Hog raisers, meat processors should do importation

I’m humbly calling on our leaders and policy-makers to find the best solution to the prevailing high pork prices, and make it as simple as possible.

all know what the root cause of the problem is: There’s a huge supply gap because of the big drop in our swine population (estimated at 3 million heads as of February 2021 compared to 2020 levels, or a 24-percent drop) due to culling and the death of pigs that were infected with the African swine fever (ASF).

So what should we do? Let’s approach this in a very simple manner.

The supply shortage can be addressed by importation. Everyone agrees to this.

I also agree with the government’s stand that we temporarily increase the current minimum access volume (MAV) to around 400,000 metric tons (MT) from 54,000 MT. I also support the temporary lowering of tariffs to 5 percent to 10 percent. Both of these actions will result in lower pork prices in the market.

But who should do the importation, the traders?

No! Why? Simple: the traders were not the ones who were severely affected by the ASF but the hog raisers.

So, instead of the commercial importers, the government should let the hog raisers—probably through their cooperatives—do the importation of pork. In doing this, we are also solving another problem, which is the economic situation of our hog raisers. The Land Bank of the Philippines or Development Bank of the Philippines can provide loans to the hog raisers or their cooperatives so they can do the importation.

The profit that they will gain from this endeavor will not only alleviate their financial condition amid the pandemic, it will also give them the needed capital to buy piglets and other inputs so they can restock their swine inventory.

This will also erase the problem of finger-pointing, or finding the

one who should take the blame if the shortage and high prices of pork will persist because the hog raisers will be solely responsible for the supply and pricing in the market.

The banks, on the other hand, need not worry about loan defaults because as the loan providers, they can keep track of the transactions, including arrival, deliveries, and payments.

Aside from the hog raisers, who should be allowed to benefit from the increase in MAV?

I say, the meat processors. Again, this is very practical. Meat processors are also affected by the supply shortage, and their woes are also being felt by the Filipino consumers.

The worst that the government can do at this time is to give these importation privileges to traders who did not really lose anything because of the Asf-triggered supply shortage.

But learning from experience, we should also be wary of the possibility that the hog raisers or their cooperatives will just surrender their right to import to the traders for a fee. This happened in the case of rice when there was also a supply shortage years back.

Let’s just make sure this will not happen again.

Again, let’s find the simplest and most practical approach to this problem so the people who are adversely affected will immediately feel the benefits. These are the hog raisers, the meat processors, and the consumers.

Dr. Jesus Lim Arranza is the chairman of the Federation of Philippine Industries and Fight Illicit Trade; a broad-based, multisectoral movement intended to protect consumers, safeguard government revenues and shield legitimate industries from the ill effects of smuggling.