Hog farmers press for zero tariff on feeds

The National Federation of Hog Farmers, Inc. (NFHFI) yesterday called on President Arroyo anew to remove tariffs on feed ingredients to lower the cost of production of hog farmers and poultry growers.

The NFHFI, along with the United Broiler Raisers Association (UBRA) and the Philippine Association of Feedmillers (PAFMI), had filed at least two separate petitions with the Tariff Commission for the removal of tariffs on feed ingredients.

PAFMI had initially filed in February this year  a request for a temporary reduction to zero of tariffs of feed ingredients to allow the feedmill industry to recover.

With the growing global food crisis, the NFHFI and UBRA have joined forces with the PAFMI in seeking a complete removal of tariffs to allow the local hog and poultry industry to survive especially at a time when food security has become a big issue.

In a press briefing, NFHFI vice chairman Renato R. Eleria pointed out that the local hog industry, specifically the backyard growers who account for 70 percent of hog production, has not fully recovered from the disease devastation that hit the sector last year.

Commercial hog growers who account for just 30 percent of hog production are recovering much better, Eleria said, adding that the key to the recovery of hog backyard farming is the continued viability of feedmill companies.

The NFHFI official said feedmills support the backyard hog farmers by  providing them with crucial support that include veterinary medications in exchange for buying feeds from the feedmillers.

However, because of the high cost of ingredients, a number of small feedmillers have been forced to shut down, thereby constricting the support needed by backyard growers.

The costs of feed ingredients such as corn, soybean, wheat bran and coconut oil have increased anywhere from 20 percent to 38 percent.

Additionally, crude oil prices also continue to increase affecting transport cost.

Movements in the foreign exchange rate also have to be factored into the cost of production.

Local corn prices, according to Ely Miranda of PAFMI, are currently at P12.50 a kilo, going down slightly because of the recent harvest but is expected to go back up to P13 a kilo by July. Corn comprises 35 percent of total feed cost.

Most feedmillers, Miranda said, are now relying more on domestic corn production as the cost of imported corn has became too high at $350 per metric ton from Argentina and at $360/MT from the United States.

The price of soybean meal, which is one of the primary source of protein for livestock feed, is at a 37-year high.

Soybean meal, which previously cost P13 per kilo now costs P24.50 per kilo, Eleria said.

Copra meal, which is also a source of protein and fiber, now costs P8.60 per kilo as compared to P6.80 per  kilo last month, Miranda said.

The prices of other raw materials such as rice bran (a lower source of fiber and a lower percentage protein but high in starch), coconut oil (source of fat), pollard ( a better source of fiber than rice bran but inferior to copra meal) and even wheat (as a substitute to corn) have all similarly gone up.

Rice bran, known locally as “darak”, now costs P9.50 a kilo, Eleria said, compared to just P8 a  kilo last month. The price of local rice bran has been affected by the increase in palay buying price. The price of vitamins sourced from China has increased 1000 percent.