July 8, 2013

In the first quarter of this year, Philippines' dairy exports dropped by almost 98.25% while imports decreased by 7% due to price increases in the world market.

According to data posted on the National Dairy Authority's (NDA) web site, exports in the January-March period fell to 1,070 tonnes -- liquid milk equivalent (LME) from the 61,080 tonnes-LME exported in the same period last year.

Dairy imports in the first quarter declined to 452,800 tonnes-LME from 487,520 tonnes-LME in the first quarter of 2012.

"According to FAO (Food and Agriculture Organization of the United Nations), international prices of dairy products have risen in the face of limited export supplies. Milk production continues to increase steadily in 2013 in many countries, especially in Asia, but growth in the main exporting countries is anticipated to be limited," the NDA said in a statement.

Despite the drop in volume, the total value of first-quarter exports fell by only 6.64% to US$33.79 million from the US$36.19 million recorded last year.

First-quarter imports were valued at US$184 million, a 10.01% decrease from last year's US$204 million. The NDA attributed the drop in exports to world market prices and suggested that exporters alter their product mix.

"Since international prices are expected to remain at elevated levels until at least the latter part of 2013... maybe exporters have to exercise balance between maintaining core markets and pursuing long-term market development and adjusting their product mix to ensure maximum returns," the statement read, adding that processors may use lower-value ingredients.

"Export volume is expected to continue its decline since we have low produce," Rene de Guzman, NDA planning department manager, noted in a telephone interview.

First-quarter dairy production increased by 2.82%, with milk production in the first quarter pegged at a total 4,740 tonnes-LME, compared with the 4,610 tonnes-LME of 2012.