Hurt by import surge, farmers seek anti-dumping duties

MANILA, Philippines —   Local farmers want the government to impose anti-dumping duties and penalties on imported rice in a bid to address the undervaluation of the commodity following the new rice regime in the country.

The Federation of Free Farmers (FFF) said an anti-dumping duty could be imposed if the imported commodity is sold at a price lower than its normal value in the exporting country.

It must also be shown that the entry of the dumped product has caused or is threatening to cause injury to a domestic sector.

The anti-dumping duty is equivalent to the difference between the export price and the normal value in the exporting country and is applied on top of the regular tariff.

FFF national manager Raul Montemayor said data released by the Bureau of Customs indicate that the average landed cost of rice imports was only $227 per metric ton compared to between $391 to $422 if based on internationally published prices.

The low valuation of rice imports could have resulted in a tariff revenue loss of P5 billion and may also have contributed to the drastic decline in domestic palay prices.

“Last month, the monitored export price for rice with five percent brokens from Vietnam was $359 per MT. If a shipment arrives in the Philippines with a landed cost of $227 per MT, it is equivalent to an ex-Vietnam export price of only $159 per MT after removing costs for freight and insurance,” Montemayor said.

“This is $200 cheaper than the monitored export price, and this difference can be the basis of the anti-dumping duty that will be charged against the importer in addition to regular tariffs,” he said.

Anti-dumping measures are governed by the Anti-Dumping Act of 1999, patterned after pertinent rules on anti-dumping in the World Trade Organization, wherein the Philippines is a founding member.

Under the law, the agriculture secretary can initiate an anti-dumping investigation and the BOC may provisionally require importers to post a cash bond equivalent to the estimated dumping margin while a thorough evaluation of the anti-dumping complaint is undertaken by the Tariff Commission.

Anti-dumping measures on imports of a particular commodity can be applied for as long as five years from the date of initial imposition.

“With anti-dumping, an importer will be subject to higher anti-dumping duties the larger the undervaluation, no matter what documents are submitted. The law also provides that the license of an importer who is caught dumping can be cancelled, and its officers can be barred from holding positions in any business enterprise in the country,” Montemayor said.

He added that anti-dumping measures may be a more effective deterrent to undervaluation and import surges than the so-called safeguard measures that are being proposed by other groups.

Montemayor said special safeguard duties could be applied only when cumulative imports exceed a trigger volume and only up to the end of the calendar year.

He also emphasized that President Duterte’s recent directive banning rice imports during harvest time could violate some provisions of the Rice Tariffication Law.

The law virtually repealed all laws allowing government officials to reimpose quantitative restrictions on imports, even if temporarily.