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Farmers back 4-6 months of tariff review

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By Adrian H. Halili, Reporter

A FOUR-TO-SIX-MONTH review of tariffs imposed on agricultural goods would promise relief for domestic producers against tariffs lowered potentially until 2028, farmers said.

Federation of Free Farmers (FFF) National Manager Raul Q. Montemayor said the more frequent review proposal shortens the review period from the one year the FFF originally proposed for the 15% tariff on rice.

“A review could result in cutting short the implementation period and reverting to 35% or even 50% for shipments exceeding the Minimum Access Volume quota,” Mr. Montemayor said via Viber.

Executive Order (EO) No. 62, signed by President Ferdinand R. Marcos, Jr. last week, formally approved the reduced tariff on rice imports to 15% from 35%, until 2028. It also covers lower tariffs on pork, corn, and mechanically deboned meat.

The EO also called for a review of the tariff schedule every four months to adjust to changes in global prices and supply.

Agriculture Secretary Francisco P. Tiu Laurel, Jr. said last week that he had proposed a shorter period for tariff reviews, following consultations.

In May, the Board of the National Economic and Development Authority approved a plan to lower tariffs on industrial and farm goods, including the further reduction of rice import tariffs.

Jayson H. Cainglet, executive director of the Samahang Industriya ng Agrikultura said that there should be a mechanism for the retraction of the executive order.

“We propose benchmarks for revoking the EO if the price of rice does not fall, and when the farmgate price falls,” Mr. Cainglet said via Viber.

He added that about 500,000 farmers would be affected by the EO due to the decline in farmgate prices of palay, or unmilled rice.

“The executive order was not clear; it did not state what (actions) would be done after a review,” Danilo V. Fausto, president of the Philippine Chamber of Agriculture and Food, Inc. said by phone.

He added that rice farmers could face a potential P10 per kilogram decline in farmgate prices should import tariffs be lowered.

“The traders and rice millers will have to buy (palay or unmilled rice) at a lower price to compete with imported rice,” Mr. Fausto said.

The average farmgate price for palay rose 30.2% year on year to an average of P24.81 per kilo in May, according to the Philippine Statistics Authority.

Mr. Montemayor said issues raised in previous consultations with the Tariff Commission have remained unaddressed.

“In the past, we carried the burden of proving that the tariffs were not effective; I think, it should be the proponents of the tariff cut who should prove that their prescription was effective,” he added.

Roy S. Kempis, a retired professor at the Pampanga State Agricultural University, said the more frequent tariff reviews would make them more responsive to changes in global prices and supply.

“A periodic review and eventual adjustments of rates can adapt to these changes. This makes the tariff regime more realistically set based on how sensitive the changes are in world prices and supply,” Mr. Kempis said via Viber.

The Philippines is expected to import about 4.6 million metric tons (MMT) this year in the face of the lowered tariffs and increased consumption, the US Department of Agriculture reported.

The Philippines has imported 2.23 MMT of rice as of June 13, according to the Bureau of Plant Industry.

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