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Philippines extends the 2024 reduced tariff rates 
 
By Doug Schmitz
Iowa Correspondent

AMES, Iowa – Philippines President Ferdinand Marcos Jr. recently signed an executive order extending reduced tariff rates for the third consecutive year on imported pork, corn and rice until Dec. 31 of this year.
“U.S. producers, packers and exporters can use the opportunity provided by this decision to develop deep relationships, and a strong reputation,” Gene Noem, past president of the National Pork Board, and Ames farmer, told Farm World.
“This provides a path for growing the volume and value of U.S. pork to a country that, in my opinion, is poised to grow in consumption,” he added. “They will value the high-quality product U.S. pork producers provide.”
Under Marcos’ executive order (number 50), the reduced tariffs were extended to keep food prices stable due to the expected negative effect of the El Niño weather phenomenon, and the continuing presence of African swine fever affecting domestic pork production.
“All export markets are important to the U.S. pork industry, and Asia is important because the average age in the smaller Pacific Rim countries is very low,” Noem said. “For example, in the Philippines, half of the population is under 26 years of age, pork represents tradition in most of these countries, and swine production has been challenged due to swine diseases like African swine fever.”
According to a statement by the National Pork Producers Council, “The Philippines is an important Asian market for the U.S. pork industry. With more than 109 million people and a cultural preference for pork, the island nation is a top 10 market for U.S. pork exports. The country’s lower tariffs on pork imports have helped spur significant increases in U.S. pork exports there.”
The executive order was published Dec. 26, 2023, and took effect immediately upon publication in the Official Gazette of the Philippines.
Moreover, the executive order maintains tariff rates for imports of swine meat or pork at 15 percent within the minimum access volume quota (the quantities of a given imported agricultural product that the government allows entry into the Philippines at the lower in-quota tariff rate (the tariff applied on imports within a tariff-rate quota), and 25 percent outside the quota (which does not set any limit on the quantity or value of an imported product, but instead applies a different, normally higher, tariff rate to that product), the USDA said.
The tariff rates for corn will be kept at 5 percent in-quota, and 15 percent out-of-quota. Tariff rates for imports of rice will remain at 35 percent for both in-quota and out-of-quota.
In May 2021, in response to a shortage of pork caused by African swine fever, the Philippines lowered its import duties from 30 percent, and 40 percent, respectively; it also increased the quota amount, known as the minimum access volume, to 254,210 metric tons, from just 54,210 metric tons.
Under the lower tariffs and higher minimum access volume, the USDA said U.S. pork exports to the Philippines increased to a record $205 million in 2021, a nearly 79 percent hike.
But after the increased quota amount expired Jan. 31, 2022, exports fell that year to just under $135 million, and for 2023, they will likely be about $120 million. Those amounts were significantly higher than they historically have been, the USDA said.
Chad Hart, Iowa State University professor of agricultural economics and extension economist, told Farm World at a time when the pork industry is struggling financially, any market is an important market.
“Export growth is part of the recipe to improved financial conditions,” he said. “Southeast Asia, including the Philippines, has the potential to substantially grow for pork exports, given the dual forces of population and income growth in the region. The Philippines could grow into a top 10 market for U.S. pork.
“The move to extend the reduced rates should continue to allow expansion of pork exports to the Philippines, along with growth in other export sales for the other commodities under the reduced tariff rates,” he added. “The very early data for 2024 show that boost in exports expanding into the new year.”
Noem said, “This all points to a country seeking a reliable supply of quality pork at the time requested. The U.S. industry has demonstrated the ability to provide the consistency, quality and type of products their trading partners want. The demand in the Philippines and the U.S. pork industry capabilities are a great match right now.”
He added, “This announcement has additional importance since the U.S. is ranked third for the Philippine’s imports with less than 20 percent of the market share. The EU (European Union) is currently the largest supplier, and if the reported herd reductions in the EU are true, there is room for growth in U.S. exports to the Philippines.”
1/23/2024