Possible Import Tariff Surcharge for Corn & Chicken Imports from Argentina

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Possible Import Tariff Surcharge for Corn & Chicken Imports from Argentina

29 March 2012

CHILE and ARGENTINA - Chile's National Farm Bureau (SNA) is asking for surtax for corn and chicken imports from Argentina to avoid an estimated loss of over US$100 million for corn producers.

During the next week, the SNA will request to the National Commission of Distortion to apply an additional duty on corn and chicken from Argentina, according to a USDA Report.

Specifically, 25 per cent additional duty for imports of corn with high percentage of cracked kernels and 30 per cent for feed mixtures with a significant content of cracked corn and also 15 per cent surcharge duty for imports of chicken from Argentina.

The National Commission of Distortion is a technical body, composed of representatives of the public economic sector, whose role is to advise the President on matters which are related to the imports of goods, with distorted prices, which cause or threaten serious injury to the domestic production.

Argentina has recently implemented policies that have artificially lowered the price of its corn and today it is 41 per cent lower than the international reference value. As it was emphasized by SNA’s president Patricio Crespo; this is an unfair competition for Chilean farmers, if no actions are taken. Chilean corn growers could lose as much as US$108 million, he predicts.

Hence, the organization (SNA) requested immediate action because the grain harvest will start later this month and be completed by early May. Currently, imports from Argentina have virtually zero tariffs. According to the Santiago Chamber of Commerce, the effective tax paid for imports from Argentina is 0.2 per cent on all imports.

Corn is the second most important crop of the country; it is planted from Rancagua through to Los Angeles, it represents 20 per cent of total annual plantings. Most producers are small farmers. Only one out of ten framers plants areas larger than 30 hectares. As it is stressed by Ema Budinich research manager of SNA, Chilean farmers are the most efficient corn producers in the world. Last 2010/2011 production season average yields reached a record figure of 11.2 metric tons per hectare.

Corn is the basis for the Chilean poultry industry: 70 per cent of total cost are linked to corn. As a result we therefore are asking the Government of Chile to take measures to eliminate distortions in the production chain, from the cracked corn, mixtures containing this corn and chicken production, as was stated by Patricio Crespo.

TheCropSite News Desk

Economics, Corn / Maize, Markets/Economics