Farm dep’t to lift suggested price cap for pork

The Department of Agriculture (DA) on Wednesday said it would lift the maximum suggested retail price (MSRP) for pork, demand for which spiked during the election season, within 24 hours amid low compliance among suppliers.

“It’s called one step back and two steps forward,” Agriculture Undersecretary for Livestock Constante J. Palabrica told reporters on the sidelines of an industry event on Wednesday. The agency is studying a better way to deal with high pork prices, he added.

“We are going to lift it, we’re going to study it then come up with a revised program,” he said.

The MSRP was set at PHP 300 per kilo for whole pig, PHP 350 per kilo for pork shoulder and hind leg and PHP 380 per kilo for pork belly. 

But the agency had been complaining about low compliance with the MSRP since the first week of implementation, now at below 30%.

Mr. Palabrica attributed high pork retail prices to high farmgate prices that have hit as much as PHP 290 per kilo.

He said increased demand during the election season outpaced low domestic supply caused by the African Swine Fever (ASF). “It’s the law of supply and demand.”

“So, expect a possible revision of MSRP, holding it for the meantime while we are studying how to make it really effective,” he added.

For now, the agency will focus on buying hogs from pig farms at a lower price — set at PHP 230 per kilo — and distributing these to key slaughterhouses.

He was referring to a direct-sourcing strategy piloted by the Food Terminal, Inc. (FTI) with Thai firm Charoen Pokphand Foods PLC (CP Foods). The FTI is supplying a Caloocan slaughterhouse with 100 live hogs daily from CP Foods under a pilot program that started in April.

“The first thing we asked for was 100 pigs a day,” Mr. Palabrica said. “And then by next month, it will be 200. And then our target is around 500 pigs [a month].”

He added that the government is also looking into a similar strategy used by other farm companies including Pilmico Foods Corp.

“We are looking for other farms which can supply us with our own price,” he said. “If we can get a price of PHP 230, then we can supply at a lower price in the market.”

The Agriculture official said about PHP 5-7 billion is earmarked for the direct-sourcing program, which doesn’t cost the FTI because it sells the hogs at the same price, while the delivery cost to slaughterhouses is shouldered by the partner company.

“If we get it at PHP 230, you will also buy at PHP 230. Then for logistics, we have gotten a discounted price,” he added.

Mr. Palabrica said Philippine pork supply is stable. “We have enough supply of pork. But the limited number is for local pork. On imported pork, we have a lot of supply.”

Pork imports hit 53.598 million kilos in February, up from 38.994 million kilos a year earlier.

Forty-two Philippine villages had ASF cases as of March 28, up from 39 barangays as of March 14, according to data from the Bureau of Animal Industry. More than 6,200 villages have been affected by ASF cases since the first outbreak in 2019.

Mr. Palabrica said they expect the commercial rollout of a Vietnamese ASF vaccine by the end of the year.

The Agriculture department earlier said it is working with the hog industry to increase their herds by at least two million hogs each year through 2028 to return to pre-ASF levels.

Regionalization pact

Meanwhile, Mr. Palabrica said the Philippines is in talks with several countries as it implements a regionalization agreement for the imports of live chickens and their products.

Thailand, Taiwan, Paraguay and Chile are seeking to be included in the deal that seeks to do away with a countrywide ban on a trade partner dealing with bird flu outbreaks, he said.

Under the pact, the Philippines will impose a ban on poultry imports only from a specific area affected by avian influenza, allowing imports from zones or regions certified free from the animal disease.

The US, Poland, Spain, Portugal, Brazil and the Netherlands are among the countries that have been accredited by the Philippine government, Mr. Palabrica said.

The DA earlier said a countrywide ban limits the sources of day-old chicks, parent stocks and poultry meat, which leads to higher prices.

The three-phase process for inclusion in the agreement includes submission of documents on veterinary oversight, disease surveillance, traceability, control measures and zoning protocols by the exporting country.

The application will be reviewed by a risk assessment team.

A regionalization agreement will then be drafted and finalized after a successful evaluation, outlining the import terms and conditions, including revised veterinary certificates.

The agreement also mandates continuous disease reporting and biennial reviews and provides grounds for termination in cases of undeclared outbreaks.

Philippine chicken imports hit 31.7 million kilos in February from 32.426 million kilos a year earlier. – Kyle Aristophere T. Atienza, Reporter