August 10, 2021


Philippines' agricultural output fell 1.5% in Q2 2021



The Philippines' agricultural output had dropped by an annual 1.5% in the second quarter of 2021 due to a slump in livestock and fisheries production, said the Philippine Statistics Authority (PSA) on August 9.


In a report, the statistics agency said the value of agricultural production at constant 2018 prices declined by 1.5% during the April to June period, a reversal of the 0.5% growth during the same period in 2020.


"Decreases in the production levels were noted for livestock and fisheries. Meanwhile, productions of crops and poultry posted increased during the period," PSA said.


However, the second-quarter agricultural output drop is a slight improvement from the 3.4% decline seen in the first quarter.


Philippines Agriculture Secretary William D. Dar said that the figures show a "resilient agriculture" sector despite the ongoing pandemic and the African swine fever (ASF) outbreak.


At current prices, the value of agricultural production stood at ₱503.3 billion (US$9.99 billion) in the second quarter, up 7.2% year on year.


For the first half, the value of agricultural production contracted by 2.5%, lower than the 0.6% drop a year ago.


Livestock production, which accounted for 14.2% of total farm output, slid by 19.3% in the April to June period. For the six-month period, livestock output declined by 21.4%, lower than the 4.5% contraction seen during the same period a year ago.


The ASF outbreak continued to affect the industry, with hog production falling 26.2% in the second quarter. In contrast, double-digit growth was seen for cattle (32.6%), carabao (26.2%) and goat (23.4%) production.


Rolando E. Tambago, president of the Pork Producers Federation of the Philippines, Inc., said that hog production is expected to further drop until early 2022.  


"Many hog raisers are still scared due to the risk of ASF and with low consumer demand brought by the COVID-19 pandemic," added Tambago. "Further, with the major consuming population affected by lockdowns, and with the entry of cheap pork imports, local pork producers just cannot compete in terms of production."


PSA reported double-digit declines in yellowfin tuna (-34.9%), roundscad (-18.3%), threadfin bream (-17.1%), frigate tuna (-16.9%), fimbriated sardines (-13.7%), skipjack (-12%) and Bali sardinella (-10%).


Other fish species saw higher output such as blue crab (24.2%), tilapia (14.3%), mudcrab (13.4%), milkfish (12.5%), grouper (8.7%), slipmouth (5.1%), squid (4%) and bigeye tuna (3%).  


Crops and poultry production were bright spots for the agriculture sector in the second quarter.


Accounting for more than half of total agricultural output, crop production rose by 3.1% in the April to June period and by 3.2% in the first half.


Production of corn went up 6.3%, respectively.


Roy S. Kempis, a Pampanga State Agricultural University professor, said higher crop output can be attributed to the generally good weather in the second quarter.


"With good prices because of good quality harvest plus more quantity harvested, overall value of rice and corn rises," he said.


Poultry production, which shared 13.5% of overall farm output, jumped 2.5% for the quarter. However, in the first half, poultry output fell by 2.6%.


PSA data showed production increased for duck (38.4%), chicken eggs (13.1%) and duck eggs (1.8%) while chicken production went down by 1.6%.   


Rolando T. Dy, executive director of the Center for Food and Agri-Business of the University of Asia and the Pacific (UA&P), said that poultry production improved after a shift in demand when pork prices spiked due to the supply shortage earlier this year.


"The demand has shifted in terms of poultry production. I think hog production will face challenges until the end of the year," Dy said.  


The Department of Agriculture (DA) recently downgraded its full-year growth target for the agriculture sector to 2%, lower than its previous goal of 2.5%.  


Foundation for Economic Freedom (FEF) president Calixto V. Chikiamco said the 2% growth target will now be harder to reach as a result of the second-quarter figures.  


"It was also negative in the first quarter. Then you have another lockdown disrupting demand and production in the third quarter. I think full-year agricultural growth will now be at 1% growth or even less," said Chikiamco.


Federation of Free Farmers (FFF) national manager Raul Q. Montemayor said the agriculture sector has to show significant growth in the second semester to achieve the DA's target.


"We need to achieve a 6.3% increase in gross value-added (GVA) for agriculture in the second half to end 2021 with a net 2% growth in constant 2018 prices. Between 2016 and 2020, the highest second semester growth rate was only 2.78% registered in 2017. This means that the 6.3% is historically difficult to achieve," said Montemayor.


- BusinessWorld