Press Releases

Salceda urges DTI to encourage fertilizer production; warns of ‘looming global shortage’ of inorganic fertilizers and consequences to food supply, prices

December 13th, 2021

House Ways and Means Chair Joey Sarte Salceda (Albay, 2nd district) urged the Department of Trade and Industry (DTI) to ensure that the production of fertilizers is an incentivized activity under the Strategic Investment Priorities Plan (SIPP), the list of sectors that are qualified for tax perks under the Corporate Recovery and Tax Incentives for Enterprises (CREATE), which Salceda also principally sponsored.

“Mark my words, there will be a global shortage of synthetic fertilizers,” Salceda said, during the Monday hearing of the House tax panel.

“Along with corn prices, this is the major threat to Philippine food supply. These are the most important inputs to both livestock and plant food,” Salceda added.

Salceda earlier chided the DTI and the Board of Investments for delays in the release of the SIPP. Salceda lamented that the delay in issuing the list “drags investor uncertainty over tax incentives to four years already. This is unacceptable.”

Last week, Salceda also gave the DTI and BOI a deadline for the release of the SIPP – by March 2022 – or, the House tax chair says, he will be forced “to use the committee’s oversight powers over CREATE.”

“We have oversight powers over the entire tax code. The SIPP is in the tax code. We will be compelled to call in the DTI and BOI by March 2022, if we don’t see meaningful results in the issuance of the SIPP.”

Organic fertilizers also key

Salceda adds that the production of organic fertilizers, topsoil preservation, and other practices to ensure that agricultural productivity does not decline when inorganic fertilizers become unaffordable to small farmers.

“We need to diversify our fertilizer mix. That includes the production of organic concoctions, which we have already trained thousands of Albay farmers for, anticipating this global shortage of inorganic fertilizers.”

“I think the production of inorganic fertilizers for commercial use should also be included in the SIPP, as fertilizers are. If we will mitigate the effects of the potential shortage and price surges in inorganic fertilizer on food production, we need to have substitutes.”

“The fertilizer price index has increased more than 200% over the past year. I don’t see it abating to pre-pandemic levels anytime soon. If we don’t have enough domestic fertilizer production, our food supply is at the mercy of the global market. 98% of the world’s reserves of phosphate, the main ingredient to inorganic fertilizer, is in just five countries. Morocco, South Africa, Algeria, Senegal and Tunisia possess 98 percent of the reserves of phosphate. Any instability in their supply chains makes us very vulnerable.”

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