By Bernie Magkilat, Genalyn Kabiling, and Vanne Elaine Terrazola
Manufacturers of basic necessities and prime commodities (BNPC) have agreed in principle to hold off price increases at least in the next three months or up to the end of the year, the Department of Trade and Industry (DTI) said Tuesday.
The government likewise approved five measures, including the suspension of special safeguard duty on onion and chicken imports and close monitoring of government rice importation and distribution, to mitigate the impact of soaring inflation.
At the Senate, Senator Cynthia Villar said she is set to sponsor for plenary deliberations the measure on rice tariffication which, in effect, may eventually lead to the abolition of the National Food Authority (NFA).
DTI Undersecretary for Consumer Protection Group Ruth Castelo said they have already met with BNPC manufacturers, representing the 235 items listed in the expanded suggested retail price (SRP), where they requested and appealed to their social responsibility to stop increasing their prices in the next three months or until December 30 this year.
“We requested manufacturers of basic necessities and prime commodities though, to hold off any price increase at least for the next three months. Response in principle is very positive, although we hope to get their commitment in writing. We actually appealed to their social contribution and responsibility,” said Castelo.
She, however, said this is “not a moratorium” because government does not have the power to do that under the Price Act.
Given the choice, Castelo said they would have preferred the manufacturers to agree to hold off SRP price increases until the first quarter of next year.
It was recalled that consumer advocacy group Laban Konsyumer, Inc. (LKI) strongly urged the DTI to implement a moratorium on price increases ọn items listed in the expanded SRP until the end of the first quarter of 2019.
“That is part of our appeal, preferably until next year. Some manufacturers will not increase their BNPC prices until next year,” said Castelo.
So far, Castelo said they got a firmer commitment from manufacturers for coffee, noodles, laundry and bath soap, soy sauce, patis (fish sauce), vinegar, and bread candles against movement in prices in the coming months. But canned sardines and meat manufacturers have not no commitment yet.
DTI said that 40 percent of items under the SRP list have increased prices. Castelo said their computation showed that only 84 out of the 209 SKUs increased their prices and 125 remained stable.
The increases are basically for canned fish and meat products due to current global oil prices, although not all brands increased.
5 measure to stabilize prices
Meanwhile, Presidential spokesman Harry Roque said the decision on the supply-side intervention was reached by the President’s economic managers, other Cabinet members, and tariff authorities after rejecting the proposed reduction of import tariffs on fish and meat products.
“Our economic managers alongside the Department of Agriculture, Department of Agrarian Reform, Department of Labor and Employment, Department of Foreign Affairs, and the Tariff Commission had a recent meeting. They reached a decision that lowering tariffs would not really bring down the prices of commodities especially food,” Roque said during a Palace press briefing.
“So they decided instead to pursue (five) measures to lower prices firstly by approving the importation of round scad. That’s ongoing as we speak,” he said.
Apart from the importation of galunggong, Roque said, the government would also temporarily suspend the special safeguard duty on certain imported onions and chicken to reduce prices. He noted that onion traders have agreed to sell red onions at P55 per kilo in retail stores and white onions at P65 “in two weeks’ time.”
Roque said the Department of Agriculture has also given importers of pork one month to maximize their import quota allocations. At present, he said, 50 percent of the minimum access volume on pork imports have been not utilized by importers.
“Agriculture Secretary Emmanuel Piñol has given them one month to import otherwise the quota will be given to someone else. The intention is to fully avail the minimum access volume quota on the importation of pork products,” he said.
On vegetable products, Roque said the government would conduct “regular inspections” of the warehouses of importers. He said the warehouse inspection seek to determine the actual level of inventory.
As for the NFA’s rice imports, Roque assured the public there would “close monitoring” of the importation and distribution of the commodity. He noted that most imports have not yet reached government warehouses.
“The DA noted that putting the NFA under the DA would facilitate coordination and timing of importation such that this would arrive during lean months when they are most needed,” he said.
But once the Villar bill, which amends the Agricultural Tariffication Act of 1996 to replace the quantitative restrictions (QR) on rice imports with tariff , the DOF shall decide whether or not the NFA “is still relevant to the system.”
The chair of the Senate Committee on Agriculture and Food said the measure introduces a “new model” for the country’s rice market. Under the bill, they are looking at imposing a tariff of 35 percent at most in the rice imports from members in the Association of the South East Asian Nations (ASEAN).