February 3, 2014

Philippines may export corn due to excess supply
 

In order to help stabilise supply amid anticipated over supply, the Philippines' Department of Agriculture (DA) will propose to the National Food Authority (NFA) Council about the export of corn grains by local farmers.

DA secretary, Proceso Alcala, said that allowing local growers to export their produce would also provide the industry with an "elbow room" before full implementation of the Association of Southeast Asian Nations Free Trade Agreement (AFTA) by 2015.

"We must allow shipments of corn grains so that farmers will not be discouraged to plant if ever there is a glut in production, which may result in lower prices," Alcala said.

Earlier, Alcala said that the government is now positioning the Philippines to be one of the major exporters of corn in the Southeast Asian region within the next three years.

"While we are already self-sufficient, we are reviewing our production targets because we need to expand corn cultivation areas as the livestock sector is growing. We need to align it with the Asean Free Trade Area," Alcala said.

He said that demand for corn from local livestock and poultry sectors continued to increase, as Korea opened its doors for chicken export, while Japan allowed shipments of peking ducks from the Philippines.

Alcala also said that the Philippines is looking at Malaysia as one of the major destinations of corn shipments. To date, Malaysia is importing corn from the US.

For this year, Alcala said the DA is investing heavily on infrastructure and more on post-harvest facilities to prepare the corn industry for trade liberalisation. The Philippines is a signatory to the AFTA, which will take full effect in 2015. The agreement aims to bring down to zero the duties on products coming from ASEAN countries.

In 2013, the country's corn production dropped by 0.4%, at 7.38 million tonnes, compared to 7.1 million tonnes in the previous year, due to the contraction in harvest area as a result of insufficient soil moisture in the first half of the year, and damage caused by strong typhoons in the second half.

However, the DA expects production to bounce back strong this year, noting that production is expected to increase 9.8%, at 3.65 million tonnes in the first semester of 2014.