Seaweed exporters seek removal of China's 35% tax on carrageenan

A group of seaweed exporters has asked the Agriculture Department to lobby for China's removal its 35-percent duty and value-added tax (VAT) on carrageenan — a gelatinous extracts from seaweeds. "China imports raw seaweed from US tax-free. We should be accorded the same privilege," said Benson Dakay, president of Seaweed Association, on Monday. Dakay said the imposition of the 35-percent duty and VAT is a form of an "unfair trade practice." The seaweed exporters want the DA to seek the help of the Association of South East Asian Nations (ASEAN) regarding the matter. The Association disclosed that Indonesia and Malaysia are mulling the possibility of seeking the ASEAN's help regarding the matter. China engages Asean countries through the so-called Asean Plus Three cooperation. Local seaweed exporters are keen on China because of its huge demand for carrageenan, he said. Also, Dakay said another challenge confronting seaweed exporters is the continuous appreciation of the "greenback against the peso." "Seaweed exporters cannot survive [at the current exchange rate] of P45 against the dollar," he said. Industry data showed seaweed farmers expect to produce 80,000 metric tons (MT) of raw seaweed, which is 23 percent higher than the 65,000 MT produced last year. The increase is substantially due to good seaweed prices in the international market. Currently, seaweed is priced at $1,700 per metric ton. The Seaweed Association said industry requirement for raw seaweed this year is placed at 140,000 MT. This means that seaweed exporters would have to import 60,000 MT of seaweed mostly from Indonesia. Filipino fishermen have been culturing the eucheuma seaweed since 1972. Seaweed is the raw material used in processing carrageenan — a thickening agent used in various food and cosmetic applications. —JE/OMG, GMANews.TV