Farmers start lobbying for 40% MDM tariff
Farmers have urged the government to revert back the 40 percent tariff on mechanically deboned meats as mandated under the World Trade Organization (WTO) agreement which the Philippines had recognized.
The 40 percent tariff on MDM was temporarily adjusted to 5 percent in 2012 as a concession to the quantitative restriction imposed on rice importation. This rate would revert back to 40 percent by January 1, 2021 as stipulated in WTO rules.
“Since we already have a rice tariff law signed by President Duterte, it is high time that the government slap 40 percent tariff on MDM,” said Rosendo So, chairman of Samahang Industriya ng Agrikultura (SINAG).
“Dapat ibalik na ang 40 percent na taripa sa MDM bilang proteksyon sa mga poultry growers natin,” he added.
The Department of Agriculture, in an earlier statement said, It would still write a memorandum to President Rodrigo Duterte to express the position of the agency and agriculture stakeholders on the matter.
Agriculture Undersecretary Segfredo R. Serrano disclosed that the Tariff Commission found that reverting tariffs on MDM imports to its 2012 level of 40 percent would not have a “substantial” economic impact.
He added that the Bangko Sentral ng Pilipinas (BSP) has already factored in the 40-percent tariff on MDM in its inflation forecast.
Citing the BSP’s study, he said the government would still achieve its inflation targets even if the tariff level on MDM imports would go back to its 2012 level which is 40 percent.
“Why would agriculture have to pay just so they could get few more basis points [off] the inflation rate? There is no substantial reason to maintain [the 5 percent tariff],” said Serrano.
Serrano said maintaining the 5-percent tariff on MDM imports would prolong the prejudice to the poultry subsector.
Data from the Department of Trade and Industry (DTI) show that as of November 2018, chicken leg quarter imports reached 61.4 million kilograms (kg), eclipsing the 44.8 million kg which were brought in the whole of 2017.
Separate data from the Bureau of Animal Industry (BAI) show that meat imports climbed 22.7 percent in 2018 to a record 850,000 metric tons (MT) which were mainly used as raw materials for meat processors.
Chicken meat imports alone climbed 18.1 percent in 2018 to 288,202.817 MT from 244,104.419 MT in 2017. Of the total poultry imports, nearly two-thirds were MDM or raw materials for meat processors mainly to produce hotdogs, sausages and chicken nuggets.