February 20, 2004
Philippines May Attain Self-Sufficiency in Corn
During the 7th Cluster Meeting for Southern Philippines held February 16-19, Artemio Salazar, program director of the Ginintuang Masaganang Ani Program for Corn, said Philippines may be able to attain self-sufficiency in corn production if actual output is in accordance with the forecast all-time high of six million metric tons (MT) corn crop production in 2004.
He said the Philippines Department of Agriculture (DA) estimates a 5.6 million MT of corn production for this year. But with government's intervention such as high inputs, increase in hectarage planted to corn, and technology improvement through research and development (R&D), its production could increase by more than one percent compared to previous year.
Corn is the second most important crop in the Philippines. About 12 million Filipinos prefer white corn as their main staple. Yellow corn accounts for about 70 percent of livestock mixed feeds. It is also processed into high value products such as corn starch, corn oil, gluten ad snack foods. Around 54 percent of total corn production comes from yellow corn, which comprises one third of the total corn area.
On the other hand, the corn livestock sector accounts for 16 percent of the gross value added in agriculture. Some 600,000 farm households depend on corn as a major source of livelihood, in addition to transport services, traders, processors and agricultural input suppliers who directly benefit from corn production, processing, marketing and distribution.
Under the General Agreement on Tariffs and Trade -World Trade Organization the country is required to provide a minimum access volume for imported corn of 130,000 MT starting 1995 and increasing to 217,000 MT in 2004 at 35 percent tariff.
Quantities imported over these levels carry higher tariffs of 100 percent in 1995 and declining to 50 percent this year.
Private sector importation of corn substitutes in mixed feeds such as feed wheat and barley, are allowed and carry lower tariff rates. Likewise, in-quota imports of swine and poultry under GATT-WTO enter the country at 30 percent and 40 percent tariff, respectively. Out-quota tariff rates for the two commodities are slightly higher at 40 percent and 65 percent for 1998, declining to 35 percent and 50 percent by 2000.
Given the challenges of globalization, the GMA Program for Corn seeks to evolve a new development paradigm for the corn sector -- farmer-focused and agribusiness-oriented.
Salazar said the program aims to evolve groups of corn farmers into agribusiness entrepreneurs. The process starts with changes in production through farm clustering to gain economics of scale; pursuit of productivity enhancing measures, i.e. variety, credit delivery systems, and appropriate technologies in fertilizer and soil management, plant pest and disease management, post-harvest, among others; production intensification through irrigation; the diversification of production areas through corn based-high value crops farming systems; and production mechanization.
Contract growing and other market-matching schemes, together with provisions of post harvest infrastructure, farm-to-market roads, and timely market information, will ensure better prices and incomes for farmers. Human resource and institutional development activities will be undertaken to strengthen farmer organization and entrepreneurship.
A salient feature of the program is product transformation. Salazar explained the process involves a shift from the low value corn grain commodity to high value and price stable corn-based products.
Product transformation will be undertaken through the development of new products and uses of corn and the introduction of value-added processing schemes that enable the production of mixed feeds, snack foods and meat and poultry products within the farm cluster areas.
If the increase in corn production can be sustained, Salazar said there is a P10 billion profit for farmers especially in the countryside for this year alone.
