May 1, 2013

 

As local corn farmers are expecting a slightly bigger harvest, Philippine feed millers may reduce feed wheat importation this year by more than a third.

 

This is according to the Philippine Association of Feed Millers, Inc. (PAFMI).

 

Norman Ramos, PAFMI president said feed wheat imports are expected to fall to one million tonnes this year from 1.6 million tonnes in 2012.

 

"The price of yellow corn in the domestic market is more competitive compared to the price of feed wheat in the international market," Ramos said in a telephone interview.

 

The price of yellow corn in the local market is PHP13-13.50 (US$0.32-0.33) per kilogramme, much lower than delivered feed wheat, which sells as much as PHP15 (US$0.36) in Bulacan.

 

Feed wheat is an alternative ingredient used for making animal feeds. Over the past two years, feed millers have preferred feed wheat because of competitive pricing and better quality. Feed millers resort to importation whenever there is a shortage of yellow corn and prices are high.

 

However, Ramos said, bumper harvest of yellow corn in the Philippines over the last few quarters has resulted to more stable prices, making it ideal for feed millers to buy more grains from domestic sources.

 

As of the first quarter of 2013, feed wheat arrivals reached only 200,000 tonnes. "If the scenario continues until the third quarter of 2013, we may no longer need to book additional feed wheat imports," Ramos said.

 

The industry normally books feed wheat imports around January-June, which will arrive at the later part of the year. But Ramos said the third quarter harvest for corn remained crucial for the industry, adding that they remained open for feed wheat imports if prices of yellow corn will increase as a result of the typhoon season.

 

"We remain open to importing alternative feed stocks, as long as these are cheaper. It all depends on the prices of yellow corn in the local market. But at the moment, there will be no additional imports," he added.

 

For soy, Ramos said feed millers are looking at bringing in some 1.8 million tonnes of the grain, roughly the same amount as the last two years. While the Philippines grows corn abundantly, it does not produce soy, one of the main ingredients in making feeds.

 

The typical animal feed used by local hog growers is composed of 50% corn, 25% soymeal from soy, and 25% polard, plus multivitamins, fish meal and coconut oil.

 

Earlier, Bureau on Agriculture Statistics (BAS) showed that corn production may reach 3.19 million tonnes in January-June 2013, lower by 7.9% than the 3.47 million tonnes output in 2012.

 

Harvest area is expected to go down to 1.06 million hectares, 5% lower than the previous year's 1.11 million hectares; while yield per hectare may drop from 3.12 tonnes in 2012 to 3.02 tonnes in 2013.

 

For the first quarter of 2013, corn production is estimated to reach 2.2 million tonnes, higher by 9.1% than the output of 2.02 million tonnes in 2012. Harvest area is also expected to grow by 7.7% or from 651,000 hectares in 2012 to 701,000 hectares in 2013; while yield may improve from 3.10 tonnes per hectare to 3.14 tonnes per hectare.

 

"The probable gain in output during the period is biggest in Cagayan Valley at 246,000 tonnes. This could be attributed to early plantings to avoid the adverse effects of the impending El Niño phenomenon and the sustained usage of GMO (genetically-modified) and modern OPV (open pollinated varieties) seed varieties," BAS said.

 

The April-June 2013 forecasts based on farmers' planting intentions indicate reductions in production, harvest area and yield by 31.7%, 23%, and 11.3%, respectively.

 

"The probable movements of harvests from the second quarter to the first quarter as noted in almost all regions and the adverse effects of typhoons Pablo and Quinta in other regions may contribute to the overall decrease during the second quarter of the year," the agency said.