ࡱ>  k|M )bjbj== PWW4oln n n n v jjj8kk4v Jnp(pp qb~4$Xɷ˷˷˷˷˷˷$4 TX {z@~"n n p q n pL qɷɷ`vR] = qn 0Gv X]jjQ=0Jo =  n n n n    Voluntary Report - public distribution Date: 8/19/2004 GAIN Report Number: RP4039 RP4039 Philippines Product Brief Fresh Fruits and Vegetables 2004 Approved by: Dennis Voboril  FAS Manila Prepared by: Paulo Campos III  Report Highlights: The Philippines imported 134,000 metric tons of fresh fruit at a value of $55 million in 2003. It is one of the top twenty export markets for U.S. grapes, apples, oranges, cherries, mandarins, and lemons and limes. Fresh vegetable imports have skyrocketed in recent years, due to increased demand from the fast food and HRI food service sector. Prior to 2004, most imported vegetables were brought in from Australia, as the Philippine government did not issue import licenses for U.S. vegetables. In January 2004, however, the government began allowing the importation of U.S. vegetables, and this means that demand for U.S. vegetables will increase tremendously in the near future. The growth of the urban middle class, proliferation of US-style supermarkets, the trend towards health consciousness, and the exorbitant growth of the fast food and HRI food service sector all signal that there will be increased demand for fresh fruits and vegetables in the coming years.  Includes PSD Changes: No Includes Trade Matrix: No Unscheduled Report Manila [RP1] [RP] Overview of the Market Fresh Fruits The Philippines produced 12 million metric tons of fresh fruits in 2003, primarily concentrated in bananas (5.5 million metric tons), pineapples (1.6 million metric tons), and mangoes (850,000 metric tons) for export. Despite the abundance of tropical fruits that can be found in the Philippines, there is still a substantial niche market for citrus, deciduous and other fruits such as grapes and strawberries. In fact, imported fresh fruits such as apples, table grapes and oranges are often lower priced than many domestic fruits. This is in large part because of strong export demand for Philippine fruit in Japan and other Asian countries, as well as the seasonality of tropical fruits (March to May). There will always be year-round demand for imported fresh fruit, but demand for imported fruit peaks from November to February. The Philippines imported 134,411 metric tons of fresh fruits in 2003, totaling $55 million. The two main fruits imported in 2003 were grapes ($16 million worth) and apples ($25 million worth). China and the United States were the two primary sources of fresh fruit imports. The U.S. exported 20,000 metric tons of fresh fruits to the Philippines in 2003, worth roughly $17.4 million. The Philippines has long been a major importer of fruits from the U.S. In terms of 2003 U.S. fruit exports, the Philippines was the: 7th largest export market for U.S. grapes 11th largest export market for U.S. lemons and limes 12th largest export market for U.S. oranges 14th largest export market for U.S. mandarins 16th largest export market for U.S. apples 18th largest export market for U.S. cherries. In recent years, however, fresh fruit imported from China has been steadily changing the face of the Philippine fruit market. China is now the primary source of fresh fruit imports to the Philippines, having exported 103,000 metric tons ($32 million in value) to the country in 2003. Chinas main fruit exports in 2003 were apples ($23.5 million in value) and mandarins ($5.7 million in value). The success of Chinese fruit imports can be primarily attributed to the price-competitiveness of Chinese fruits, but improvements in quality in recent years have also helped to challenge imports from other countries such as the U.S.  Import Sources for Selected Fruits, 2003.FruitPrincipal Import Source (% of total value)OrangesUSA: 91%ApplesChina: 90%; USA: 8% GrapesUSA: 79%; Chile: 14%MandarinsChina: 73%; Argentina: 19%PearsChina: 90%PlumsUSA: 83%CherriesUSA: 97%StrawberriesUSA: 100%Grapefruit USA: 53%; China: 47%Lemons and LimesUSA: 75%; Argentina: 12% Fresh Vegetables Filipinos consume roughly 5 million metric tons of fresh vegetables annually. Most of the vegetable produce consumed is produced locally, with only 77,000 metric tons imported from abroad in 2003. However, vegetable imports have seen extraordinary growth rates since trade liberalization in the mid-1990s, with the amount of fresh vegetables imported having grown ten-fold from 1996 to 2003. Traders import and supply the Philippines fast food chains, hotels and restaurants, and some supermarkets that require a wide variety of high quality fresh vegetables and consistent supply. Prior to January 2004, the government did not issue import licenses for US vegetables. However, the government is now allowing the importation of US vegetables, and thus demand for US vegetables will skyrocket in the near future. In 2003, the U.S. exported $62,000 worth of fresh vegetables to the Philippines. Currently, Australia is the primary supplier of imported vegetables, capturing the bulk of the market share. In terms of lettuce, head