March 20, 2010

El Niño damage on Philippine agriculture surpass estimates

The Philippine agriculture damage caused by the El Niño dry spell has risen to PHP8.4 billion (US$184 million), exceeding estimates under a moderate scenario but tapering off from last month's crop loss surge.

According to Acting Agriculture Secretary Bernie G. Fondevilla, rice and corn farms were hit the most, particularly those in Region 2.

The increase is up from the PHP8 billion (US$175 million) worth of verified damage as of March 2. That tally meant the government's "moderate" El Niño scenario would have to be scrapped as the weather pattern is expected to last until June. The worst case damage estimate is PHP20 billion.

Fondevilla said it was possible the toll could hit PHP11 billion but stressed it would not be much higher than that since the country is already in the harvest season.

Leonardo A. Gonzales, president of the STRIVE/SIKAP Foundation, said the damage could go up to PHP20 billion, adding that the next planting season will be delayed due to lack of water.

University of the Philippines economist Arsenio Balisacan said the agriculture sector could contract by 3-5% in the first quarter, noting that the PHP8.4 billion worth of damage was already "serious."

Meanwhile, Fondevilla admitted that the latest damage tally could mean a first quarter contraction.