April 30, 2008

Philippine fish, meat prices to go up in June over feed price spikes

Filipino consumers are in for the tougher times as prices of fish, meat and chicken are seen to increase by June with local feed millers preparing to hike their product costs on soaring cost of feed inputs such as soy, coconut oil, wheat bran and rice bran.

Philippine Association of Feed Millers, Inc (PAFMI) president Norman Ramos said he is uncertain how much feed prices will increase but it will definitely depend on feed millers if they can absorb the increase in raw materials or moderate their prices. He warned the upward adjustment in feed prices will raise the cost of basic food such as fish, meat and poultry.

Local feed millers had been lamenting of the continual rise of feed inputs-- even the cost of rice bran or darak is also rising because of the increase in palay (rice grain) prices.

Feed millers reveal that supply situation for rice bran would tighten in the lean rice production months of June, July and August.

Rice bran is a source of protein and fibre for feeds. At present it costs only P9.30 (US$0.22) per kilo.

Some feed millers fear that rice bran prices could again hit the historical high of P13.30 (US$0.31) a kilo, which would increase the cost of production of animal feeds.

Ramos, however, clarified that rice bran only constitutes about four percent of the cost of feeds, but he sees the price moving up about a peso to P10.30 or P10.50 a kilo.

He admitted that the cost of other major ingredients such as corn, soy, wheat bran and coconut oil have increased by anywhere from 20 percent to as high as 38 percent.

He also said that the continued increase in crude oil price and movements in the foreign exchange rate have to be factored into the cost of production.

Earlier this year, Ramos warned that the local feed milling sector will face difficult times as production costs have increased by 30 percent.

PAFMII, he said, is not even certain if the feed milling industry would be able to post a growth this year due to the rising cost of production.

US$1 = P42.185 (As of April 29, 2008)