lettuce, celery, mushroom, cauliflower, broccoli, and truffle imports, Australia provides close to 100% of these imported vegetables, at a total value of $2.2 million. China exported $14.8 million worth of fresh garlic and $2 million worth of onions and shallots in 2003, and is also the primary import source for carrots. Import Sources for Selected Vegetables, 2003.VegetablePrincipal Import Source (% of total value)Lettuce Australia: 100%Head LettuceAustralia: 100%CeleryAustralia: 100%MushroomsAustralia: 97%Cauliflower and Headed BroccoliAustralia: 100%Carrots China: 97%; Australia: 3%Garlic China: 99%; USA: 1%Onions China: 81%; Netherlands: 12%Potatoes Australia: 71% The Philippines also grows limited quantities of temperate climate vegetables such as broccoli, cauliflower, celery and lettuce in elevated areas. Domestic supply and quality of fresh vegetables is not consistent and subject to the weather and other external factors. This provides good opportunities for the U.S. to supply to major players for which consistency and quality are critical. In particular the wet season and lack of quality farm-to-market infrastructure has hindered local producers ability to supply quality product consistently. The demand for these imported vegetables lies primarily with the booming HRI food service sector. The fresh vegetable market in the Philippines is a highly politicized one, with local growers having a vocal and energetic lobby that calls for protection from vegetable imports. Tariff levels remain high, although Australias success in exporting vegetables to the Philippines shows that the demand undoubtedly exists and there is potential for U.S. vegetable exports to expand in the future. Philippine Fruit and Vegetable Market: The Consumer Side Nearly half of a Filipinos daily expenditure goes to food consumption. Fruit and vegetables reportedly account for 11 percent of this food expenditure. Most Filipinos have traditionally done fruit and vegetable buying at wet markets, along with their meats, fish, and other fresh items. Even at these wet markets, imported fruit such as apples, grapes, mandarins, and oranges have long been, and continue to be, a staple at all fruit vendor stalls. Fruit imports generally peak in the months of November to February where Filipinos buy fresh, colorful fruit for Christmas, New Year, and Chinese New Year celebrations. Vegetables feature prominently in most Filipino dishes, along with rice and meat or fish. The market for imported vegetables, however, is primarily in the upscale supermarkets and the HRI food service sector, where urban dwellers demand consistent quality and a varied array of different kinds of vegetables. Manila, with a population of around 12 million, is the center of all import activity and is where most of the demand for imported produce is concentrated. Proliferation of supermarkets will lead to increased demand for imported produce Consumer demand for imported fruits and vegetables will undoubtedly increase in the years to come due to the proliferation of modern supermarkets in major urban centers such as Manila, Cebu, and Davao. According to industry data, the number of modern, large-scale supermarket outlets has grown by around 30 percent in the past five years. A recent survey about the industry done by international marketing research company ACNielsen found that many consumers now prefer shopping in modern stores (hypermarket, supermarket, department stores, convenience stores, online shopping) as compared to traditional outlets wet markets, fish/butcher shops, sari-sari stores. The survey, done between September and October 2003, showed more Filipino consumers prefer to shop in so-called modern establishments. A total of 67% of survey respondents said they spend over half of their grocery purchases in any one modern store. A smaller 27% prefer to shop in traditional outlets while 6% do mixed shopping, meaning they shop at both types of modern or traditional outlets. A shift in buying fresh produce from wet markets to supermarkets. Nelda L. Alario, director for retail services of ACNielsen Philippines, noted year-on-year comparisons indicate a shift in buying fresh produce from wet markets to supermarkets. Ms. Alario said many supermarkets are now aware that developing their fresh produce section is key to attracting more customers. Hence, some stores now offer a wider selection of fresh produce at competitive prices, and have rearranged the store interiors to highlight the fresh produce section. One supermarket manager estimates that around 30 percent of supermarket sales come from fresh foods (fruit, vegetables, meat, and seafood).   