Retail pork prices still well above government price caps

THE retail price of pork in the wet markets of Metro Manila has remained above P320 per kilogram and peaked at P380 per kilogram, well above the mandatory price cap of P280 to P300 per kg of government.

The higher prices come less than three weeks before the government’s price cap was lifted for pork and chicken products in Metro Manila.

Price monitoring by the Department of Agriculture (DA) showed that from March 15 to 19, the going price for pork ham (kasim) in some markets in Metro Manila ranged from 300 to 350 pesos per kilogram.

DA reports showed that on March 19, a kilogram of pork kasim reached P320 on average.

The prevailing price for pork belly (liempo) during the same reference period ranged from P320 to P380 per kilogram. On March 19, the going price for the cut of pork was 340 pesos per kilogram.

As of February 8, pork kasim and liempo sold in Metro Manila are capped at P 270 per kg and P 300 per kg, respectively. The ceiling price is in effect for two months or until April 8.

“The market dictates the price”

Federation of Pork Producers of the Philippines Inc. (ProPork) President Edwin G. Chen said these going prices are the actual market price for pork given the country’s current limited supply situation.

“It’s the market price. The market dictates the price, ”Chen told BusinessMirror.

Philippine Chamber of Agriculture and Food Inc. (PCAFI) Chairman Danilo V. Fausto said pork industry players have repeatedly stated that the price of pork is expected to be between 330 and 360 pesos per kg, taking into account the current costs incurred by pig farmers.

Fausto noted that the government is simply tolerating the higher prices of pork cuts in wet markets in Metro Manila because it is aware of the challenges producers and retailers face in complying with the caps.

Some pork industry players have proposed to increase the ceiling price to P330 to P360 per kg or to remove the ceiling price and instead implement a suggested retail price with the same quantities offered.

Fausto said the wholesale cost of a kilogram of pork currently ranges from P290 to P310 given the current on-farm level of P180 to P200, the slaughter cost of P60 per kg and the cost of transporting P50. .

Fausto takes issue with the view that the price cap target was overcome since the prevailing market prices breached the prescribed price cap.

He pointed out that the price cap had a “psychological” impact on market participants – that they were being watched by the government following the surge to P400 per kilo in recent months.

With the price cap, the industry will no longer push for a high price of P400 per kilogram, Fausto added.

DA data showed that the lowest market price for pork began to exceed the price cap on March 8, a month after the measure was implemented.

DA data showed that the lowest price for pork ham in Metro Manila on March 8 was P295 per kilogram, while the lowest price for liempo pork was P310 per kilogram.

Agriculture Secretary William D. Dar has been lukewarm to the proposal, arguing that an increase in the price cap would be “a redundant measure given that real average pork and chicken prices are above the cap. imposed by OE 124 “.

Dar said if the price cap was raised, industry players would increase their prices again, with Filipino consumers losing out.

“It is no exaggeration that if the price cap is raised to a new level, industry players will raise their prices again, emboldened by the fact that they are able to put pressure on the government to do so. he changes his mind, “he said.

“In the meantime, consumers will worry that the government is not really serious about protecting their interests,” he added.

Dar noted that Filipino consumers “are suffering from lower incomes due to the negative impact of the Covid-19 pandemic on our economy.”

“Pork producers, wholesalers and retailers should not do less to help the country’s economic recovery effort,” he added.

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