A group of local flour millers on Monday filed an anti-dumping petition with the Department of Agriculture to stop the influx of cheap flour from Turkey.
Ric Pinca, Philippine Association of Flour Millers (PAFMIL) executive director, said that they want the entry of Turkish flour tightly regulated.
“PAFMIL’s beef against Turkish flour, simply put, is a dumping issue,” Pinca said.
He said the dumping by Turkish flour importers violates the World Trade Organization rules to which most countries – including the Philippines and Turkey – abide by under the world free trade regimen.
Dumping occurs when a country exports a commodity at prices lower than its domestic prices.
“We are up against a group of flour exporters engaging in unfair trade,” Pinca said.
A group of bakery owners and bread producers had warned that prices of Pinoy Pandesal and other flour-based products will rise by 10 to 15 percent if the government restricts the entry of “affordable” flour from Turkey.
Earlier, the Filipino-Chinese Bakery Association, Inc. (FCBA) said flour represents more than half of the total cost of bread production, and an increase in the price of flour will automatically translate into higher prices of bread.
FCBA said that imposing a higher tariff on flour from Turkey would boost the price of Pinoy Pandesal by 50 centavos, from the current P3 per piece.
“There are 25,000 bakeries operating in the Philippines and many small and medium-sized bakeries are using lower priced flour for them to offer breads within the reach of the Filipino consumers,” the FCBA said.
But PAFMIL clarified that its anti -dumping petition is only against Turkish flour, noting that their appeal is a reply to Turkey’s unfair trade activity. At present, there are Indonesian flour, Vietnamese flour, Australian flour and even Indian flour being exported to the Philippines.
“Why is PAFMIL not complaining about these flours? Because the Indonesians, Australians and Vietnamese flour millers are not dumping their flour, meaning their prices are based on verifiable market rates. Meaning they are competing with us fairly and on even terms. That is fair competition,” Pinca said.
“Local flour millers can compete with them because the terms are even. Turkish flour, however, is not a fair competitor,” he added.
Pinca, citing industry data, said that average export price of Turkish flour was $276 per metric ton while their domestic price was $600/MT in 2010; while in 2011, export price was at an average of $388/MT against Turkish domestic price of $600/MT. Last year, it was $340/MT against their domestic price of $470/MT.
“The numbers speak for themselves. Turkey is dumping flour in the Philippines. It is an unfair trade practice. PAFMIL’s anti-dumping petition is our reply to Turkey’s unfair trade activit,” Pinca said.
Turkish flour export to the Philippines grew by 16 percent in 2011 and 71 percent in 2012. In contrast, the local flour industry grew by only 1 to 2 percent during the same periods.
“If this trend continues, there will no longer be a flour milling industry in the Philippines in just a few years and should this happen, the entire country will be left at the mercy of Turkey for our flour supply,” Pinca said.
JAMES KONSTANTIN GALVEZ