EMBED Word.Picture.8  Astronomical growth in fast food sector and HRI food service sector will lead to increased demand for imported vegetables. The success of Australian vegetable imports can be attributed to the growth in HRI demand for a varied array of consistently high quality vegetables such as broccoli, cauliflower, and romaine lettuce, as well as the increased exposure given to fresh produce generally in supermarkets. In fact, a number of large hotels and supermarkets have begun to import fresh vegetables directly in order to ensure a reliable supply of quality vegetables. The demand for fresh vegetables is expected to increase due to the growth of the fast food industry and increasing health consciousness among consumers. Vegetables imported from Australia are mainly supplied by airfreight, thus U.S. exporters would have an opportunity to ensure quality vegetables by doing the same. Increasing health consciousness of the urban middle class Another trend that will lead to increased demand for fresh imported produce of high quality is the increasing health consciousness of urban dwellers and especially among the growing middle and upper classes who do nearly all their shopping at supermarkets. Opportunities and constraints for U.S. fruit and vegetable exports to the Philippines OpportunitiesConstraintsSize of imported fruit market: $55 million in 2003; constant, year-round demand for imported fruitsSize of imported vegetable market: $20 million of which $16.5 million is concentrated in garlic, onions and shallots The Philippine government began issuing import licenses US vegetables in Jan. 2004 Challenge of cheap Chinese fruit imports whose quality is steadily improving Quality of U.S. Produce; Seasonality of local fruits and inconsistent quality of locally grown vegetablesChallenge of Australian vegetable imports: near 100% market share for most key imported vegetables Growth of urban middle class and associated changes in consumer preferences for quality and varied tastesDomestic vegetable growers are lobbying government for hike in vegetable tariffsEver-increasing popularity of Western-style supermarkets where fresh produce is featured at the front of store Need for import licenses: can be a politicized process Increasing demand for imported produce at fast food outlets, hotels, restaurants as urban dwellers dine out more oftenDemand concentrated in major cities: mainly Metro Manila (population: 12 million) and other major cities (Cebu, Davao)Food regulations are a familiar sight to U.S. exporters. U.S. FDA and EPA regulations serve as the main reference for fresh produceCultural affinity for anything American: there will always be demand for fruits such as Washington Apples and California grapes The Fresh Produce Distribution System in the Philippines How Produce moves in the Philippines: Importers are the Gatekeepers Fresh fruits and vegetables are brought in by importers/traders for distribution either to wholesalers or direct to retail and institutional outlets such as supermarkets, hotels, restaurants and fruit stalls throughout the country. Currently, only a few retailers, hotels, and fast food chains import fresh fruits and vegetables directly, although this is an increasing trend. Most imported fruit arrives at one of the two major ports in Manila and is distributed by around a dozen key importers throughout the Philippines. Mandy Saracho, the Managing Director of the marketing firm that is the Philippine representative of the Washington Apple Commission and the California Table Grape Commission, describes this select group of key importers as the gatekeepers to the imported fruit and vegetable market. These importers absorb all the risk and have the government connections and established relationships with wholesalers and retailers. It is these key importers who determine what is imported, as they supply the major supermarkets, wet markets, and wholesalers who then supply the HRI food service or fast food sectors. Philippine retailers and food service companies rarely buy direct from overseas companies due to the lengthy paperwork associated with importing. There is a lack of a sufficient cold-storage system and distribution of both local and imported fruits and vegetables are often done in non-refrigerated containers. In short, U.S. fruit and vegetable exporters looking to enter the Philippine market should contact one of the major importers (see Contact List in the Appendix), as they will take care of the necessary paperwork, government requirements, and distribution to retailers, wholesalers, fast food outlets, and the HRI food service sector. Costs and Prices Market Prices The following is a guide to the market prices of fresh fruits and vegetables as sold in supermarkets. Prices were taken in July of 2004. The conversion rate used was 55 Pesos to 1 US dollar. The prices of mangoes and bananas have been included as well to serve as a point of comparison. Imported FruitsSupermarket Prices Oranges$1.60/kgApples$1.60/kgGrapes$2.80/kgCherries$17/kgPlums$3.25/kgLemons$.90/kgMandarins$1.75/kgGrapefruit$2.05/kgStrawberries$2.75/8 piecesKiwis$4.15/kg Pears$.76/kgNectarine$3.00/kg Local Fruits Mangoes$1.25/kgBananas$.60/kg Vegetables Supermarket Prices Iceberg lettuce$3.00/kgHead lettuce$2.10/kgRomaine lettuce (pre-packaged) $4.50/kg Celery$2.00/kgMushroomsButton: $3.60/kg Shitake: $5.50/kg Oyster: $3.00/kgCauliflower$1.60/kgBroccoliLocal: $2.50/kg Australia: $8/kgCarrots$1.20/kgOnions$.75/kgTomatoes$1.80/kg  Price/Cost Schedule and Mark-ups In terms of the price/cost schedule, importers all say that there is no fixed mark-up percentage at each stage of the importation process. The mark-ups that importers will add on to the CIF price will vary tremendously depending on the demand for imported fruits and vegetables and the timeframe in which they seek to clear their inventories. Applied Tariff Schedule for 2004-2005 Tariffs on Imported Fresh Fruits, 2004-2005 H.S. CodeDescription200420050803.00 00Bananas, including plantains1515 0804.Dates, figs, pineapples, avocados, guavas, mangoes and mangosteens, fresh or dried.   