A group of local flour millers on Monday said that the bakery industry should not condone the dumping of Turkish flour, even if it benefits any group with lower cost.
In a statement, the Philippine Association of Flour Millers (Pafmil) said that the disagreements over the imposition of antidumping duty on Turkish flour can be resolved, if the bakers would stick to the issue of dumping.
Earlier, the bakery industry said that Turkish flour is cheap and additional tariff would lead to its cost and consequently, higher cost of bread, particularly pan de sal.
But Pafmil has accused Turkish flour importers of dumping flour in the Philippines, a violation of World Trade Organization rules.
Dumping occurs when a country exports a commodity at prices lower than its domestic prices. When a country exports products at dumping prices, it is engaged in unfair trade.
“No one should condone a violation of accepted trade rules even if this benefits any group with lower cost,” Pafmil said.
“Condoning the Turkish practice of dumping is just like saying it is okay to cheat, since we will benefit with lower flour prices. This logic is wrong and unacceptable to the world trading community,” it added.
The flour millers stressed that allowing such practice betrays a warped sense of parity and justice.
“Dumping is a violation of international trade rules and such practice should not be allowed to continue,” they said.
In a letter dated July 18, Pafmil assured Agriculture Secretary Proceso Alcala Jr. that they will maintain the price of flour at present levels during the effectivity of the provisional antidumping duty.
Alcala welcomed the move by Pafmil to provide more supply of flour to maintain its price, as well as stabilize the prices of pan de sal, tasty bread and other bakery products.
Pafmil President Sabin Aboitiz also assured that the millers’ group would maintain higher inventories to supply the market efficiently and without delay.
Earlier, Pafmil millers filed a petition to increase the tariff on imported flour to 20 percent, from the current 7 percent. The group is particularly against the import of cheap flour from Turkey, which has been easing out local flour millers.
Pafmil clarified that the antidumping 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.
Citing industry data, Pafmil said that average export price of Turkish flour was $276 a metric ton (MT) while their domestic price was $600 a metric ton in 2010; while in 2011, export price was at an average of $388 a metric ton against Turkish domestic price of $600 a metric ton. Last year, it was $340 a metric ton against their domestic price of $470 a metric ton.
Turkish flour exports to the Philippines grew by 16 percent in 2011 and 71 percent in 2012. In contrast, the local flour industry grew by only 1 percent to 2 percent during the same periods.
James Konstantin Galvez