February 14, 2013

Philippines seeks more investments to strengthen milk industry
 

The Philippine local milk producers need billions of pesos to be able to make a mark on a dairy market dominated by the US, New Zealand, Australia and France. 
 

The National Dairy Authority (NDA) Administrator Grace Cenas said on Tuesday (Feb 12) that the country should support local milk producers if it wants to reduce its imports of milk and other dairy products.

According to her, the dairy - industry value chain's production segment, which covers the breeding of dairy animals and the harvesting of milk, is a priority investment area since it will spur growth in the processing and marketing segments.

"With our need to increase milk output, the production segment needs investment inflows the most," Cenas said. "The market is becoming more demanding and the price of imported milk is cheaper than those produced locally."

Raw milk production rose by 12% to 18.45 million litres in 2012 from 16.45 million litres the year before, exceeding the NDA's target of 10%. Cenas said that though milk production has been growing at an average of 7% annually in the last five years, she wants that figure to breach 10%. Despite these figures, Filipino milk producers only account for about 1% of the country's total dairy-product requirement of 1.8 billion kilogrammes, with New Zealand, the US, Australia and France supplying the balance.

Cenas said local milk production currently satisfies 40% of domestic demand for both processing and consumption. The NDA is trying to raise the country's milk sufficiency level to 43% by 2016 and reach full sufficiency by 2021. With increased milk production, processors could raise its output of processed cheese, which enjoys huge demand.

"This product requires a large amount of milk. With increased milk production, processors will automatically buy local. There is a big demand. With the growing number of pizza restaurants, for instance, there is a huge demand for mozzarella cheese," Cenas said.

To increase raw milk production, the NDA is importing more dairy animals for breeding purposes this year to improve the local stock. More multiplier farms will also be established to increase the breeding stock.

The Philippines has only 40,696 dairy animals, only a little over 4% of the one million dairy animals needed. In 2011 the NDA imported 10 bulls and 2,100 cows for breeding, with their offspring distributed to capable dairy farms.

Cenas said the number of animals to be imported this year would be determined once the animals procured in 2012 have been distributed. She added that dairy zones in the provinces of Batangas, Laguna, Quezon, Iloilo, Negros Occidental and Cebu are being eyed for the new multiplier farms.