0804.10 00Dates33 0804.20 00Figs33 0804.30 00Pineapples1010 0804.40 00Avocados1515 0804.50 00Guavas, mangoes, and mangosteens1515 0805 Citrus fruit, fresh or dried0805.10 00Oranges1010  0805.20 00Mandarins (including tangerines)1010  0805.40 00Grapefruit 7 70805.50 00Lemons and limes1010 0805.90 00Other1010 0806.10 00Grapes, fresh77 0806.20 00Grapes, dried 33 08.07 Melons (including watermelons) and papaws (papayas), Fresh0807.11 00Watermelons1515 0807.19 00Other1515 0807.20 00Papaws (papayas)1515  Apples, pears, and quinces, fresh. 0808.10 00 Apples7 7  0808.20 00Pears and quinces77 Apricots, cherries, peaches (including nectarines), plums, and sloes, fresh.    0809.10 00Apricots770809.20 00Cherries770809.30 00Peaches, including nectarines770809.40 00Plums and sloes 77 Tariffs on Imported Fresh Vegetables, 2004-2005H.S. CodeDescription20042005 Potatoes, fresh or chilled 0701.10 00Seeds11 0701.90Other   0701.90 10In-Quota4040 0701.90 20Out-Quota4040 0702.00 00Tomatoes, fresh or chilled1010  Onions, shallots, garlic, leeks and other alliaceous vegetables, fresh or chilled 0703.10Onions and shallots4040  0703.20Garlic4040  0703.90 00Leeks and other alliaceous vegetables2020 Cabbages, cauliflowers, kohlrabi, kale and similar edible brassicas, fresh or chilled 0704.10 00Cauliflowers and headed broccoli25250704.20 00Brussels sprouts33 0704.90Other   0704.90 10Cabbages4040  0704.90 90Other77  Lettuce and chicory, fresh or chilled  Lettuce   0705.11 00Cabbage lettuce25250705.19 00Other2525 Chicory   0705.21 00Witloof chicory20200705.29 00Other2020 Carrots, turnips, salad beetroot, salsify, celeriac, radishes, and similar edible roots, fresh or chilled0706.10 00Carrots40400706.20 00Turnips20200706.90 00Other20200707.00 00Cucumbers and gherkins, fresh or chilled2020 Leguminous vegetables, shelled or unshelled, fresh or chilled0708.10 00Peas20200708.20 00Beans20200708.90 00Other leguminous vegetables1010  Other vegetables, fresh or chilled 0709.10 00Globe artichokes33 0709.20 00Asparagus1010 0709.30 00Aubergines1515 0709.40 00Celery other than celeriac2020 Mushrooms and truffles   0709.51 00Mushrooms1010 0709.52 00Truffles33 0709.60 00Fruits of the genus Capsicum or of the genus Pimenta20200709.70 00Spinach, New Zealand spinach and orache spinach20200709.90Other   0709.90.10Maize (sweet corn)1515 0709.90.90Other1515Source:  HYPERLINK "http://www.tariffcommission.gov.ph" www.tariffcommission.gov.ph Exporting Fresh Produce to the Philippines Issues for Exporters Fruits: Price is primary determinant in terms of market success, but proliferation of supermarkets is creating demand for high quality produce. The first observation that all importers, wholesalers, and retailers interviewed make about the Philippine imported fruit market is that it is price-sensitive: importers all say that their decision-making process surrounding what fruits to import and in what quantities revolve solely around the price foreign exporters can offer them. Importers themselves will choose not to import the premium-grade Class A quality fruits in favor of Class B quality produce in order to simply expand the market and make the price of imported fruits as accessible as possible to their consumers. This is changing with the growth of supermarkets, as their upper-middle and upper class clientele demands quality and are willing to pay a higher price for it. The proliferation of supermarkets and the growth of the middle, upper-middle, and upper classes in recent years have also created new market possibilities for new products such as stone fruit. Many of the more innovative importers are taking chances with small quantities of stone fruit, for example, and this presents an excellent opportunity for U.S. exporters to make further in-roads in the Philippine fruit market. A letter from the Director of the Philippine Bureau of Plant and Industry dated 16 June 2004 reaffirmed the fact that the Philippines is now allowing the importation of fresh cherries from the United States. Competition from Chinese fruit exports is eroding market share of U.S. fruits. A telling example of how price-sensitive the fruit market is in the Philippines is how competition from cheap Chinese apple exports have eaten into the market share of Washington Red apples in recent years. Importers say that Chinese Fuji apples are 40-50% cheaper than U.S. apples, and even though these Chinese apples may not be as good in terms of quality and attractiveness, this cheaper price has resulted in a marked increase in apple imports from China. 