THE House of Representatives has asked President Duterte to reconsider his recommendation increasing the Minimum Access Volume (MAV) for pork by 350,000 metric tons (MT) and retain the existing 40-percent tariff.
In a statement sent to the BusinessMirror, Agriculture and Food Committee Chairman Mark Enverga of Quezon said the House sent a letter to the Office of the President, through the Presidential Legislative Liaison Office (PLLO), last March 29, 2021.
The letter was signed by Enverga, Speaker Lord Allan Velasco and Committee on Trade and Industry Chairman John Reynald Tiangco of Navotas.
“Allowing importation beyond the shortage and with a lower tariff will cause oversupply not only in Luzon, but also in the Visayas and Mindanao where there is ample supply of pork,” said Enverga.
“The members of the Committees [on Food and Agriculture and House Committee on Trade and Industry] are one with the livestock sector in expressing its opposition to the volume being requested by DA [Department of Agriculture], as industry data and data provided by the Philippine Statistics Authority [PSA] only showed a shortage of 150,275 metric tons,” he added.
Last March 26, 2021, the Palace submitted a letter to the House of Representatives recommending the increase in the MAV for pork by 350,000 MT.
The government has raised its proposed volume of imported pork this year to address the expected local demand for the food item, as African swine fever (ASF) and a series of typhoons hit the local industry. The current MAV is only at 54,000 MT.
“We informed the President of the outcome of the series of hearings conducted by the committees on the various measures relative to the rising food prices, particularly pork prices, where the Department of Agriculture [DA] presented its proposal to increase the MAV by 350,000 metric tons and to reduce in-quota tariff from 30 percent to 5 percent for the first six months and 10 percent for the succeeding six months and out-quota tariff from 40 percent to 15 percent for the first six months and 20 percent for the succeeding six months,” Enverga said.
Keep tariffs
Also, Enverga said the House has asked the President to retain the pork tariffs at 40 percent.
“The committees submit to the plan of importing pork meat that is enough to fill the supply shortage but not with a lower tariff, as local hog producers already find it difficult to compete with the importers under the existing tariff of 40 percent,” he said.
According to Enverga, the plan of lowering tariff can be counterproductive and may have a negative impact on the local hog industry in the long term.
“In view of the foregoing, the House respectfully appealed to the President that we import only the needed volume and that tariff on pork imports be retained at existing rates so as not to further injure our ailing local hog industry,” he added.
Earlier, the National Economic and Development Authority said the Committee on Tariff and Related Matters (CTRM) proposed to immediately lower pork tariffs to 5 percent within the MAV and 15 percent outside the MAV for 3 months, with a slight increase to 10 percent within the MAV and 20 percent outside the MAV for 9 months.
The Neda said these rates are significantly lower than the current 30 percent within the MAV and 40 percent outside the MAV.
Under Republic Act 8178 or the Agricultural Tariffication Act, in case of shortages or abnormal price increases in agricultural products, whose quantitative restrictions are lifted under this Act, the President may propose to Congress, revisions, modifications or adjustments of the MAV.
However, if Congress fails to act after 15 days from receipt of the proposal, the same shall be deemed approved.
“As far as I understand, 15 calendar days, since not specified in Agricultural Tariffication Act, from March 26 so lapses April 9. If im not mistaken,” said Enverga.
Congress went on its Holy Week recess and is scheduled to resume its session on May 17, 2021.
According to a copy of draft guidelines earlier obtained by the BusinessMirror, the Philippines is mulling over allocating half of the proposed MAV plus for pork of 350,000 metric tons to existing licensees, and giving 25 percent each to domestic hog producers and to non-licensees.
The draft said half of the allocation of the three sectors shall arrive on or before June 30, with the next 25 percent arriving between July 1 and September 30. The remaining 25-percent allocation shall arrive between October 1 and January 31, 2022.
The DA through its National Livestock Program, in consultation with the MAV Management Committee (MAV-MC), shall conduct continuous monitoring and assessment of domestic pork supply and demand situation “to determine whether or not there is a need to release the remaining MAV plus allocation.”
Image credits: Bloomberg