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‘Food prices stable with tariffs on MDM’

THE Philippine Association of Meat Processors Inc. (Pampi) has proposed to extend the 5-percent tariff on mechanically deboned meat (MDM) of chicken and turkey from 2023 until 2025.

Representing Pampi, Jerome D. Ong cited keeping the national economy afloat and helping temper the price increase on food as among the reasons behind the local meat processors’ petition to extend the lower tariff rates on chicken and turkey MDMs.

“Pampi’s petition is intended primarily to support the administration’s determined efforts to keep the national economy stable and help control inflation, especially food inflation,” Ong said during a public hearing before the Tariff Commission last Thursday.

Ong said a stable economy will ensure that processed meat manufacturers under as well as those outside of Pampi would be able to continue producing food for the country at affordable prices.

The Pampi official also noted that the 5-percent tariff on MDM helps keep prices of processed meat products “as reasonable as possible.”

“This tariff has been in place for the past 15 years and during those years as most consumers know, prices of processed meat products using MDM as main raw material have been relatively stable,” Ong added.

In fact, Ong stressed that the 5-percent tariff for the past 15 years has contributed to the growth of local processed meat manufacturers, especially small and medium enterprises.

“This is so because MDM is a versatile product that has diverse applications in food manufacturing from hotdogs to canned loaves to siomai [Chinese dumpling],” said Ong.

Aside from economic stability, Ong read the petition saying petitioner also cites other crucial reasons why retaining the 5-percent tariff is “not only necessary but also imperative as well.”

Among these, Ong said, is that “5-percent tariff supports the continued development and growth of the processed meat manufacturing sector even if it is on the high end of the tariffs levied on raw materials in manufacturing because at present, tariff on manufacturing currently ranges from 0 to 3 percent unlike in MDM with a tariff of 5 percent, it ensures the domestic processed meat products using MDM will be competitive in both the domestic and international markets.”

Ong also pointed out that the 40-percent original tariff rate of MDM does not apply in the case of MDM because the product is not commercially produced locally.

“While petitioner recognizes that high tariffs such as the original MFN rate of 40 percent of MDM is resorted to, to protect domestic industries from foreign competition, it should not be applied in the case of MDM because the product is not commercially produced locally,” Ong stressed.

With this, the PAMPI representative said retaining the 5 percent tariff on MDM is “not prejudicial” to any party. In fact, he said it will benefit all sectors of the economy, the government, manufacturers, all partners in the value chain and “above all” the Filipino consumer.

“Therefore, we humbly request the Commission to recommend to [National Economic and Development Authority] NEDA and the President the approval of this petition to continue and retain the 5 percent tariff on MDM chicken and turkey for the period starting January 1, 2023 up to December 31, 2025.”

Former President Rodrigo R. Duterte issued Executive Order (EO) 123 last year that extended the lower tariff rates on chicken and turkey MDMs until December 31,2022. The tariff rate on chicken MDM will revert to 40 percent starting January 1 next year, based on the EO.

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