THE Department of Trade and Industry (DTI) is imposing a provisional safeguard measure of P3,438 per metric ton (MT) on imports of corrugating medium, effective for 200 days.
In an order, the DTI said the preliminary investigation found a “causal link between the increased imports of the products under consideration and serious injury to the domestic industry.”
“The increased volume of imports, both in absolute terms and relative to domestic production, was found to be the substantial cause of the overall impairment in the operations of the local industry,” it added.
Made from a high percentage of recycled paper, corrugating medium is used in corrugated box packaging.
The DTI is acting on a petition filed by the Pulp and Paper Manufacturers Association of the Phils. (PULPAPEL), which accounts for 90% of the total domestic production of corrugating medium.
According to the DTI’s preliminary report, imports of corrugating medium significantly increased between 2019 and 2023.
“Over the period of investigation, the volume of imports grew by approximately 71%… In 2023, imports rose to 99,671 MT,” it said.
“In 2024, imports increased further by 28% compared to 2023, marking the highest level during the period. The 2024 import volume is also 1.71 times higher than the 2019 pre-pandemic level,” it added.
According to the DTI, this reflects a recent, sudden, sharp, and significant increase in imports in absolute terms.
The biggest suppliers of corrugating medium are Japan, Indonesia, Australia, Vietnam, and China.
Last year, Japan accounted for a 54.52% share of total Philippine imports, or 69,713 MT, followed by PROC (32.55%), Vietnam (4.97%), and Indonesia (4%).
During the period, the DTI said the share of imports represented a significant share in proportion to production.
“While domestic production slightly increased, imports grew at a significantly faster rate, outpacing production growth. In 2024, the share of imports relative to domestic production increased further,” it said.
The investigation also showed price depressions of 14.78% and 12.83% in the last two years and a price suppression of 1.62% in 2024.
“The condition of competition shows that the market share of locally produced corrugating medium was essentially displaced during the investigation as the share of imports in the Philippine market significantly increased,” the DTI said.
It said the industry suffered loss of market share, declining utilization, reduction in employment, and incurred losses.
“If the surge in imports continues, local industry will lose market share to cheaper imported products. Without the corrugating medium industry, consistency and availability of local supply will be imperiled,” it added.
The safeguard measure on imports of corrugating medium covers ASEAN Harmonized Tariff Nomenclature Codes 4805.19.90 and 4805.12.00 will take effect after the issuance of the relevant Customs Memorandum Order/Circular.
It does not apply to imports originating from developing countries, the DTI said. — Justine Irish D. Tabile