Thai food and feed producers reveal “Impacts of Pulse Tariffs on Thai Business” study findings

Thai food and feed producers reveal “Impacts of Pulse Tariffs on Thai Business” study findings Lower import tariffs will not affect Thai farmers, but will expand the domestic processed food and feed market and generate more exports. AgriSource Co., Ltd., in conjunction with a group of Thai food and feed producers revealed today results of their survey on the “Impacts of Pulse Tariffs on Thai Business”. The findings indicate that lower tariffs on pulses (dry peas, chickpeas, lentils) will not have an impact on Thai farmers and domestic Thai food producers, as these crops cannot be produced domestically. The group hopes to see import tariffs lowered to 5% or zero, which they expect will increase the competitiveness of locally processed foods based on these crops, compared to imported products. The tariff reduction will also help the domestic market grow, generate more export business, and increase gross tax revenue to the Thai government. Thai producers of processed foods and feeds based on pulses are adversely affected by existing tariffs of 30% of the Cost Insurance & Freight (CIF) value. After taxes and other charges, Thai importers must pay duties totaling 40-45% of CIF value. Thailand’s tariffs on pulses are more than 6 times the levels of other major ASEAN importers. Thai producers of processed items, such as canned and snack foods, have suffered directly under these high rates. Meanwhile, other leading ASEAN countries have already opened their markets to dry peas and other pulses. Malaysia and Singapore reduced tariffs to zero, while the Philippines and Indonesia have reduced theirs to 3% and 5% respectively. The 30% import tariffs on pulses make domestic prices of Thailand’s processed food higher than products imported at the 0-5% tariff rate from other ASEAN countries. When these foreign competitors export finished snacks and other foods to Thailand, the assessed import tariff in Thailand is currently set at the AFTA rate of 5%, further making Thai food processors less competitive than their ASEAN competitors. Food and agribusiness consultancy AgriSource Co., Ltd., has monitored movements in pulse import tariffs and trade. Their study was conducted by gathering and analyzing data from relevant government agencies and leading private food and feed producing companies. The findings indicate that importing dry peas, lentils, and chickpeas will not have an impact on Thai farmers and, consequently, it is not necessary to limit import volumes to protect farmers with the existing 30% import tariff. Growing these crops is most economical only in cool climates with long photo-periods, not in tropical countries like Thailand. “The findings also indicate that lowering the import tariffs on pulses to 0% will generate an additional Bt46.42 million from the expanded Thai food processing and feed milling activity. Thai food processors will also be able to save at least 15% on production costs or Bt33.26 million, making them more competitive against other imported food producers. Normally, imported food is more expensive than domestic food. However, due to Thailand’s high pulse import tariffs, domestically processed food made from these raw materials is at present more expensive than imported products. Therefore, the tariff reduction will also decrease food costs for Thai customers. The move will also benefit feed millers, who can use dry peas and other pulses as alternative high quality feed ingredients, or in addition to corn and soybeans,” the AgriSource study said. “Currently, our raw material costs are higher than our ASEAN competitors because we have to pay high import tariffs on peas. We cannot compete with them, even in the Thai market. At the current tariff levels, we would have to seek alternatives when the Asian Free Trade Area (AFTA) takes effect in 2007. Firstly, we may have to close business here and lay off staff. Secondly, we may have to invest in a new factory in another ASEAN country,” a Thai snack food producer said. About AgriSource AgriSource Co. Ltd., is a Bangkok-based food and agribusiness consulting company specializing in market research, trade and business development, economic analysis, and project management. Since the consultancy was founded in 1989, AgriSource has managed projects in Thailand and other Asian countries for a broad range of clients, including leading international food and agribusiness companies, commodity trade associations, and trade-related government agencies. For more information, please contact: Hataithip Nuntiya, AgriSource Co. Ltd., Tel: 0-2251-8655 Arjaree Suwangool, Penner-Madison & Co., Ltd., Tel: 0-2716-5246 ext. 121 End. --InfoQuest (NM)--

• ข่าวAgriSource
• ข่าวo:event
• ข่าวo:eco
• ข่าวen