PHL corn imports may go up by 50%–report
The Philippines’s corn imports in marketing year (MY) 2022-2023 may expand by 50 percent to 750,000 metric tons (MT) as importers will try to fill the anticipated supply gap in feed wheat due to the Ukraine-Russia conflict, an international agency said.
“Post forecasts MY 2022/23 corn imports at 750,000 MT, up 250,000 MT from the previous year, due to the disruptions and market uncertainty of feed wheat caused by the Ukraine conflict,” the United States Department of Agriculture-Foreign Agricultural Service in Manila (USDA-FAS Manila) said in its latest report published recently.
The USDA-FAS Manila noted that the country’s corn imports in MY 2021-2022 reached 500,000 MT. The marketing year for corn starts in July and ends in June of the following year.
The agency said higher corn demand from the poultry sector, which is expected to grow by as much as 2 percent, would offset the constrained demand from the livestock sector, which is still reeling from the impact of African swine fever (ASF).
“Moreover, there is an ongoing effort at the Tariff Commission to reduce the MFN [most favored nation] corn tariff rate to 5 percent and raise the Minimum Access Volume to 4 million MT [MMT] to lower the cost of production for pork and poultry,” it said.
“Proponents of the petition note that feed constitutes about 70 percent of the total cost of production, and corn represents half of feed costs. The Tariff Commission held a public hearing on March 18, 2022, with results expected in the coming weeks.”
The USDA-FAS Manila projected that local corn production in MY 2022-2023 would increase by 2.46 percent to 8.3 MMT from 8.1 MMT in the previous MY. The agency attributed the increase to “favorable farm-gate prices tempered with high fertilizer costs.”
It said the Philippines’s total corn consumption in the current MY would expand by 300,000 MT to 9 MMT due to “higher feed wheat prices.” Out of the total estimated corn consumption, about 6.9 MMT would be for animal feeds.
“Post raises MY 2021/22 feed consumption by 200,000 MT due to the disruptions from the conflict in Ukraine reducing feed wheat availability,” it said.
“The Bureau of Animal Industry reported several Highly Pathogenic Avian Influenza outbreaks in January and February 2022, which Post does not expect to affect broiler or layer production.”
The Philippine Maize Federation Inc. (PhilMaize) earlier said it does not see the need to reduce tariffs on corn as local corn is still cheaper than imports from the United States and Brazil.
PhilMaize claimed that the price of local corn nationwide averaged at P21 per kilogram (kg), or P3 lower than the average price of P24.50 per kg for imported corn from the US and Brazil.
“It is rather disturbing why we want to favor other nations’ corn when our own is much cheaper and could help local corn farmers,” PhilMaize said in its position paper on the proposed tariff reduction on imported corn.
Disputing statements from “unidentified self-interest groups,” PhilMaize said there is no empirical study that would show the “direct correlation” between corn prices and prices of meat products in the market.
“Data from the economic studies have shown that there is no empirical direct correlation on corn prices against increases or decreases of meat and poultry prices in the market contrary to claims of the self-interest groups that made the corn industry more vulnerable in the advent of ASF and now implicated in the Russia-Ukraine war.”
BusinessMirror(2022, March 28). PHL corn imports may go up by 50%–report. BusinessMirror. https://businessmirror.com.ph/2022/03/28/phl-corn-imports-may-go-up-by-50-report/