FILIPINO consumers will only feel a ‘minimal’ increase in prices of pork jowl products like ‘sisig’ and processed meat goods if the bid for reclassification and tariff hike on the commodity pushes through, according to the Department of Agriculture (DA).
Agriculture Secretary Francisco Tiu Laurel Jr. made the pronouncement after the DA’s petition to levy higher duties on imported pork jowl stoked concerns among processed meat manufacturers, saying consumers would feel the pinch of price hikes.
‘The profit margins are healthy and more than usual due to cheaper source [of raw materials],’ Tiu Laurel recently told reporters.
‘The [hike in tariffs on frozen pork jowl] should not increase [prices of processed meat products]. If it does increase, it should only be minimal,’ he added.
The DA lodged its petition with the Tariff Commission (TC), seeking to modify the tariffs levied on frozen pork jowl by reclassifying it as swine meat.
If this materializes, duties slapped on pork jowl will be increased to 25 percent from the current 10 percent.
Furthermore, the DA chief said the agency stands ready to implement stringent measures like imposing a price cap on frozen pork jowl if manufacturers ‘abuse’ the cost passed onto consumers.
‘If they happen to abuse it a bit, then we’ll have to issue a price cap on [imported pork jowl in the future],’ he said.
While Tiu Laurel did not disclose the possible cost of the price ceiling, he said current pork jowl prices should be maintained.
The prevailing price of imported pork offals, of which pork jowl is included, retails at P140 per kilo as of September 27.
This is lower than the price of local pork offal at P248.63 per kilo, based on the latest government price monitoring report.
Earlier, a local manufacturer that uses frozen pork jowl as a raw material warned that the government’s proposed move will trickle down to the cost of processed meat products, such as sausages and longganisa.
Mishie Tongson from PrimeAgri said reclassifying and imposing higher duties on frozen pork jowl would be ‘unfair’ for producers of processed meat goods, already subject to value-added tax (VAT).
‘If we impose a high tariff or reclassify it to be similar to the classification of [swine] meat, everything will have a domino effect on the supply chain,’ Tongson said.
She added that on top of imposed taxes, the increase in minimum wage and transportation costs would be added to manufactured goods, ‘which will ultimately be passed onto the consumer.’
‘The business owner is just processing it; everything that increases [along the supply chain] is passed on to the consumer. So if that happens, almost all of our pork products will become more expensive,’ Tongson added.