Marcos orders investigation into onion cartel

DAVAO CITY - President Ferdinand R. Marcos Jr. has ordered an investigation into the smuggling of onion and other agricultural products, calling such acts as being tantamount to economic sabotage.

“I have just given instructions to the DOJ (Department of Justice) and the NBI (National Bureau of Investigation) to initiate an investigation into the hoarding, smuggling and price fixing of agricultural commodities. And this is stemming from the hearing that we’ve conducted in the House, specifically by Congresswoman Stella Quimbo and the findings that they came up with,” Marcos said.

In a Memorandum to the Marcos, Quimbo, who led the Committee on Agriculture and Food hearings at the House of Representatives, said that substantial evidence has been uncovered pointing to the existence of an onion cartel as she shed light on the causes behind the surge in onion prices in 2022.

She said that the cartel, allegedly operating primarily through the Philippine VIEVA Group of Companies Inc. (PVGCI), has engaged in various activities including farming, importation, local trading, warehousing, and logistics.

Marcos emphasized the significance of these findings as sufficient grounds to initiate an investigation, citing the need to address what amounts to economic sabotage. “And that is why we are going to be very, very strict about finding these people and making sure that they are brought to justice,” he said.

The hearings highlighted the sharp increase in onion prices starting in July last year, attributed to a perceived shortage of supply. However, data from the Department of Agriculture’s Bureau of Plant Industry revealed only a modest shortage of approximately 7.56% in 2022, which could not justify the significant inflation rates reaching 87% in December of that year.

Quimbo reported that responses from cold storage facility owners during the hearings also indicated an ample supply of onions during the period of price surges. This led to the examination of an alternative explanation - cartel activity.

The cartel allegedly engaged in price-fixing through manipulation of stocks, leveraging control over cold storage facilities.

During the hearings, Lilia/Lea Cruz, known as the “Sibuyas Queen,” denied involvement in onion importation, stating her participation was limited to trucking and assisting onion farmers.

However, Quimbo said evidence presented in the hearings confirmed Cruz’ heavy involvement in the onion industry. She said Cruz is the majority stockholder of the Philippine VIEVA Group of Companies, Inc. (PVGCI), established in 2012.

PVGCI, along with other major players in the onion industry, is allegedly implicated in cartel operations, including coordination of stock withdrawals and price-fixing at various stages.

Quimbo also presented an “Onion Matrix” which involves several companies engaged in the trading and importation of onions and other vegetables acting in connivance with owners of cold storage facilities.

One of the recommended actions of Quimbo to address the issue effectively is the dismantling of the cartel with the help of the DOJ, the NBI and the Philippine Competition Commission. (Mindanao Examiner)