1.5 million cartons of Washington Red apples were imported to the Philippines in 1997. Only 300,000 cartons were imported in 2003. Importers say that improvements in the quality of Chinese apples and the fact that they can now be bought all-year round has also been part of the success of Chinese apples in the Philippine market. The lesson is clear: price is the major determining factor as to the success of fruit imports. Importers caution that the situation for grapes today is much akin to that with apples five years ago: U.S. grapes still dominate the market currently, but Chinese grapes are 30-50% cheaper and the quality is steadily improving. Chinese fruit exports also dominate the fresh fruit markets in Indonesia, Malaysia, Singapore, and Thailand. Seasonality of Key Fruit Imports, according to a major importer. ApplesGrapesOrangesMandarinsUS: all-year US: July-JanuaryUS: December-MayChina: October-FebruaryChina: all-yearChile: March-AugustAustralia: June-DecemberPakistan: December-MayAustralia: January-MayChina: August-October Vegetables: The Philippine Government began issuing import permits for US vegetables in January 2004 A major development in 2004 was the Philippine governments issuance of import permits for US vegetables for the first time: prior to January 2004, the government did not issue regular import permits for US vegetables. The Director of the Philippine Bureau of Plant and Industry reaffirmed that US vegetables would be allowed into the country in a letter dated 16 June 2004 to the USDA office in Manila: In the case of permit issuance for US vegetableswe will still allow importation of selected vegetables (Broccoli, Lettuce, Cauliflower, Celery, and Carrots) from the US as the case in the past, subject to the governments importation requirements. The government has issued import permits for Australian vegetables since trade liberalization in the mid-1990s, and thus Australian vegetables have captured the bulk of the market share. However, all major vegetable importers are looking to the US now that the government is issuing import licenses, and thus demand for US vegetables will skyrocket in the near future. Nearly all vegetable importers interviewed said that they were in the process of calculating the costs and benefits of switching their imports from Australian vegetables to US vegetables, and the general feeling seems to be that most vegetable importers will in fact soon source a significant portion of their imports from the US rather than Australia. The Philippines currently imports more than 30 kinds of fresh or chilled vegetables. USDAs Supplier Credit Guarantee Program is providing incentive for importers to source fresh vegetables from the US One importer interviewed said that one of the reasons importers do not necessarily experiment with new import sources is that the established relationships with Australian or US produce exporters allows them to have some sort of credit system whereby they receive the produce first and are allowed to pay later. In response to these kinds of concerns, the U.S. Department of Agriculture has been offering its Supplier Credit Guarantee Program (SCGP) since 1997 to help ensure that credit is available to finance commercial exports of U.S. agricultural products, while providing competitive credit terms to buyers. The Supplier Credit Guarantee Program helps exporters offer direct, short-term credit to foreign buyers of U.S. food and agricultural products. Under this program, USDAs Commodity Credit Corporation (CCC) reduces the financial risk to exporters by guaranteeing a large portion of the payments due from importers under financing arrangements of up to 180 days. The direct credit extended by the exporter to the importer for the purchase of U.S. agricultural products must be secured by a promissory note signed by the importer. USDAs Foreign Agricultural Service (FAS) administers this program on behalf of the CCC, which issues the credit guarantee. The exporter or the exporters bank provides the financing. The exporter negotiates the terms of the export credit sale with the importer. Once a firm sale exists, the qualified U.S. exporter must apply for a payment guarantee before the date of export. Vegetables imported from Australia are brought in via airfreight Importers bring in imported vegetables via airfreight, as this allows them to work with smaller volumes and translates into longer shelf life for the vegetables they import. Also, demand is not yet at the point wherein importing vegetables in 40-foot containers via sea freight is economical. This is in part because importers, the government, and local vegetables growers have an understanding that imported vegetables will not enter the wet markets in order to not affect the prices of locally grown vegetables. In this sense, demand for imported vegetables lies squarely with the HRI food service sector, the airline catering industry, the fast food sector, and the upscale supermarkets. Quality of local vegetables is steadily improving: price is