May 28, 2009

The Philippine government has approved an increase in support price for corn to PHP13 (US$0.27) a kilogramme to help farmers tide over a slump in commodity's price due to zero-tariff wheat imports.

 

Department of Agriculture (DA) secretary Arthur Yap announced that the government will buy as much as 300,000 tonnes of corn at the support price of PHP13/kg during the main harvest season in August.

 

Yap said the government would have to earmark PHP3.9 billion for 300,000 tonnes, adding that the new support price should be a "powerful incentive" for corn farmers to increase their production.

 

Prior to the announcement, the National Food Authority (NFA) bought corn for PHP11.50/kg when the support price for white corn was at PHP13.

 

Corn farmers, led by the Philippine Maize Federation (Philmaize) complained that they are incurring losses as the buying price was at the PHP7 minimum per kilogramme.

 

Philmaize president Roger Navarro said the prevailing farmgate price is a far cry from the PHP12/kg registered last December, or a month before the duty-free importation of feed-grade wheat was allowed.

 

Navarro said farmgate price of corn went down to between PHP7/kg and PHP8/kg, adding that that they are seeing the effect of the duty-free importation of feed-grade wheat which the government has allowed without prior consultation from those who will be affected.

 

In its latest report, the Bureau of Agricultural Statistics (BAS) projected that corn production from April to June would drop by 1 percent to 1.28 million tonnes, while harvest area and yield are expected to decline by 0.61 percent and 0.39 percent, respectively.