CORN growers are opposing the proposal of feed millers to review and reduce the tariff on yellow corn imports, arguing that the measure will only benefit a “few” and may even be detrimental to the domestic corn industry.

The broiler raisers, on the other hand, said they will not support any tariff reduction on yellow corn imports unless it is backed by corn growers.

However, a hog growers group leader said they will support a tariff reduction on yellow corn imports on condition that the volume is only the estimated shortfall and their arrival will not coincide with domestic harvest.

“We are opposing PAFMI’s proposal since they are anyway free to import provided that they pay the necessary [tariffs]. Just because of what is happening in the international market, they want to make us as a scapegoat,” Roger V. Navarro, president of the Philippine Maize Federation Inc., told the BusinessMirror.

Navarro noted that yellow corn imports have been dismal this year, forcing feed millers to procure more locally-produced corn, thus, putting pressure on the domestic supply side. Philippine Statistics Authority (PSA) data analyzed by the BusinessMirror showed corn imports from January to July declined by 73.53 percent to 94,951.748 metric tons (MT) from 358,731.465 MT.

On the other hand, PSA data showed yellow corn production in the first half soared to a record level of nearly 3.1 million MT, the first time domestic output breached the 3-MMT level.

PAFMI earlier claimed that “country’s yellow corn importation is now more than what is locally available, and has a more significant impact on consumer foods.” PAFMI urged the government to review the tariff structure, particularly for non-Asean yellow corn imports which are slapped with 50-percent tariff, and consider lowering them, as what neighboring countries are doing now.

The Department of Agriculture (DA) earlier formed a technical working group to study possible reforms in the country’s yellow corn tariff structure, as well as necessary industry support to boost domestic yellow corn productivity.

Navarro lamented that since yellow corn prices have increased this year, feed millers want the government to intervene; but a year ago they were just sitting and enjoying the low prices of yellow corn. The farm-gate price of yellow corn today ranges from P16 to P18 per kilogram, compared to P8 to P9 per kilogram last year.

“When yellow corn prices were at P8 to P9 per kilogram, feed millers did not do anything. Now that they have a problem, and even if they have an option to import anyway, they want us to suffer anew,” he said.

Refuting earlier claims of PAFMI, Navarro said any reduction in the tariff of imported yellow corn or costs of animal feeds will not translate to lower prices of meat products, with only few people in the value chain benefitting from such.

“We are not a cost-plus value chain. These are commodities and ever since any reduction in the feed costs do not translate to reduction in meat prices and yet farmers are always the ones being blamed,” he added.

Elias Jose Inciong, United Broiler Raisers Association (UBRA) president, said they will back the corn sector’s—an allied industry of the broiler sector—position on the matter.

“Anything that is not agreed upon with the corn sector will backfire. If it is something to which the corn sector is not amenable, it will backfire with corn farmers simply shifting their planting intentions,” Inciong told the BusinessMirror.

Inciong said they now get yellow corn at the price of P21 to P24 per kilogram for a bulk order of at least 10 MT. Prices were at P15 to P16 per kilogram earlier this year; and P13 to P16 per kilogram last year, Inciong added.

“I think it’s because production went down plus feed millers had a hard time sourcing feed wheat abroad,” he said. PSA data showed feed January-August wheat imports declined by 21.69 percent to 1.13 MMT from 1.443 MMT last year.

Nonetheless, Inciong agreed with Navarro that any increase in their farm inputs, such as feeds, would not necessarily mean an increase in the retail prices of poultry meat products since its value is determined “by the dynamics of the market.”

Nicanor Briones, chairman of the Pork Producers Federation of the Philippines Inc. and representative of the Agricultural Sector Alliance of the Philippines (AGAP) party-list, said he is fine with the importation of yellow corn at reduced tariffs, as long as they do not coincide with domestic harvest.

Briones, who also has his own feed mill, said they now get yellow corn at prices of P21 to P23 per kilogram at the feed mill level. However, he played down talk of a shortfall in local corn supply. If there was indeed a shortage, then by this time they would have run out of yellow corn to feed their livestock and poultry animals, he said.

“But that’s not the case, we still have corn until this time,” he told the BusinessMirror.

“It is just the traders hoarding and calibrating the release of the yellow corn in the market, therefore raising the price of the commodity,” he added.

PSA data showed the average farm-gate price of yellow corn in the first half grew by almost 4 percent to P12.9 per kilogram from P12.41 per kg recorded last year.

However, the wholesale price of yellow corn in the reference period declined by 18.3 percent year-on-year to P17.32 per kilogram from P21.20 per kilogram, PSA data showed.

But the average retail price of yellow corn expanded by 14 percent to P28.37 per kg from P24.88 per kg in the first half of last year, based on PSA data.

Image courtesy of CEASAR_M._PERANTE_______________

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