Expiration of anti-dumping duties on Turkish flour will harm the Philippine industry

Flour millers are pushing for the extension of the anti-dumping duties on Turkish wheat flour, which “poses a threat” to the domestic industry.

The Philippine Association of Flour Millers Inc. (Pafmil) said Manila should not allow the anti-dumping duties on wheat flour from Turkey to expire.

“The expiration of the anti-dumping duties would enable Turkish firms which had exited the market due to an inability to compete at their normal prices to regain their foothold in the Philippines and regain market share to the detriment of fairly priced exporters and local producers,” according to the staff report of Pafmil presented at the hearing organized by the Tariff Commission last Friday.

“While the Philippines’s significance as an export market for Turkish wheat flour has lessened through the years due to the anti-dumping duties that are imposed, the Philippines will remain a highly attractive market,” it added.

Local four millers claimed that there is a “well-established” trading relationship between the Philippines and Turkey. Moreover, they said there is increasing domestic demand for wheat flour end-products, such as bread and pastries, which means that competitively priced wheat flour from Turkey will remain “a strong option.”

During the hearing, Rodolf Britanico, counsel for petitioner Pafmil, cross-examined the oppositor, the Southeast Anatolian Exporters’ Association, which was represented by Gülden Bozdeniz.

Britanico questioned Bozdeniz’s presentation, saying there is “no evidence on continuation/recurrence of injury.” To support this claim, Bozdeniz displayed a graph that showed the Philippines’s wheat flour imports from Turkey declined to 3,697 metric tons (MT) in 2022 from 116,592 MT in 2015.

Further, Bozdeniz said that from 2015 to 2020, four Turkish exporters were excluded from the order. After 2020, she said that out of 17 companies, one exporter had been excluded and 8 exporters have dumping margins below 6 percent.

In response, Britanico pointed out that the Philippines imposed the anti-dumping duty on Turkish wheat flour from 2015 to 2020, the same period shown on the graph displayed on the presentation of Bozdeniz.

The imposition of the anti-dumping duty on Turkish wheat flour was extended for another three years or until later this year. It is set to expire on October 27, nearly eight years since the Philippine government had determined the necessity of implementing the trade remedy to protect the local flour milling industry.

The counsel for the local flour millers said, “I just want to put it to you that the decrease or decline of Turkish exports to the Philippines is a result of the anti-dumping duties.”

Britanico cited Section 19 of the Implementing Rules and Regulations (IRR) of Republic Act 8752 or the Anti-Dumping Act of 1999 which states: “An expiry review shall be initiated when there is sufficient evidence that the expiry of the definitive anti-dumping duty would likely result in a continuation or recurrence of dumping and injury.”

“Such a likelihood may be indicated, for example, by evidence of continued dumping and injury or evidence that the removal of injury is partly or solely due to the existence of the duty or evidence that the circumstances of the foreign exporters, or market conditions, are such that these would indicate the likelihood of further injurious dumping,” the provision further noted.

Britanico asked Bozdeniz why she did not show the chart of the situation before the imposition of anti-dumping in 2014.

“For your information, Ms. Bozdeniz, this was the situation before any anti-dumping measures were imposed by the Tariff Commission and the Department of Agriculture of the Philippines. As it shows, the dumping of Turkey rose from 2011 up to 2014,” he said.

Britanico presented a graph that he obtained from the Bureau of Customs (BOC), showing the surge in Turkish flour exports to the Philippines to 143,160 MT in 2014, from 16,721 MT in 2008.

“It was only in 2015 which was actually reflected in your graph that it went down. And I appreciate your discussion about how this dumping went down from 2015. However I would like to repeat …that the decline was due to the imposition of the anti-dumping,” Britanico said.

Anti-dumping is a trade remedy allowed under World Trade Organization agreements. It permits a state to impose additional duties on products that are being exported at a price that is lower than the prevailing market price in the country of origin. The anti-dumping duties allow the price of exported product to be at parity with its home market price level.

Under the extended measure, the Philippines imposed anti-dumping duties on Turkish wheat flour of up to 29.57 percent, depending on the exporter.

Tags: Turkey, Philippines, flour, restrictions