ultra-competitive A future trend that some importers are highlighting is that, thanks to international development assistance focused in Mindanao, the quality of locally grown vegetables is steadily improving. With local vegetables costing only one-third the price of imported vegetables, if quality continues to improve and local growers experiment with a more varied array of vegetables, locally grown vegetables could very well displace some of the demand for imported vegetables. Marketing Strategy for U.S. Produce to the Philippines Fruits Focus on quality of US produce The advantage of U.S. produce relative to cheaper Chinese fruit imports or locally grown vegetables is that U.S. produce has a reputation for being of consistently high quality, both in terms of taste as well as attractiveness on display. A visual comparison of the different produce available at a supermarket or wet market will yield the same conclusion: U.S. produce looks like it is of higher quality and is much more visually appealing than any locally grown vegetables or Chinese fruit imports. Synergy Asia, Philippine representative of the Washington Apple Commission and California Table Grape Commission, has taken this approach to marketing Washington Red apples and California grapes. The promotional strategy for U.S. apples and grapes is focused on highlighting the quality of the product, outlining the origin of the fruits (i.e. the birthplace), building on the Philippines strong ties with the US, and emphasizing the underlining health and nutritional benefits. Synergy Asia believes that this promotional strategy will ring well with the upper-middle and upper class consumers who are increasingly health conscious and who do all their shopping in supermarkets. Focusing on the quality of U.S. produce will also make U.S. produce attractive to the food service sector: Washington Red apples are still the ingredient of choice for the Philippines apple pie producers. Vegetables Quality is important for imported vegetables With the majority of demand for imported vegetables concentrated in hotels, restaurants, airlines, and upscale supermarkets, quality is of great importance. Philippine importers are in the process of seeking US vegetable exporters now that the government is allowing for the importation of US vegetables. They will be looking for good quality vegetables at a price that is competitive vis--vis Australian vegetables, even after all transportation costs are figured in. As Australia currently has the bulk of the market share, US exporters are competing primarily with Australian vegetable exporters, and price and quality will be viewed in light of this. Specialized Niches for Imported Specialty Produce Organic Fresh Produce The Philippine organic industry is relatively small and in its infancy stage. Although it is interesting to note that domestic production is growing between 10-20 percent, locally grown products are limited in variety. It is estimated that demand for organic products, chemical-free, pesticide-free and "natural" products will outpace local production. The domestic organic industry is about $2 million and imports of processed organic food products are estimated at another $3 million. There is generally a lack of awareness and limited distribution for organic products, and distinct price sensitivity for the greater mass of Filipino consumers. However, the niche market, comprised mostly of Filipinos who have traveled or have been influenced into the healthy lifestyle and for the expatriate community does exist and will continue to expand in the future. Food Laws and Regulations Import Regulations for Fresh Produce In response to pressure from domestic vegetable producers to limit imports as well as to crack down on illegal importation of fruits and vegetables into the Philippines, the Department of Agriculture has further tightened its import permit application procedures. In March 2003 through Memorandum No. 18 (MO 18), the Bureau of Plant and Industry (BPI) imposed additional requirements for all import permit applications covering fresh fruits and vegetables. The implementation of these additional checks and authentication processes, oftentimes result in delays of imports of the affected products. BPI regulates imports of fresh fruits and vegetables. All imports of fresh produce require phytosanitary clearances from BPI, which also serve as import licenses. The Philippine importer applies for these permits for each shipment. Shipments of fresh fruits and vegetables must be accompanied by a USDA Phytosanitary Certificate (PC) issued at the port of origin. Import permits for fruits and vegetables need to be secured prior to exportation from the United States. The date of shipment should not be earlier than the import permit. In short, the requirements are: USDA Phytosanitary Certificate accompanying shipment The Container Seal Number must also be stated in the USDA Phytosanitary Certificate The Bureau of Plant Industry Import Permit Number to be indicated in the additional declaration of the accompanying Phytosanitary