Malacanang is back to its bad policy of issuing administrative orders that batter the agricultural sector under the pretext of promoting food security, with the signing of Administrative Order No. 20 on April 18, 2024 dismantling non-tariff barriers on the importation of sugar, pork, fish and other commodities, paving the way for unbridled importations. Indeed, the country imported 25,000 metric tons (MT) of fish on the same day AO 20 was signed.
AO 20 has been touted as the solution to the indefensible chronic shortages of rice, sugar, fish, onion and other food items in a largely agricultural country where 507,000 hectares of farms covered by the Comprehensive Agrarian Reform Program (CARP) still has to be distributed to landless farmers and landlords like the Sy, Villar and Ayala families have been busy scooping up arable land for their residential, commercial and memorial parks while Maharlika Investment Corp. (MIC) chief Joel Consing brags about the 1.2-million hectares of government land to be transformed into agricultural estates.
This AO speeds up the releases of Sanitary and Phytosanitary Import Clearances (SPSICs) for agricultural imports, which would immediately boost the recycling of import permits, the underdeclaration and undervaluation of cargoes and lead to hoarding. Worse, meat processors will have the incentive to import mechanically deboned meat (MDM), a favorite of fastfood chains, to stock up on their raw materials for canning. As in the past, choice meat cuts will be labeled MDM and end up in the shelves of wholesalers and retailers with cold storage facilities. It is not strange that the usual solution of the current administration is to import since it cannot cut the mustard in crafting a doable, viable and sustainable food security policy despite the fact that the family of Agriculture Secretary Francis “Franco” Tiu Laurel Jr. had been in the tuna business for more than 50 years and had expanded to aquaculture, meat processing and a slew of other businesses. Expertise in the private sector is not a guarantee of brilliance in the public sector.
Yet, the government was well prepared to justify the issuance of AO 20 despite fierce opposition from the Kilusang Magbubukid ng Pilipinas (KMP) and the Pamalakaya, a federation of fisherfolk opposed to the reclamation of a large section of the Manila Bay and the attempt of commercial fishing corporations to compete with fishermen in municipal waters. The number crunchers at the National Economic Development Authority (NEDA) led by Socioeconomic Planning Secretary Arsenio M. Balisacan issued a 14-page statement to justify AO 20, saying the order seeks to ensure the country’s food security by removing non-tariff barriers as the Inter-Agency Committee on Inflation and Market Outlook (IAC-IMO) expects the production of rice, pork, onion and sugar to fall short this year. The AO 20 follows Executive Order (EO) No. 50 which reduced tariffs on rice, corn, and meat products until the end of the year.
In one horrid admission, Balisacan said local rice production will fall 15% below demand even as output is expected to rise by 0.7% this year. This is a historic high since rice deficit traditionally ranges from 7% to 10% of demand and Philcongrains president Herculano “Joji” Co insists reducing postharvest losses and modernizing milling facilities could even erase the deficit. Balisacan should have been grilled on this by reporters on the beat since they are out to understand what has not been said but they didn’t. No question was raised why local production of pork was adequate from 2017 to 2019 when the average output was 1.61 million metric tons (MMT) and demand was 1.52 MMT, with the surplus at an average of 87,920 MT. The culprit was Asian swine flu (ASF) and the country suffered a deficit in pork production, with 61,430 MT shortfall in 2020 that skyrocketed to 389,770 MT in 2021 and 2022, which meant an increase of more than 500% in just two years! Balisacan said local hog production is expected to increase by 2.8% this year, but it will still be 20% below pre-ASF levels. Apparently, the temporary measure will be in place until 2028.
AO No. 20 will benefit the traditional importers of onion and sugar, the prices of which have soared in the dying days of the unlamented Duterte administration and into the Marcos Jr. regime. In January 2023, the average retail price of red onions soared to P465 per kilogram, 113% higher than the P219 per kilo average in January 2022. In January 2023, the price of white onions zoomed 215% to P367.70 from only P116.70 in January 2022. This year, in spite of a projected 4.7% increase in onion production, the supply will still lag demand by 10%. Curiously, Balisacan blamed the non-issuance of SPSIC for soaring onion prices. Sugarcane yield shrank 10.7% in 2022 as hectarage devoted to the crop decreased by 4.5%. The Central Azucarera de Don Pedro, Inc. (CADPI) in Batangas just shut down because government did not allow it to import raw sugar for refining. Curiously, AO 20 has delighted favored sugar importers like Michael Escaler and Martin Araneta.
“AO 20 is counterproductive because the over-reliance on cheap imports disincentivizes domestic producers and undermines domestic agricultural production, especially in the absence of substantial support for local agriculture,” KMP protested. Pamalakaya said the DA changed tack immediately after AO 20 was issued by Malacanang, retreating from its recent move to cancel import clearances for fish products as they were illegally diverted to wet markets. “Allowing for more imports of sugar, fish, and other agricultural products will not taper prices nor bring food to the tables of ordinary Filipinos. The government is making another economic misstep with its policy of unhampered importation,” the fisherfolk alliance argued.
Years of massive food importations have proven to be the nemesis of the farming and fishing sectors, contrary to the pious belief of NEDA that allowing foreign foodstuff to swamp the domestic market will bring prices down. A recent SWS survey shows that at least 33% of Filipino families rate themselves “food-poor.” Self-rated food poverty rose in Visayas and Metro Manila. As of March 2024, the percentage of Self-Rated Food-Poor families was highest in the Visayas at 46%, followed by Mindanao at 44%, Metro Manila at 28% and Luzon at 24%, KMP disclosed. KMP said the job of NEDA is to craft policies that raise food output, improve the quality of crops and sustain fish catch. It was not organized to secure food imports and neglect farming and fisheries. (DEO MAGNO)