The Department of Agriculture (DA) has thumbed down a proposal by local importers and traders to retain the government’s policy on the minimum access volume (MAV) for imported pork, as the agency stressed the need for a “total reset” to restore competitiveness in the market.

Agriculture Secretary Francisco Tiu Laurel outright rejected the proposal submitted to the MAV Management Committee by the Meat Importers and Traders Association (MITA), calling the move “self-serving.”

“You cannot have a few companies control the advantage of lower tariffs. Then they control the prices, then they can manipulate the markets,” he told reporters last Monday, Dec. 15.

MITA earlier urged the government to retain the current MAV guidelines, warning that changing the system could affect the landed costs of imported meat, potentially leading to an increase in retail prices.

The industry group even warned that such a disruption could “negatively affect supply” of imported pork in the coming year.

Under the MAV policy, imports enjoy a lower tariff rate within a specific quota allocation, unlike shipments outside the quota, which are slapped with a higher tariff.

For pork, imports within the MAV face only a 15-percent tariff, while those outside the quota are charged 25 percent.

The MAV for imported pork currently stands at 54,210 metric tons (MT).

Tiu Laurel said the current system allows longtime traders to steadily build up allocations over time, giving them control over a large share of imports and the market influence that comes with it.

Earlier this year, the DA found that 47 of the 130 quota holders account for 80 percent of the total MAV allocation. Of these, 22 were found to have cornered 70 percent of the volume.

To bring competitiveness back into the imported meat market, Tiu Laurel said the government is keen on a “total reset of the system.”

He said allocations for major traders will be reduced to zero, while small traders will be given an equal opportunity to secure a share of the MAV pie.

Traders are expected to contend for 30 percent of the total MAV volume, or around 16,200 MT.

Under the new policy, 20 percent will be allocated to the Kadiwa program through state-run Food Terminal Inc. (FTI), giving the government an option to intervene in the market when retail prices soar.

To prevent spikes in the cost of processed meat, half of the MAV will be allocated to meat processors.

MITA also said the proposed allocation split is counterintuitive at this time, arguing that the current MAV of 54,210 MT is already insufficient for the industry.

Instead of a new policy, the group said the government should prioritize the MAV-plus scheme, which increases the volume of imports benefiting from the lower tariff scheme.

MITA noted that the additional volume may be prioritized for processors, with a portion designated for first-come, first-served imports.

Tiu Laurel earlier said he had asked Malacañang to expand the quota by as much as 150,000 MT. However, he said this is not a priority at the moment, as farmgate prices for pork are not yet conducive to the arrival of cheaper pork imports.