The Food Terminal Inc. (FTI), an attached agency of the Department of Agriculture (DA), is encouraging more hog farms to participate in a pilot initiative aimed at bringing down pork prices and curbing excessive markups in the supply chain.
FTI president Joseph Lo said that since the program launched on March 31, participating retailers have been able to sell pork cuts at prices at least P20 below the P380 per kilogram maximum suggested retail price (MSRP) for liempo and P350 for pigue and kasim.
Under the pilot, the local unit of Thailand-based Charoen Pokphand Foods Plc supplies 100 live hogs daily to a slaughterhouse in Caloocan.
Distributors then source pork directly from the facility, eliminating the need for multi-farm transport and significantly cutting logistics costs and generating savings for both retailers and consumers.
“The pilot test has been very successful. Over the first 21 days, we’ve handled more than 2,000 pigs, and participating sellers have been able to price liempo at P360 per kilo, and kasim and pigue between P330 and P340 per kilo. We are inviting more hog farms to join this program. FTI guarantees prompt and proper payment,” Lo said.
FTI also aims to complete the DA’s cost-tracking system by Mau, which will monitor hog movements from farms to retail. The system is intended to promote fair profit margins throughout the supply chain while preventing undue price inflation.
“We see a farm gate price above P230 per kilo as a red flag for profiteering. A fair profit would be a margin of P50 to P65/kg or about P5,000 to P6,500 per 100/kg pig,” Lo said, noting that current data show that raising a pig costs between P165 and P180 per kilogram.
Despite this, compliance with the MSRP remains low, said DA assistant secretary for consumer affairs Genevieve Velicaria-Guevarra.
In recent joint inspections by the DA and Department of Trade and Industry (DTI) across 10 markets, only about 20 percent of vendors adhered to the pricing guidelines.
Guevarra cited high farm gate prices and multiple added costs as reasons for the poor compliance.
“We’re issuing notices this week to stakeholders, asking them to explain their failure to meet the MSRP. We’re also working closely with the DTI, which has enforcement authority on pricing issues,” said Guevarra.
