Turkish flour traders to maintain import level

Despite anti-dumping duty

Turkish flour imports will continue to account for 8- 9 percent of total flour supply into the country as exporters can live with the average 4 percent anti-dumping duties imposed on them by the government.

Ernesto Chua Co Kiong, owner of flour trader Malabon Long Life Trading and chairman of Philippine-Turkish Business Council, told reporters over the weekend that Turkish flour importers and exporters got a better deal with the Tariff Commision's definitive anti-dumping duty than the provisional anti- dumping duty imposed by the Agriculture Department in April this year.

The Agriculture secretary had imposed in April this year an average provisional anti-dumping duty of 39 percent, which already lapsed last October 2. It was significantly higher than the average 4 percent definitive anti-dumping duty for regular exporters while the maximum anti-dumping duty rate was only 16 percent.

"We can live with it. We are happy because it is better than the provisional anti-dumping duty. The 4 percent average is acceptable," Chua said.

Aside from the acceptable antidumping duty, Turkish flour traders would benefit from the increasing prices of US wheat, which is being used by local flour millers. Locally milled wheat flour has a price range

720 to 750 per bag, higher than the equivalent Turkish flour of only 600 to 620.

Local flour millers have their own fighting brand to compete with Turkish flour, but of limited supply only.

With these factors working in their favor, Chua said Turkish flour importers are confident they can still continue bringing in the same volume of supply and maintain its share of between 8 to 9 percent of total local flour demand.

Importers also appreciate the Commission's decision to impose uniform anti-dumping duty for each exporter regardless of how many kinds of flour he exports because it would easier to implement.

Their only problem though is the $ 600 additional cost per 20- foot container van as a result of the port congestion. This add on cost would make the 25 kilogram bag of flour 30 to 40 more expensive.

Chua, however, said they can still absorb the higher logistical cost. If ever, he said, prices may be adjusted in January next year yet but it would be lower than the locally milled flour.

Turkish soft flour, which is used for the manufacture of noodles, biscuits, lumpia wrapper etc, is being sold for 600 to 620 per bag.

Turkish flour importers have already shipped around 90,000 MT from January to September this year. They àlso have a window from October 3 up to the last week of this month up to early December to ship in flour without the anti dumping duty but just the 7 percent regular duty on imposed on flour from Turkey. The definitive anti- dumping duty is expected to take effect late this month or early December.

At the outset though, Turkish importers were disappointed because they thought the Tariff Commission was going to dismiss the anti-dumping petition because there was no imminent threat of material injury to the local players because local flour millers had been more profitable in 2013 than 2012, Chua said.

"Local millers are even expanding like San Miguel Flour Mills and Wellington Flour Mills," Chua said.

Chua also noted of conflicting claims by local flour millers of a poor industry average capacity utilization rate of 57 percent which they blamed on Turkish flour imports.