Government urged to renew tariffs on raw materials for animal feed

MANILA, Philippines — An aquaculture feed manufacturer is urging the government to review tariffs imposed on raw materials, particularly corn and wheat, in a bid to temper the cost of animal feed in the country.

In a virtual forum organized by Tugon Kabuhayan yesterday, Oversea Feeds Corp. vice president Christopher Co called for the review of tariffs on raw materials for manufacturing animal feeds.

He said the ideal scenario would be to have no tariffs for all raw materials to be used for feed manufacturing. However, if this is not possible, Co said the government should review the tariffs, at least for corn and wheat, since these are the two major ingredients for animal feed.

“The purpose of this is to help temper the cost of feeds that we use for livestock and aquaculture. It will reflect on the farmgate prices and the purchasing price for consumers,” Co said.

In October last year, the Philippine Association of Feed Millers Inc. (PAFMI) urged the government to lower the tariffs on yellow corn imports to five percent in a bid to prevent the increase in prices of animal feeds.

The country currently has a three-tiered tariff structure on corn, five percent for those from ASEAN member countries, 35 percent for supply falling under the country’s minimum access volume (MAV) commitment under the World Trade Organization (WTO), and 50 percent for the rest.

Apart from the cost of importing the corn and wheat, feed manufacturers said the supply of raw materials is also a concern amid the ongoing Ukraine-Russia conflict.

“Exporters don’t want to ship raw materials right now. They are waiting to see what will happen. This will lead to feed ingredients getting more expensive or go out of stock altogether,” Oversea Feeds Corp. president Carlos Co said.

Tugon Kabuhayan Convenor Asis Perez said wheat is a primary ingredient in the production of bread and other food items, including animal feeds. The common animal feed ingredients include corn, rice bran, copra meal, feed-wheat, cassava, soy bean meal, fishmeal, coconut oil, salt, and assorted vitamins and minerals.

“These raw materials are also imported mainly from the United States, Australia, China, Canada including European countries like Russia and Ukraine. The Philippines also imports some from Southeast Asian countries like Malaysia, Vietnam and Thailand,” Perez said.

For his part, Jeffrey Lindain, supply chain director of local meat shop Fresh Options, said the swine industry has been experiencing several problems even before the Russia-Ukraine crisis erupted.

“There has been a 130 percent price increase in soya. Soya is the top three ingredients in feed aside from yellow corn and wheat. Corn prices in the US went up by 15 percent since last night,”Lindain said.

“Aside from that, we haven’t fully recovered from ASF (African swine fever). We are also facing shortage of raw materials and importation,” he said.

Tugon Kabuhayan said that if the issue on raw materials is not be solved immediately, this would result in higher prices of agricultural products.

“If we don’t act fast, we will have a shortage of feeds. Less feeds means less production in the animal and aquaculture industries. Our country will once again resort to importation of fish and meat. We want to cushion the impact of the Russian-Ukraine war on our industries,” the food security advocacy group said.