MANILA, Philippines — Local importers are sounding the alarm over the possible trade disruptions that the delay in the issuance of this year’s minimum access volume (MAV) allocation could cause in the country’s pork and chicken supply.
The Meat Importers and Traders Association (MITA) wrote to Agriculture Secretary Francisco Tiu Laurel Jr. to express its concerns over the delays in this year’s MAV distribution. MITA emphasized that this is the second time since last year that delays were experienced in the distribution of the MAV allocation.
“The delay in the SDP (systematic distribution process) will certainly cause trade disruptions. Importers are concerned of a repeat of last year and orders will be put on hold, delayed or cancelled,” MITA said in its letter that was also sent to other Cabinet Secretaries who sit in the MAV Management Committee.
The MAV is a system that allows the entry of commodities in the country at a lower tariff rate. For example, imported pork within the MAV or also known as in-quota volume are levied with a 15 percent tariff while imports outside MAV or out-quota have a 25 percent tariff.
However, for certain commodities like chicken, the in-quota and out-quota tariff rates have become uniform at 40 percent.
MITA noted that the SDP of the beginning year pool should have been conducted in the first week of January with the publication of the tentative allocations per importer in the following week. Afterwards, the final approved allocation shall be published in time for the start of the MAV year on Feb. 1.
“However to date, the SDP had been scheduled, rescheduled and then cancelled until further notice,” the group said.
MITA urged the DA to allow the MAV secretariat to proceed with the distribution of the beginning year pool. The group also proposed that the provisional MAV import certificates must be issued while the process is-ongoing to prevent trade disruptions.
Sources told The STAR that the cause of the delay in the MAV allocation distribution this year is similar to last year as the Department of Agriculture (DA) seeks to tweak the MAV guidelines to address certain “loopholes” in the system.
The DA is primarily looking at preventing the sale of the pork imported under the MAV system to wet markets as it directly compete with locally produced pork, sources said.
Last year, The STAR reported that the DA delayed the distribution of the pork MAV as it seeks to rationalize the system and opted to release the allocation in tranches. The action was aimed at limiting pork imports to protect domestic producers.
In November last year, MITA disclosed that there are plans from the DA to tweak the MAV guidelines to “favor” processors over traders and “require” traders to sell only through government programs.
The issue surrounding the country’s pork MAV last year reached the World Trade Organization’s Committee on Agriculture with two trade partners – United States and Canada – inquiring about the delays in the release of the import allocations.
The Philippines responded that it acknowledges the delays in the 2024 pork MAV distribution and pointed out that the entire 54,210 metric tons of pork MAV has been fully distributed already as of September last year.