April 1, 2009

In 2008, Philippine chicken production, valued at about US$2 billion, increased by 5.76 percent over the previous year, according to a US Department of Agriculture attache report posted Tuesday on the Foreign Agricultural Services Web site.

The growth in broiler production is forecast to slow this year as a result of rising feed and production costs and possible weaker consumer demand. Total chicken meat imports, majority of which was chicken leg quarters and deboned chicken meat, increased only slightly last year. San Miguel Corporation, the largest agribusiness conglomerate in the country, announced plans to expand broiler production by US$68 million.

The Philippine poultry sector, valued at about P131 billion (US$2.7 billion), expanded by 11 percent in 2008 and represents about 14 percent of total agricultural production in the country. Chicken production, valued at P98 billion (US$2 billion) and the primary source of growth in this sector, went up by 5.76 percent. Increased broiler production was particularly noted in dressing plants throughout last year.

According to the Philippine Department of Agriculture's (DA) Bureau of Agricultural Statistics (BAS), another contributing factor to the growth in 2008 was the rehabilitation of typhoon damaged farms in Ilocos Region in Luzon. In the fourth quarter, there were reports of establishment of new broiler commercial farms in Ilocos Norte and increase in the number of contract farms in Northern Mindanao.

According to local broiler associations, the growth in chicken output is expected to slow this year, partially as a result of weak consumer demand, coupled with rising feed and production costs.

Per capita chicken production in 2007 was at 7.86 kg/year decreased slightly from the previous year. Increased production and constant import levels in 2008 are expected to increase per capita consumption in 2008.

According to analysts, the ongoing global economic crisis is expected to dampen consumer food demand in 2009, including chicken consumption. However, concerns about Ebola Reston Virus in pigs may result in some shift from pork to chicken by consumers.

Prices in the poultry sector went up at an average of 5.73 percent. Farmgate prices of chicken in particular recorded a 5.64 percent increment, while that of chicken eggs appreciated by 4.55 percent.

Importation of chicken meat increased slightly in 2008 by 2 percent. Main country sources are Canada (38 percent), the United States (30 percent) and Brazil (18 percent). Last year, imports of chicken leg quarters, in particular, declined by 35 percent while imports of mechanically deboned chicken, used mainly in meat processing, increased by 41 percent. Adequate domestic production of chicken, coupled with the uncertainty caused by the MAV review and delays in the issuance of MAV licenses contributed in part to the decline in chicken leg quarter imports in 2008.