The Philippine Department of Agriculture (DA) said raising the minimum access volume (MAV) for yellow corn imports to 500,000 metric tons (MT) is intended to ensure that animal feed manufacturers retain access to raw materials.

"Ensuring a sufficient supply of low-priced corn is essential to supporting animal feed production, keeping production costs of meat affordable and protecting the country's food security," Agriculture Secretary Francisco P. Tiu Laurel, Jr. said in a statement.

The MAV expansion, carried out through an executive order (EO), is designed to address a projected domestic corn shortage of about 1.42 million MT between March and December, according to the DA. The additional imports will serve as supplementary supply during the pre-harvest season, the stretch before fresh domestic harvests reach the market.

Easing pressure on feed prices could limit the rise in production costs for hog raisers and, to a more limited extent, poultry producers, the DA added.

"We need to make sure our livestock and poultry industries have access to the feed ingredients they need without placing additional pressure on consumers," Mr. Laurel said.

President Ferdinand R. Marcos, Jr. approved Executive Order No. 129, which added 280,000 MT to the previous corn import MAV of 220,000 MT, widening the window in which imports can enter at lower tariff rates.

The MAV is a tariff-rate quota mechanism that permits a designated volume of imports to enter at lower tariff rates, with volumes beyond the quota subject to higher duties. Yellow corn is the principal feed grain for the Philippines' livestock and poultry sectors, and domestic output is routinely supplemented by imports to meet demand.

Foundation for Economic Freedom (FEF) President Calixto V. Chikiamco said the expanded MAV remains inadequate.

"MAV should at least be 1.5 million MT, but, ideally three million MT," Mr. Chikiamco said via text message when asked to comment on the EO. His proposed 1.5-million-MT floor would exceed the 1.42 million MT shortfall the DA projects for March through December.

He added that tariffs on corn imports should be lowered to 5%, citing declining domestic production due to El Niño, a recurring climate pattern that typically brings below-normal rainfall to the Philippines.

"Corn accounts for 60% of the cost of chicken and pork. Lowering the tariff on corn and increasing the MAV will lower the cost of chicken and pork," he added. Taken together, his remarks place the quota expansion within a broader feed-cost policy debate over quota size and tariff rates, with the DA projecting the supply gap to run through December.

Reporting by Maria Mikaela H. Tormon for BusinessWorld. Source: BusinessWorld Online