Analysis of the meat importation of the Philippines, 1991-2009

Date

4-2011

Degree

Bachelor of Science in Agricultural Economics

College

College of Economics and Management (CEM)

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Abstract

This study analyzed the meat importation of the Philippines from 1991 to 2009. It determined the trend in importation of selected Philippine meat products. The source countries of carabeef, beef, and chicken as well as the trends in domestic production, per capita consumption, utilization for processing, domestic prices, import volume, import value, and import price were determined. It also described the Philippine tariff rates and the implementation of relevant SPS measures. The import procedures were also presented. Furthermore, this study analyzed the effects of related factors (i.e., domestic production, per capita consumption, utilization for processing, domestic prices, import price, foreign exchange rate, import tariff, and SPS measures) on the import volume and value of the selected Philippine meat products. In addition, it determined the import competitiveness of selected Philippine meat products. Lastly, it identified problems in the process of meat importation and provided recommendations that would improve the Philippine livestock and poultry subsector. The study was done at the national and international levels and utilized primary and secondary data. These were presented with the aid of tables and graphs and were analyzed using descriptive analysis, trend analysis, multiple regression analysis, and import competitiveness analysis. The import volume and value of carabeef, beef, and chicken improved from 1991 to 2009. The average import volume and value of carabeef and beef amounted to 597 metric tons and USD 993,442. For imported chicken, the average volume was 1,318 metric tons valued at USD 1,155,591. The United States is considered the major source of bovine meat and chicken with an average volume of 143 metric tons and 794,855 metric tons and a share of 23 percent and 68 percent, respectively. During the same period, the domestic production had a positive growth rate posted at 3.28 percent for carabeef with an average volume of 74,044 metric tons, 3.04 percent for beef with 166,062 metric tons, and 6.25 percent for chicken with 549,294 metric tons. The per capita consumption and utilization for processing also followed an upward trend. The highest per capita consumption was registered for chicken at 7.20 kg/yr while the highest utilization for processing was noted for beef at 16,606 metric tons. The domestic prices increased by 4 percent to 6 percent with an average price of PhP 41/kg for carabeef, PhP 51.71/kg for beef, and PhP 61.98/kg for chicken at the farm level; PhP 65.07/kg for beef and PhP 56.57/kg for chicken at the wholesale level; and PhP 107.43/kg for beef and PhP 87.53/kg for chicken at the retail level. The import price of bovine meat with an average price of USD 2.71/kg declined by 0.24 percent while for chicken, it averaged at USD 1.98/kg with a 2.50 percent growth rate. From 1991 to 2009, there were three major adjustments in the Philippine tariff rates for carabeef, beef, and chicken. These were covered in the Executive Order 470 in 1991, the Executive Order 288 on tariff quota in 1995, and the implementation of a uniform tariff in 2003. The tariff rates for bovine meat and chicken ranged from 60 percent to 10 percent and from 100 percent to 40 percent, respectively. The Tariff Commission develops and implements the rules and regulations for tariff rates in the country. In the case of SPS measures for selected imported meat products, the country adopts both Codex and local standards which include the Code of Good Animal Husbandry Practices, the Code of Maximum Residue Limits for Veterinary Drugs in Food, and the Philippine National Standards for Beef Primal Cuts. In addition, imported meat should also pass through the pre-border, border and post-border inspections. The Bureau of Animal Industry, the National Meat Inspection Service, the Bureau of Agriculture and Fisheries Product Standards, the Department of Trade and Industry – Bureau of Product Standards, and the Bureau of Customs are the agencies responsible for the formulation and implementation of SPS measures. Using multiple regression analysis, the effects of domestic production, per capita consumption, utilization for processing, domestic prices, import price, foreign exchange rate, import tariff, and SPS measures on the volume and value of imports were tested. Results of the analysis showed that domestic production, utilization for processing, import price, and foreign exchange rate significantly affect the import volume of carabeef. For beef, import price serves as a significant determinant of changes in the import volume while the variations in the import value of chicken are explained by domestic production, per capita consumption, and retail price. Results of the import competitiveness analysis using simple price comparison revealed that the selected Philippine meat products are not competitive against imported meat from all source countries. The less than one price ratios suggested that locally-produced beef and chicken could not compete with imported meat in the domestic market. In 2009, the cheapest source of beef and chicken is Canada with a price ratio of 0.19 and 0.37, respectively. Importer respondents cited problems in the process of meat importation such as the difficulty in the accreditation of source countries; the delay due to laboratory analysis and sample experiments; the entry of smuggled meat products; the lengthy documentation process; and the confusing guidelines in the issuance of import permit. The recommended courses of action to address these problems include providing support to domestic producers of water buffalo, cattle, and chicken; intensifying the enforcement of SPS measures; strengthening the linkage between the accredited source countries and importers; streamlining the accreditation process; implementing the capacity building program for the DA regulatory agencies; and improving the bilateral relationship with selected source countries.

Language

English

Location

UPLB College of Economics and Management (CEM)

Document Type

Thesis

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