The Bureau of Product Standards may face charges for issuing an alleged “provisional import clearance certificate” to a 5,000-metric-ton shipment of reinforcing steel bars from China that lacks permits and proper documents.
The Philippine Iron and Steel Institute said it would also demand for a re-test of the shipment despite the conduct of a prior testing on April 25 and reports from the Bureau of Customs that the products were fully unloaded on April 28.
“We have been questioning this since the first time we complained about this shipment. We’ve written to the Customs, we’ve written to the Trade Department. There is no such thing as provisional ICC,” said PISI president Roberto Cola in a briefing Monday in Makati City.
PISI has asked the government and the Trade Department to seize the shipment that arrived in Zambales province due to unfair trade and questions on the product’s safety.
The organization is set to demand for the results of the quality test supposedly conducted by the BPS on April 25 without any witnesses from Customs and the private sector as well as the one conducted from the country of origin.
Customs has set a hearing to today on the controversial steel bars.
“We will also ask the BPS on what grounds and by what law was they empowered to issue provisional ICC,” said Cola.
The shipment of 5,000 MT of steel rebar was estimated at P95 million. The taxes that should go with it cost about P11.4 million at a 12 percent value-added tax.
PISI said about 250,000 metric tons of steel products in 2014 were smuggled from China. The association has not come up with an estimate for 2015, pending the arrival of trade figures from China.
Chinese steel products are cheap because of the 9 percent rebate from the Chinese government when they export, on top of the other subsidies companies enjoy for being state-owned.
China has a production surplus of about 250 million MT of steel products, or half of the global overcapacity estimate of 500 million tons.
With a production capacity of 20 percent, PISI said the Philippines was vulnerable to shortage.
China is the Philippines biggest source of billets, the semi-processed steel used to produce other steel products such as hot and rolled steel, angle bars, rebar, flat and long steel bars.
The Philippines, with a per capita consumption of 80 kilos against the world average of 225 kilos, consumed about 8.8 million MT in 2015. Rebar comprise nearly half of the demand at 3.8 million MT.
The local steel industry expects demand to grow by 7 percent to 8 percent.
“There is pent-up demand in housing and infrastructure. After the property crisis in the late ‘90’s, construction has never really expanded until in the last five years starting 2010,” Cola said.