The Department of Finance believes the Philippines should continue to import pork as the local hog industry has yet to recover from the African swine (ASF) outbreak.
Finance Undersecretary and Chief Economist Gil S. Beltran said on Thursday, Jan. 13, that the country “definitely” needs to import pork to meet the demand and immediately compensate for the shortfall in domestic supply.
Beltran said the effects of the ASF still linger, adding that “it will take some time to recover decimated hog populations.”
“For perspective, the seasonal peak in pre-ASF hog headcount was 13.1 million in the third quarter of 2018; hog inventory fell to less than 9.9 million as of the end of the third quarter in 2021,” Beltran said.
The Department of Agriculture had confirmed the outbreak of ASF in the country in the middle of 2019 but it was in 2021 that the country felt more fully the debilitating effects of the hog infection.
Hog production slumped by as much as 23.4 percent in the first nine months of 2021 as compared to the 4.2 percent decline in the same period the prior year
For this reason, meat price inflation topped 16.8 percent in 2021, the highest annual price increase of any major food item since 2012.
For perspective, the highest price inflation of rice, another trade regulated commodity, was 11 percent, back in 2011.
The 16.8 percent meat price inflation accounted for 1.1 percentage points to the 4.4 percent overall inflation.
Had meat price inflation been half as high, Beltran said the upper level of the 2.0 percent to 4.0 percent inflation target range would not have been breached.
Across the Pacific, meat also continues to fuel an elevated inflation. US pork consumer price index increased by an average eight percent for the first 11-months of 2021.
“It did not help that global meat prices similarly increased,” Beltran admitted.
To stem the continuing pork price spiral, Beltran suggested some interventions such as extending the validity of Executive Order 133 until December 2022 as proposed by National Economic and Development Authority (NEDA).
He also said the government may need to reverse the low utilization of minimum access volume (MAV) Plus, which was only at 46.4 percent as of end-2021, according to NEDA.
The government should also ensure the regular release of pork stocks in cold storages and the continuous replenishment of unloaded stocks from either local supply or imports, he said.