November 2021, mainly due to high gasoline prices, increasing demand toward the Christmas holiday season; and policies that prevented the full utilization of pork MAV and disruptive meat labeling requirement.
Latest market monitors from the Department of Agriculture (DA) showed that the prevailing price of pork kasim or pork ham in Metro Manila markets stood at P350 a kilo on Friday, while pork belly or liempo prices registered at P390 a kilo.
The prevailing prices are higher than the P320 per kilo price of kasim and P370 per kilo liempo exactly a year ago, based on DA data.
Pork producers slammed earlier the decision of the government to extend the lower tariffs, saying it may even push back the recovery of the country’s hog industry from African swine fever (ASF).
“The whole swine industry is saddened by the issuance of the new Executive Order (EO 171) by President Duterte extending low tariffs for pork imports. This will push back recovery efforts of the hog industry as it will definitely affect the sector’s confidence to reinvest for increased production output,” Pork Producers Federation of the Phils. Inc. president Rolando Tambago told The STAR in an earlier Viber message.
This sentiment was also echoed by National Federation of Hog Farmers Inc. president Chester Warren Tan who said that the new EO may discourage hog raisers to go into production.
“While we understand the need for more affordable pork retail prices for the consumers, the previous EO 134, which was issued in May last year, did not deliver its promise of cheaper pork. I am confident consumers can expect the same result from this new EO. Government will lose huge potential tax revenue due to tariff cuts without tangible benefits to the consumers,” Tambago said.
Moreover, the USDA said it is retaining its Philippine pork production forecast for this year at one million MT.
“The industry is continually hesitant to rebuild stocks despite the government’s best efforts to encourage repopulation amidst the continuing threat of ASF infection and the absence of a locally available vaccine,” the USDA said.
In recent follow-up reports submitted to the World Organization for Animal Health, the Philippines reported 199 new ASF cases in the Visayas and Mindanao as well as 51 in Luzon.
Based on the reports, outbreaks are ongoing in the provinces of Leyte and Northern Samar, both in the Visayas.
In Mindanao, provinces with ongoing outbreaks include Agusan del Norte, Misamis Oriental, North Cotabato and Surigao del Sur.
Cagayan, Camarines Norte, Camarines Sur, Ifugao, Isabela, Marinduque, Mountain Province, Nueva Ecija, Nueva Vizcaya and Quezon are among provinces in Luzon with ongoing cases.
The newly reported cases brought the total number of infections to 10,068 since the virus was first detected in the country in 2019.