August 16, 2004

 

 

Philippine Corn Production May Decline In 4th Quarter
 

Corn production in Philippines is threatened to drop by five percent in the fourth quarter compared with 1.125 million metric tons (MT) in the same period last year, if the government does not ensure post harvest facilities that will keep corn quality acceptable to the market at a premium price.

 

Artemio M. Salazar, Department of Agriculture (DA) corn program director, told a press briefing that while corn is expected to reach a record-high 5.3 million MT by the end of the year, up by 14.7 percent from the previous year's 4.62 million MT, fourth quarter growth may be dampened by any post harvest loss that may be incurred by farmers.

 

"Based on planting intention, we may have a negative five percent in the fourth quarter if we're not able to maintain a good price for farmers that will encourage farmers to plant more. It's not an issue of low demand because there is a big demand. Rather, the problem lies with the quality of corn that will make users pay for a higher price," he said.

 

Salazar said that provision of post harvest facilities is pivotal to maintaining corn's good quality since the big harvest expected in the third quarter, estimated to grow by 30 percent to around 1.9 million MT, will require many post harvest facilities-storage and dryers. A big harvest is expected to come from Isabela and Cagayan in August-September.

 

But if post harvest facilities are not adequate, the farmers' loss will definitely dampen their intention to invest in seeds and fertilizers in the fourth quarter.

 

"Crucially, there is the farmer's decision to plant, which is just a function of his planting interest. If he earns, he plants more. If he loses, he plants less. Instead of buying five bags of fertilizer, he will just buy two bags," he said.

 

Salazar said that at the prevailing corn price of P7.50 to P8 per kilo at farm-gate, farmers are still earning at an acceptable rate. However, he said that the DA is urging Mindanao corn farmers to arrange for warehousing-drying with the National Food Authority (NFA) and private warehouses for the coming harvest, or farmers will be adversely hurt by collapsing prices.

 

Aside from post harvest facilities, Salazar said government also has to find the means to encourage farmers to invest in fertilizer to keep production high.

 

Apart from the high price of corn in the world market, Salazar said the increase in local corn production the past two years has been brought about by several government interventions including DA's direct marketing of corn production to end-users including feed millers San Miguel Food Inc., Tyson Agro-Ventures, and General Milling Corp.

 

"This eliminated the cost for traders," he said.

 

Furthermore, extension work teaching farmers to plant the high-yielding hybrid corn has also been pushing up production.