Saturday, November 27, 2021

‘Maring’ damage should justify corn importation at lower tariff

SEVERE Tropical Storm Maring’s damage to the country’s total agricultural output should justify the temporary cut in corn import tariff to five percent in order to prevent the expected increase in food prices according to the Philippine Association of Feed Millers Inc. (Pafmi).

For Pafmi, importation is the “best route to take” or the “band aid solution” to the continuously increasing cost of animal feeds in the country, which has been resulting in higher food prices.

Corn currently comprises 60 to 70 percent of the ingredients for the production of animal feeds. This, while the cost of feeds takes up 80 percent of the total production cost for chicken, pork, and other livestock products.

Based on the latest report of the Department of Agriculture’s (DA) Disaster Risk Reduction and Management Council (DRRMC), the damage and losses that the agriculture sector incurred from Maring already stood at P2.3 billion, affecting 79,014 farmers.

For corn, as much as 8,903 metric tons (MT) of production worth nearly P150 million was wiped out, while 8,658 hectares were damaged. This does not yet take into account the medium to long term impact of the typhoon to corn farmers and their farms.

Pafmi said that prices of feed corn have already increased to record highs. Average price in September, for instance, hit P22.88 per kilogram (/kg), reflecting a sharp increase from P15.30/kg in the same month last year.

Prices in the world market have also been rising due to increasing demand for food, feed and energy purposes.

Pafmi said that Maring could result in the deficit for the said commodity and could push prices not just of corn but also animal feeds.

“There is always that concern because even without the storm, we already face an annual deficit due to several factors, including the finite land area where corn can be grown and climate change which devastates crops through drought or storms,” Pafmi said.

“At the moment, Maring was responsible for an estimated over a billion worth of damage to rice and crops. While we continue to hope for corn prices to be stable, we cannot stop the inevitable with all the calamities that come and go in our country,” it added.

The DA is now considering the implementation of “possible reform of the tariff structure for yellow corn and to identify the necessary measures to ensure protection of our corn tillers if the tariff reform is implemented.”

However, the agency is yet to come up with recommendations regarding this matter.

Earlier, Agriculture Secretary William Dar said Maring’s impact to corn output will be considered in terms of coming up a decision on the possible lowering of corn import tariff.

Pafmi said that when it comes to lowering corn import tariff, “the operative word is balance.”

“We in the local feeds industry are always supportive of our local farmers and we are aware of the many constraints that they face year in and year out because of lack of government support. We lament the lack of infrastructure and equipment for our farmers because no matter how much they try, they can only do so much,” Pafmi said.

“However, we see importation as a band aid solution and at the moment, the best route to take albeit temporary. The lowering of tariffs can be another support for us, even as many of us struggle to keep our prices down despite the high prices of our inputs. We can use a portion of the tariffs of our imported meats to help augment infrastructure and equipment for our corn farmers,” it added.


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