Manufacturers seek tariff relief

VARIOUS commodity manufacturers, including cement-makers, flour millers and bakers’ groups, trooped to the Tariff Commission last Friday, seeking relief amid the economic slowdown.

During a public hearing held by the Commission, Vincent Castillo 3rd, Cement Manufacturers Association of the Philippines Inc. (Cemap) operations manager, said cement is a strategic commodity, thus meriting its transfer to the country’s ‘sensitive’ list.

While local manufacturers want to revert the duty slapped on cement, they do not necessarily oppose importation, Castillo said.

“We are not against importation of cement per se, but importation of cement that are not conforming to Philippine standards and undervalued,” he added.

Ric Pinca, Philippine Association of Flour Millers Inc. director, said in the same hearing that millers want the extension of zero duty on flour for another six months to maintain the current levels of bread prices.

Pinca said locally milled flour is sold at between P760 and P780 per sack, down from a peak of P970 in June last year. “The flour milling industry has passed on to consumers the savings of the millers due to the zero tariff on wheat,” he said, adding that bakeries have in turn also slashed bread prices due to the decreasing flour prices.

Pinca however said global wheat prices are expected to rise in the coming months as the weather remains unpredictable in wheat-producing countries. While wheat can be purchased for $300 per metric ton in January, the price shot up to $400 last month, he said. “The past days have seen wheat prices hit the roof. If you buy wheat now, based on [Thursday’s] closing of the futures market, which will come in three months after in the Philippines, you’ll see that wheat prices have gone up roughly 30 percent compared to January,” he added.

Bakers’ groups earlier said they are amenable to the extension of the zero tariff on wheat, but want the imposition of a zero duty on flour as well, to further bring down bread prices. Flour importers who attended the public hearing supported the bakers’ petition.

In a letter to acting commissioner Edgardo Maralit, flour importer Manildra Group said a zero tariff on flour: will benefit consumers as they can purchase wheat flour products, bread, pan de sal, biscuits and noodles at lower prices.

Richard White, Manildra group representative, told reporters on the sidelines of the public consultation that another P50 reduction on flour prices can be expected if this commodity will also enjoy zero duty.

Ernesto Chua of flour importer Malabon Longlife Trading Corp. said there is a wide gap between the zero tariff on wheat and the prevailing 7-percent most-favored nation (MFN) duty on flour.

Trade Undersecretary Zenaida Maglaya told reporters also on Friday that the Trade government is still studying the various requests before it makes recommendations to the Cabinet-level inter-agency Committee On Tariff And Related Matters (TRM).

The six-month implementation of zero tariff on flour and cement, under Executive Order 765 and EO 766, respectively, is set to expire on June 21, during which the MFN rates of 3 percent on flour and 5 percent on cement can be reverted back unless the TRM recommends otherwise. –Ben Arnold O. de Vera, Reporter, Manila Times