The Department of Agriculture (DA) is taking a cautious stance on the recently concluded US-Philippines trade agreement, as Secretary Francisco Tiu Laurel Jr. said Wednesday that it was too early to assess its implications for Philippine agricultural exports and rural producers.
Under the new trade arrangement, the Philippines has agreed to lift tariffs on American goods entering the country, while Philippine exports to the US will face a 19-percent tariff — an uptick from the initially proposed 17 percent, but lower than the 20 percent rate later floated by the White House.
“Whether the Philippine agriculture sector will gain or not from this trade deal with the US remains to be seen, especially as many of our competitors are still negotiating for better terms,” Laurel said.
The DA is particularly concerned about how the zero-tariff entry of US agricultural products — particularly feed grains and cereals — may affect domestic producers and supply chains.
While lower import costs could benefit livestock and poultry growers by reducing production inputs, the department is evaluating potential displacement effects on local corn farmers and feed producers.
Laurel said the DA will closely monitor import volumes and price movements in the coming months to determine the actual market behavior following the implementation of the deal.
The US has lowered the tariff on Indonesian goods to 19 percent from 32 percent, while Vietnam secured a 20-percent rate, significantly lower than its earlier proposed 46 percent.
Meanwhile, Thailand and Cambodia remain in talks, with a proposed 36-percent tariff still on the table.
Despite a $3.98-billion overall trade surplus with the US in 2024, the Philippines recorded a $1.9-billion agricultural trade deficit, narrowed from the $2.36 billion in 2023.
The country’s top agricultural export to the US last year was coconut oil, which brought in $558.7 million. On the import side, key US agricultural goods included animal feed ($1.36 billion), cereals ($838.1 million), and other food and live animals ($384.1 million).
The DA said it sees potential benefits from cheaper US agricultural imports, especially in achieving President Ferdinand Marcos Jr.’s food security goals. Lower feed and cereal costs may help reduce farm input prices and stabilize local meat and poultry supply.
Still, the department is urging caution, stressing the need for strong safeguards to protect local producers — especially smallholder farmers — from being edged out by increased competition.