Market price

Philippines cuts tariffs and increases pork production quotas to stabilize market price

With pork production in the Philippines heavily affected by African swine fever (ASF), President Rodrigo Duterte issued an executive order temporarily lowering tariff rates for imported pork muscle cuts. The Philippines’ standard tariff rates are among the highest in the world, with cuts of pork imported into the country’s 54,210 metric tonne quota typically subject to a 30% tariff, while imports in excess of the quota are subject to tariffs. at 40%.

As Erin Borror, an economist with the US Meat Export Federation, explains, Duterte’s order lowers the in-quota tariff rate to 5% for a period of three months, and to 10% for the following nine months. For imports outside the quota, the decree lowers the duty rate to 15% for a period of three months, and to 20% for the following nine months. After 12 months, these rates will revert to 30% and 40%, respectively, unless the lower rates are extended.

Borror notes that Duterte also approved a significant increase in the quota threshold from 54,210 metric tonnes to 404,210 metric tonnes. Details are not yet final, but if this recommendation is implemented, most cuts of pork entering the Philippines in 2021 will receive tariff treatment under the quota.

According to the DRGnews report, the Philippines has already adopted retail price caps and other market interventions in an attempt to keep pork affordable, but these measures have been ineffective. Borror says the lower tariff rates will attract more cuts of pork to the market – not only from the United States but also from Canada and European suppliers. While Germany, Poland and other countries where ASF has a presence are not eligible to export to the Philippines, the European countries serving the market are Spain, Denmark, France and the Netherlands.