Certificate. For a comprehensive guide to Philippine import requirements for agricultural products see the GAIN Report RP 4017 entitled Food and Agricultural Import Regulations and Standards published 5 April 2004:  HYPERLINK "http://www.fas.usda.gov/GainFiles/200404/146105898.pdf" http://www.fas.usda.gov/GainFiles/200404/146105898.pdf. References: GAIN Report RP2053: Philippines Exporter Guide, 2003:  HYPERLINK "http://www.fas.usda.gov/gainfiles/200207/145783425.pdf"  http://www.fas.usda.gov/GainFiles/200003/25637328.pdf FAS AgExporter Magazine:  HYPERLINK "http://www.fas.usda.gov/scriptsw/AgxMag/AgxMagazine.asp" http://www.fas.usda.gov/scriptsw/AgxMag/AgxMagazine.asp USDAs Supplier Credit Guarantee Program:  HYPERLINK "http://www.fas.usda.gov/excredits/scgp.html" http://www.fas.usda.gov/excredits/scgp.html Import Procedures The basic procedures for the importation of food and agricultural products are as follows:  STEP 1   STEP 2   STEP 3   STEP 4 Source: GAIN Report RP4017: Food and Agricultural Import Regulations and Standards Appendices Contact List Appendix I: U.S. Foreign Agricultural Service Offices and relevant Philippine Government Agencies Agricultural Affairs Office (AAO)/USDA U.S. Embassy Manila 25/F Ayala Life-FGU Bldg. 6811 Ayala Avenue, Makati City Tel: (+632) 887 1137/53 Fax: (+632) 887 1268 Email:  HYPERLINK "mailto:agmanila@usda.gov" agmanila@usda.gov Agricultural Trade Office (ATO)/USDA U.S. Embassy Manila 25/F Ayala Life-FGU Bldg. 6811 Ayala Avenue, Makati City Tel: (+632) 894 5381 Fax: (+632) 812 5430 Email:  HYPERLINK "mailto:atomanila@usda.gov" atomanila@usda.gov Animal and Plant Health Inspection Service (APHIS) U.S. Embassy Manila 25/F Ayala Life-FGU Bldg. 6811 Ayala Avenue, Makati City Tel: (+632) 840 3276 Fax: (+632) 830 2376 Email:  HYPERLINK "mailto:Rosario.B.Bedana@aphis.usda.gov" Rosario.B.Bedana@aphis.usda.gov Bureau of Plant Industry Department of Agriculture 692 San Andres Street Malate, Manila Philippines 1004 Tel : (+632) 524 2812 Fax : (+632) 521 7650 Website :  HYPERLINK "http://bpi.da.gov.ph/Services.html" http://bpi.da.gov.ph/Services.html Bureau of Customs Department of Finance Valuation & Classification Department New Customs Building Port Area, Manila Philippines 1018 Tel : (+632) 526 6355 Fax : (+632) 527 4573 Website :  HYPERLINK "http://www.customs.gov.ph/html/cover.htm" http://www.customs.gov.ph/html/cover.htm Bureau of Import Services Department of Trade & Industry 3/F Oppen Building 349 Sen. Gil Puyat Avenue Makati City, Philippines Tel : (+632) 896 4430 Fax : (+632) 895 7466 Website :  HYPERLINK "http://www.dti.gov.ph" http://www.dti.gov.ph Bureau of International Trade Relations Department of Trade & Industry 5/F, New Solid Building 357 Sen. Gil Puyat Avenue Makati City, Metro Manila, Philippines 1200 Tel : (+632) 890 5148/ 897 8290 Fax : (+632) 890 4812 Website :  HYPERLINK "http://www.dti.gov.ph" http://www.dti.gov.ph Bureau of Trade Regulation & Consumer Protection Department of Trade & Industry 2/F, Trade & Industry Building 361 Sen. Gil Puyat Avenue Makati City, Metro Manila Philippines 1200 Tel : (+632) 896 5785 Fax : (+632) 890 4949 Website :  HYPERLINK "http://www.dti.gov.ph" http://www.dti.gov.ph National Food Authority 101 E. Rodriguez Sr. Ave. Quezon City Philippines 1102 Tel : (+632) 712 1719/ 712 1705 Fax : (+632) 712 1110 Website :  HYPERLINK "http://www.nfa.gov.ph" http://www.nfa.gov.ph Appendix II: Cooperators and Associations Synergy Asia Marketing Services, Inc. (Philippine representative of Washington Apple Commission and the California Table Grape Commission) Unit 602-C, Summit Office Tower 530 Shaw Boulevard Mandaluyong City 1501 Metro Manila Tel: (632) 534-8534; 534-8221; 534-8223 Fax: (632) 534-8234 Contact: Mr. Mandy Saracho, Managing Director Email:  HYPERLINK "mailto:mandys@synergyasia.com" mandys@synergyasia.com Lieu Marketing Associates Pte Ltd (ASEAN Representative of California Pistachio Commission, California Tree Fruit Agreement, Florida Department of Citrus, Pear Bureau Northwest, Raisin Administrative Committee, United States Potato Board, Wine Institute of California, Western United States Agricultural Trade Association, Mid-America International Agri-Trade Council, Food Export USA-Northeast and the Southern United States Trade Association) Block 3 Alexandra Distripark Unit 08-22, Pasir Panjang Road Singapore 118483 Tel: (65) 6278-3832 Fax: (65) 6278-4372 Contact: Richard Lieu Email:  HYPERLINK "mailto:richelieu@lieumktg.com.sg" richelieu@lieumktg.com.sg Philippine Association of Supermarkets, Inc. Rm 311, Mariwasa Building Aurora Boulevard, Cubao Quezon City, Philippines Tel: (632) 363-4563 Fax: (632) 456-3855 Contact: Mr. Jose Albert, President Hotel and Restaurant Association of the Philippines Suite 200 Hotel Intramuros de Manila Plaza San Luis Complex corner Cabildo Urdaneta St . Intramuros Manila, Philippines Tel: (632) 527-5113 Fax: (632) 527-9927 Contact: Mr. Larry J. Cruz Philippine Food Processors and Exporters Organization Room 304, JS Contractor Building 423 Magallanes St., Intramuros Manila, Philippines Tel: (632) 