Transportation agency orders 40% shipping rates cut on agriculture and food products

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The Department of Transportation ordered shipping firms to provide no less than 40% discount on freight rates for produce and food. A 12% ship’s cargo capacity per voyage was also required to be allocated for such cargoes.

The order came in effect following the issuance of the Department Order 2020-07 by the Transportation Secretary Arthur Tugade on June 24.

According to Sec. Tugade, the reduced shipping rates ensures that the food supply chain is unhampered and that people will be assured of the adequate food supply.

“At this period when the danger of the pandemic is still very real, the people must be assured that the production and delivery of food and agricultural items will not be hampered or delayed. This is important as many parts of the country remain under quarantine measures where movement is restricted,” Sec. Tudage said.

“With this department order, our people will be assured of food supply, as each vessel being operated by a domestic shipping line will be carrying needed food and agricultural products to various destinations in the country.”

Under the order, agricultural and food products are defined as raw or processed commodities meant for human consumption, excluding water, salt, and additives.

Domestic shipping companies are not prevented from extending a higher discounted shipping rate for agricultural and food products transported by their vessels.

Sec. Tugade has ordered the Maritime Industry Authority to issue the guidelines of the order within 30 days of its effectivity. He also ordered the Philippine Ports Authority to ensure that domestic shipping companies comply with the department order, and to impose sanctions for non-compliance.

The transportation department’s action complemented with the Department of Trade and Industry’s priority to ensure food movements flow freely across the supply chain.

“From the very beginning, the stable supply and unhampered movement of all food and non-food cargoes has always been our priority. This is to prevent the unreasonable increase in the prices of goods, especially at this time of the pandemic when sources of income are limited,” said trade department Secretary Ramon Lopez.

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