March 7, 2005

 

Philippine corn industry gains self-sufficiency

 

 

The Philippines has no plans of importing corn with production hitting a record-high 5.7 tonnes this year.

 

Agriculture Secretary Arthur C. Yap said the Department of Agriculture's (DA) effort to link corn farmers with end-users such as feed-millers San Miguel Foods Inc. and Cargill is seen to sustain production growth in 2005. This, he said, is giving feed millers a comfortable inventory level that is stopping corn imports.

 

"If there are no import plans, it must be because we are linking (corn) producers and users. Also we are still targeting 5.6 to 5.7 million tonnes for 2005," he said in an interview.

 

Yap said the growth will particularly come from a 50,000 to 60,000-hectare expansion.

 

"We are expanding on an additional 50,000 to 60,000 hectares from Region 2 (Isabela, Cagayan), parts of Regions 1 (Ilocos) and 3 (Zambales, Pampanga) and substantially Regions 9 to 12 (Davao provinces, Bukidnon, Zam-boanga, Cotabato)," he said.

 

An official of the Philippine Association of Feed Millers Inc. (PAFMI) said feed millers do not have plans to import corn this year as they have been finding corn quantity sufficient while price and quality are acceptable.

 

"There are lots of supplies. There is a glut in Mindanao, so there are no plans to import. Quality is good. Local price is (down to) about R8 to R8.50 per kilo (from year-ago's R11 to R12 per kilo) because it's already harvest time in February until April. Even if lean months come in June, millers would have already built up stocks which will allow them to last until the next harvest (in August, September)," he said.

 

Because of the glut in Mindanao, industry officials said corn farmers are also considering exporting some volume to prevent a price collapse. Farmers have been asking government for a price support to keep price from falling below P8 per kilo as production cost can be as high as R7 per kilo.

 

The Philippines is seen to sustain a record high growth since it hit a 4.62 million tonnes production in 2003 which rose by a significant 18.6 per cent to 5.48 million tones in 2004. At 5.6 million tonnes in 2005, the industry will still be growing by 2.1 per cent.

 

With the record growth, corn import has been dropping and was down to about 10,000 tonnes in 2004.

 

The PAFMI official said the corn sector's sufficiency is also largely attributable to the slowdown in livestock which has been causing a drop in feed sales by some 20 to 25 per cent.

 

Despite the absence of corn import plans, he said the feed industry is definitely importing corn substitutes that supply nutrients not usually taken from corn.

 

"You get energy from corn, and you get the protein from soybean meal.

 

Maybe the industry will be importing one million tonnes of soybean meal this year. That already dropped (by about 10 per cent from last year) because the performance of the industry was not very good," he said.

 

He said feed millers will also be importing some 100,000 tonnes of feed wheat this year. In 2004, feed millers imported some 560,000 tonnes of feed from China, India, Australia, and Ukraine.

 

With the lacklustre growth in livestock, Yap said DA is now linking livestock growing with corn growing so as to provide livestock raisers the ready raw material for their feed while giving all these farmers additional income.