August 6, 2008
Philippine corn buying price may not be enough to ward off shortage
Philippine farmers have warned that the new government-set buying price for yellow corn may not be enough to prevent shortages due to expensive fertilizer costs which discourage farmers from planting.
Farmers have recently asked for a 73-percent hike in corn prices to prevent the dwindling of local corn supply and also reign in domestic inflation, said Roger V. Navarro, president of the Philippine Maize Federation, Inc. (Philmaize).
In answer to the plea, the government did raise the corn buying price, but the increase for yellow corn was less than the 73-percent request.
The Inter-Agency Committee on Rice and Corn last Friday (August 1) approved the increase in the government's buying price for white corn to PHP13 per kilogramme and yellow corn to PHP10 per kilo, both up from PHP7 per kilo, agriculture secretary Arthur C. Yap said. Yellow corn price only increased by 43 percent.
Navarro said that the association was pleased on the new white corn selling price at PHP13 per kg. However, he added that a bigger increase in the price of yellow corn should also be considered, since it is a primary demand of the livestock industry.
"We firmly believe the only incentive we can give the farmers to plant again is to give them the price they can earn today," Navarro said.
Agriculture assistant secretary Dennis R. Araullo warned that "if corn farmers do not plant next season, corn prices may surge to PHP16-20 per kilogramme."
The Philippines, which accounts for just 1 percent of world corn output, produced 3.29 million tonnes of the crop in the first half, slightly higher than its goal of 3.22 million tonnes.
The government has set a corn production target of about 7.4 million tonnes this year, up 9.5 percent from 2007.