Entry of duty-free cement, wheat likely

The interagency Committee on Tariffs and Related Matters is leaning towards renewing an order that will allow imported cement and wheat to enter duty-free, a trade official said. Trade Senior Undersecretary Thomas G. Aquino told reporters late last week the move should prod cement and flour millers to lower prices, especially as the government is unlikely to impose price controls. "The thinking is that there should be an extension [of an earlier order imposing 0 percent tariffs] for the simple [reason] that government would like to give all opportunities to the argument that lowering duties would make sense," Aquino said. He clarified, however, that the Cabinet had yet to decide on the matter and would likely make its recommendation to the President only on Tuesday. Executive Orders 818 and 818, which eliminated tariffs on imported wheat and cement for six months, lapsed last Jan. 12, causing tariffs to return to 3 percent for shipments from Southeast Asia and 5 percent for those sourced elsewhere. Before the orders lapsed, millers said they would be hiking flour prices by P20 per 25-kilo bag to P770-790 given rising global prices of wheat, an input. Cement prices, meanwhile, have risen to as much as P270 per 40-kilo bag over the P205-210 suggested retail price despite manufacturers not having hiked prices, prompting a Trade department crackdown. The department last week said it would be giving the market a week to comply with prescribed prices before deciding whether to impose price controls. Aquino hinted, however, that such ceilings might not be in order. "Price control on cement takes a heavy toll on us. When you fix the price, you presume to know what the seller wants and what the buyer wants. "That's very difficult," Aquino said. — BusinessWorld