527-5810 to 11 Contact: Mr. Jesus T. Tanchangco, Sr., President Appendix III: The Private Sector Fruit Importers: Beauchamp Food Corp. a.k.a. Joint Freight (importer, wholesaler) 391 P. Guevarra cor. Argonne St. San Juan, Philippines Tel: (632) 727-1517 Fax: (632) 721-0726 Contact: Mr. Philip Cea, President Email:  HYPERLINK "mailto:bfc@thenet.com.ph" bfc@thenet.com.ph Dizon Farms a.k.a. Jed Marketing (wholesaler, retailer) Bldg 5., Unit 522, Sirloin Road, FTI Complex Taguig, Philippines Tel: (632) 838-9433 Fax: (632) 838-4435 Contact: Ms. Catherine Posas Email:  HYPERLINK "mailto:jedmktg@i-manila.com" jedmktg@i-manila.com Deka Commercial a.k.a. Elite Fruit Marketing (importer, wholesaler) 687 Sto. Cristo Street. Binondo, Manila Tel: (632) 242-5279 Fax: (632) 242-5282 Contact: Ms. Alice Chan E-mail:  HYPERLINK "mailto:deka@compass.com.ph" deka@compass.com.ph Sun Moon Fruits a.k.a. Del Gro, J&G Commercial (importer, wholesaler) 676 Sto. Cristo Street Binondo, Manila Tel: (632) 242-8406 Fax: (632) 242-8396 Contact: Mr. Jimmy Go Email:  HYPERLINK "mailto:smfruits@tri-isys.com" smfruits@tri-isys.com UBM (importer, wholesaler, retailer) 312 Shaw Boulevard Mandaluyong City Tel: (632) 533-6354 Fax: (632) 531-7838 Contact: Fred Uysipuo Email:  HYPERLINK "mailto:freduysipuo@yahoo.com" freduysipuo@yahoo.com Supermarkets/Hypermarkets that import fresh produce directly: MAKRO Philippines Km. 21 East Service Road South Superhighway, Sucat Muntinlupa City Tel: (632) 876-3134 Fax: (632) 876-3140 Contact: Ms. Cecille Tan-Gatue Email:  HYPERLINK "mailto:bf06@makro.com.ph" bf06@makro.com.ph PriceSmart 32nd St. corner 5th Ave., Fort Bonifacio Globaly City, Taguig, Metro Manila Tel: (632) 888-0433 Fax: (632) 888-0689 Contact: Mr. Edward Gonda Vegetable Importers: Leysam Commercial Inc. (importer, distributor, food service) 1547 Leon Guinto St. Ermita, Manila Tel: +632 525-3966 Fax: +632 521-8587 Contact: Ms. Cynthia Ramos Li, Import Manager Email:  HYPERLINK "mailto:leysamci@info.com.ph" leysamci@info.com.ph Tuckerbag Inc. (importer, distributor) 110 Carlos Palanaca St. Legaspi Village, Makati City Tel: +632 817-9786 Cel: +63-917-898-6278 Contact: Martin J. Garcia Email:  HYPERLINK "mailto:mjgarcia@info.com.ph" mjgarcia@info.com.ph Blue Dairy Corp. Sumulong Highway Marikina City Tel: +632 646-9709 to 10 Fax: +632 646-6509 Contact: Ped Miguel, Vice President and General Manager Choice Harvest Marketing Inc. (supplier) 68 Don Pepe St., Sto. Domingo Quezon City Tel: +632 732-5021 Fax: +632 783-7391 Contact: Rosa Tan Sy, General Manager Major Fast Food Chains that import fresh vegetables: Wenphil Corporation (Wendys) 2nd Floor, Unit 2-A, Uni Oil Building Acasia St., Madrigal Business Park Ayala Alabang, Muntinlupa City Tel: +632 809-5506 Fax: +632 807-2394 Contact: Mr. Jose T. Pardo Jollibee Foods Corporation 6th Floor Jollibee Center San Miguel Avenue Pasig City Tel: +632 634-1111 ext. 1169 Fax: +632 634-1190 Contact: Samuel M. Dalisay, Purchasing Manager GAIN Report - RP4039 Page  PAGE 2 of  NUMPAGES 19  UNCLASSIFIED USDA Foreign Agricultural Service Global Agriculture Information Network USDA Foreign Agricultural Service GAIN Report Template Version 2.09  EMBED Excel.Chart.8 \s   EMBED Word.Picture.8   EMBED Excel.Chart.8 \s  The Philippine Imported Fruit Industry at a Glance: Total value of all imports in 2003: $55 million Volume of all imports in 2003: 134,411 m. tons Total value of U.S. fruit exports to the Philippines in 2003: $17,369,268 Total volume of U.S. fruit exports to the Philippines in 2003: 20,151 m.t. Filipinos spend nearly half of their daily expenditure on food 11% of Filipinos food expenditure goes to fruits and vegetables In a recent survey, 67% of respondents reported doing more than half their food shopping at modern establishments What exporters should know: Everything depends on price. Whoever gives the cheapest price gets the business. Fruit importer  EMBED Excel.Chart.8 \s  Only accredited and/or registered individuals or businesses may import food products into the Philippines. Importers must obtain accreditation from relevant Philippine regulatory bodies (i.e., for fresh fruits and vegetables a Certificate of Accreditation from the Bureau of Plant and Industry (BPI) of the Department of Agriculture is required). Determine whether food or agriculture products can enter the Philippines. Only acceptable countries as determined by the relevant regulatory body may export food and agriculture products to the Philippines. Import licenses/permits must be obtained from the relevant regulatory body for the goods to be imported to the Philippines before the products are shipped from the exporting countries. Import Permits (IP) from BPI must be obtained prior to importation. A Certificate of Registration (CR), renewable annually, must be secured from BFAD prior to initial importation. All agricultural and food products entering the Philippines must be accompanied by a phytosanitary or health certificate issued by the regulatory body in the exporting country. 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