By Justine Irish D. Tabile, Journalist
THE Department of Agriculture (DA) announced on Monday that it is considering enforcing a maximum suggested retail price (MSRP) for imported garlic as market rates persistently remain elevated.
“Naturally, we prefer to resolve this through discussions, so we avoid imposing an MSRP (on garlic). However, if they refuse to comply, we may indeed implement an MSRP (on garlic),” Agriculture Secretary Francisco P. Tiu Laurel, Jr. informed reporters following an examination of a public market in Quezon City.
Results from market surveillance on Monday revealed that prices of agricultural goods, including rice, pork, and fish, are declining, but garlic prices continue to be high.
“The only aspect that disappoints us is the price of garlic. It is relatively costly, being sold at P140-P150 per kilogram,” Mr. Laurel remarked.
“The DA is working on finding a solution to address this issue and reduce its cost since it is imported. Ninety-five percent of the garlic available in our markets is brought in from abroad, so we will need to oversee that,” he further stated.
As per the Agriculture secretary, importers are retailing garlic at P110 per kilogram, even though the landed expense amounts to P80 per kilogram.
“The vendor mentioned they purchased (garlic) for P110 per kilogram. Therefore, if they retail it at P140, they will gain a profit of P30. We will evaluate whether that P30 per kilogram is excessive, but I believe it is reasonable,” he stated.
“Yet, garlic importers claim their expense is merely P80 a kilogram, while they sell it for P110 per kilogram. This assumes they are accurately declaring their values, but I am aware that they sometimes undervalue, possibly resulting in a margin of P40-P50 per kilogram. I perceive that to be excessive,” he added.
Mr. Laurel indicated that the DA is finalizing figures before convening a meeting with importers. Nevertheless, he expressed that garlic should ideally be sold at P100-P110 per kilogram.
In response, Samahang Industriya ng Agrikultura (SINAG) Executive Director Jayson H. Cainglet stated that merely 5% of garlic is domestically produced, which is why the group embraces the suggestion to enforce MSRP on imported garlic.
“The landed cost of garlic ranges from P70 to P80 per kilogram, hence the retail price should not surpass P130-140 per kilogram,” he mentioned in a Viber message.
“If its rate exceeds P150 per kilogram, it unmistakably indicates profiteering throughout the value chain of imported garlic,” he added.
However, Mr. Cainglet noted the government has very limited options for immediate actions, as the majority of garlic is imported.
“A long-term strategy could involve revitalizing the local garlic sector so that we can have better oversight over the complete supply chain,” he remarked.
Federation of Free Farmers National Director Raul Q. Montemayor mentioned that there is widespread profiteering in garlic imports, similar to trends seen in rice, pork, and other goods.
“Garlic is entering the country at a declared landed price of only P25 per kilogram. Its actual landed cost is approximately P60 per kilogram, and importers report a lesser price to evade higher tariffs,” he conveyed in a Viber message.
“Nonetheless, the current retail price of garlic is about P140 per kilogram, occasionally even hitting P200 per kilogram, signifying vast profit margins. While the MSRP may offer assistance, we must also explore additional measures to address profiteering,” he added.
Mr. Montemayor asserted that the government could utilize the Price Act or the Anti-Economic Sabotage Law to tackle profiteers.
“The long-term objective is to assist our local farmers in enhancing their productivity and output so they can provide more garlic at competitive prices,” he added.
Conversely, Philippine Chamber of Agriculture and Food, Inc. (PCAFI) President Danilo V. Fausto remarked that there is no “unjustifiable fluctuation of garlic prices which necessitates government intervention.”
“Garlic and onions have similar characteristics concerning production and price variations. An essential aspect is that we need to motivate more farmers to cultivate garlic to expand supply,” he stated in a Viber message.
For his part, Mr. Laurel noted that garlic requires temperate weather, making it challenging to grow in the country.
“Additionally, our planting materials, our traditional garlic variety, are small but possess a distinctive flavor. No one can outproduce China in garlic cultivation worldwide, so countries like Thailand, Vietnam, Cambodia, Indonesia, and Taiwan rely on imports from them,” he explained.
Mr. Laurel detailed that the DA is also considering adopting Korean technology that could amplify production to 12-15 tons of garlic per hectare. In the Philippines, farmers currently yield only about one to two tons of garlic per hectare.
Besides garlic, Mr. Laurel mentioned that the DA is monitoring chicken and egg prices to determine if there is a need to enforce a price ceiling.
The DA is also contemplating maintaining the P45 MSRP on rice to guarantee that farmers can achieve profitability.
“In fact, our original intention was to further reduce it to P42, but given the current trends during our harvest season, it is declining,” he noted. “Thus, I believe it is wise to keep the MSRP at P45 for the upcoming two months until the harvest season concludes.”
