January 15, 2009

Poultry growers in the Philippines are warned that broiler production may not reach its 20 percent target growth this year if corn supply shortfalls would not be immediately addressed.

 

According to Gregorio San Diego Jr. of the United Broiler Raisers Association, the high cost of feeds caused by the shortage in corn could prompt a number of small poultry raisers to go out of business.

 

The government had earlier anticipated the sector's production to reach as 523 million kilogrammes of chicken in 2008. But because of the losses incurred, San Diego doubts that the industry produced that much last year.

 

At the average price of P13.32 for yellow corn registered in 2008, he noted that small poultry raisers are already losing as much as P11 per kilogram of liveweight chicken. Prices have risen to as much as P26 per kilogram in Bulacan trading stations due to shortage.

 

Prices of substitutes also skyrocketed as feed millers turn to other feed materials in a span of few days. San Diego noted that feed wheat is now sold at P20 per kilo, from P13 per kilo registered just before the end of 2008.

 

He noted that it would be very easy for small poultry raisers to go out of business as production cycle is shorter at 60 days.

 

As a short-term remedy, UBRA and the National Federation of Hog Farmers Inc. (NFHFI) submitted a petition letter to the Department of Agriculture (DA) to allow duty-free importation of 300,000 tonnes of yellow corn.

 

According to Renato Eleria, vice chairman of NFHFI, they made a similar appeal in December for tax-free corn imports but the government rejected it on Friday (January 9).

 

UBRA and NFHFI said they would still pitch for the duty-free importation of yellow corn to make their production costs more competitive and consequently make their produce more affordable to consumers.

 

Both groups also criticised the DA for its alleged failure to warn them of corn shortage supply. Had they been warned, San Diego said, they would have taken up the remaining minimum access volume (MAV) for corn in 2008.

 

He said it is already too late for the livestock and poultry sector to avail themselves of the remaining MAV for 2008 as its validity would expire today, January 15.

 

As a long-term solution, the Egg Board, Ubra and NFHFI also pushed for the provision of affordable credit to encourage farmers to plant.

 

In a statement, the groups said grain farmers are the victims "of what we call in the vernacular lagaring hapon. They are constrained to borrow capital at 5 percent a month for four to five months, and at harvest time, are at the mercy of lenders, who are, at the same time, traders of corn."

 

UBRA and NFHFI are also against the government's resorting to importing chicken and pork from other markets to ease the tightness in supply and high prices. San Diego said this would further cause losses among those in the livestock and poultry sector.

 

Figures by UBRA showed that as of November 2008, the Philippines imported close to 103 million kilos of various pork products, including choice cuts. The country also imported 40.55 million kilos of chicken products as of November 2008.

                    

US$ 1 = P47.4158 (January 15)