Anti-dumping duties to cut Turkish flour imports by 50% in July, traders say

Turkish flour imports by Philippine traders will drop by 50 percent starting July when the provisional anti-dumping duties imposed by the Department of Agriculture starts to bite, traders said in a media briefing Monday.

 

As a result, bread prices are expected to go up by as much 20 percent, said Ernesto Chua, president of the Malabon Longlife Trading Corporation, an importer and distributor of Turkish flour.

 

Cheap Turkish flour is usually used by small bakeries for pandesal and pastries, and traders said the supply will drop dramatically in July when stocks are expected to have been exhausted.

 

The anti-dumping duties, announced by the Agriculture Department last month, take effect for one month starting next week. At the same time, the Tariff Commission will stage an investigation into the dumping allegations by flour millers in the Philippines.

 

What will happen is that, over and above the regular import duty on flour, the provisional duties of 21.79 percent will be imposed on hard flour making bread, 39.26 percent on biscuit flour, and 35.21 percent in soft flour for pastries and cookies. 

“There are exporters that have already cancelled their orders,” said Chua. 

 

“So, we will sell all the remaining stocks...  So, we will be importing less,” he said.

 

Philippine traders imported 144,000 MT of Turkish flour last year, meeting 7 percent of the domestic demand.

 

This market share is expected to drop to 3 percent while the provisional import duty is in place, and traders are expected to look for other sources of the commodity.

 

The Turkish Flour Yeast and Ingredients Promotion Group (TFYI) is appealing the case before the Tariff Commission.  

 

Malabon Longlife is a member of TFYI, which groups traders that export wheat flour and other Turkish product.

 

“Turkish flour exporters will present our case to prove that there is no need for any definitive anti-dumping measure," Avsin Kasikci head of a business delegation from Turkey, told reporters at the briefing.

 

Turkish flour is not sold at dumping prices in the Philippines, it is sold at competitive prices, the Turkish businessman said.

 

"We are here to grow our partnership with the Filipinos not only through trade relations, but also valuable projects that will create meaningful and long-lasting benefits,” he added.

 

 “As a leading wheat flout producer in the world, Turkey enjoys the economies of scale advantage which allows its exporters to share the cost benefits to their trade partners in over 120 countries,” Kasikci said.

 

If the situation cannot be remedied, Philippine importers may consider Vietnam and Indonesia as alternative sourced of low-priced flour.

 

Exported commodity sold at a price lower than domestic prices is considered dumping.

 

According to the Agriculture Department, Turkish flour sells for around $348 per metric ton (MT) in the Philippine market, compared with the domestic prices of $470 per MT.

 

At the consumer level, bakers pay P700 per 25-kilogram bag of Turkish flour against P900 for the locally-milled product.

 

The average Philippine price of Turkish flour is $400 per MT for soft flour and $450 for hard flour, said Chua, noting the selling price includes freight and other expenses. – VS, GMA News