October 30, 2018
Last week the U.S. Trade Representative’s joint statement with the Philippine Secretary of Trade and Industry shed light on several key U.S. red meat trade issues that may be getting resolved. This includes not only collaboration on the development of cold chain requirements and best practices in the Philippines, but also an agreement to seek improvement in the valuation of agricultural imports for duty collection purposes.
According to Joel Haggard, U.S. Meat Export Federation senior vice president for the Asia Pacific, the Philippines is a rapidly growing destination for U.S. red meat, especially raw material used in further processing.
“In 2017, the Philippines bought approximately $150 million in U.S. red meat, and we are looking at maybe seeing $200 million in red meat purchases this year,” Haggard says. “The country has a very advanced meat processing sector which is able to supply affordable protein to most of the population and much of the raw material used in this processing of items is imported raw material.”
Through August, U.S. pork exports to the Philippines totaled 30,759 metric tons, up 22% from a year ago, valued at $73.9 million (up 17%). Beef exports were 25% ahead of last year’s pace in volume (11,408 mt) and 30% higher in value ($55.9 million).
Haggard says while the market has been good, it’s not without its issues for U.S. exporters.
“The U.S., as well as other foreign suppliers, have confronted a number of trade access problems over a number of years,” Haggard says. “Import policies have been subject to political winds as the country has a large agricultural sector, in particular, a very politically strong pork industry.”
USMEF was encouraged by the USTR news that the U.S. and Philippines governments had been working through some of these lingering issues that have at times affected meat trade. Haggard says specifically, several years back, when the Philippines attempted to place restrictions on the distribution and sale of frozen imported meat, calling imported defrosted meat “unhygienic.”
“Our reading of the joint statement last week saw that both countries pledge to invest in capacity building to improve the Philippines cold chain which should be good for both domestic and imported products,” Haggard says.
Finally, Haggard says the USMEF was also encouraged by the Philippines pledge to adhere to World Trade Organization practices for customs evaluations.
“In the past imported products, and not just from the U.S., have faced issues with customs not assessing import duties on the basis of transaction values, but rather arbitrarily, assigning a value to imports which was often higher than the transaction price, meaning of course higher import duties,” Haggard says.
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