November 25, 2024

 

Is the Philippines bringing in enough corn?

The importance of corn in Philippine swine farming cannot be overstated.

 

A document by the Department of Agriculture (DA) in the Philippines' Cagayan Valley Region shows that yellow corn constitutes most of feed ingredients in a local pig's food — at an amount of 4.6kg of the daily feed allowance for five pigs weighing 60-65kg to a market weight range of 90-100kg.

 

With the Philippines' corn production hammered by El Nino and armyworm infestations in recent times, the country's corn import is set to rise this year — according to the US Department of Agriculture (USDA) — reaching a volume of 1.3 million metric tons. This amount was an increase from a previous estimate of 1.1 million metric tons.

 

Such an action tends to point towards an attempted alleviation of tight supply which can lead to rising corn prices if supply shortfalls are left unabated. Lower carrystock stocks mean that the domestic corn farming sector is not producing enough, and therefore, more corn from outside the Philippines has to be brought in. 

 

The devastating threat of armyworms adds to the woes of Philippine corn farmers. In Negros Oriental alone, armyworms struck some 6,812 hectares of corn plantation, an official told the Philippine News Agency in early August, although their spread has since been brought under control, the Department of Agriculture - Provincial Agriculture Technological Coordinating Office (DA-PATCO) said in early September.

 

Several industry sources saw a drop in planted areas and yields due to the persisting problem of the infestations. As such, USDA-FAS Manila forecasted corn production to be lower in marketing year (MY) 2024/25 compared to USDA Official; based on FAS Manila's data, Philippine corn supply is expected to be 2,100,000 metric tons (MT), a lower volume compared to 2,350,000 MT for MY 2023/24 and 2,350,000 MT for MY 2022/23. By percentage, the country's corn supply in MY 2024/25 is expected to drop by 10.64% compared to both MY 2023/24 and MY 2022/23.  

 

The prices also put the monthly average retail price of yellow corn at ₱66.87/kg (US$1.18) in September 2024 and ₱67.93/kg (US$1.19) in August 2024. Thus, September's average price is a drop of 1.56% from that of August.

 

It is possible that rising Philippine corn imports, which complement the country's domestic production, have been sufficient to keep corn prices from spiking to a dramatic high due to a tight supply.

 

While USDA-FAS data (as of July 9, 2024; New Post) shows that Philippine corn production is anticipated to be at its lowest in MY 2024/25 at 8,200,000 MT when compared to 8,400,000 MT in MY 2023/24 and 8,322,000 MT in MY 2022/23, the country's corn imports have been on a gradual rise during MY 2022/23 (907,000 MT) and MY 2023/24 (950,000 MT); this trend is expected to continue in MY 2024/25 (1,000,000 MT).

 

More so, imports would play a crucial role in maintaining the price control of corn as domestic production struggles to catch up.

 

As much as the narrative of feed inputs being the chief cost burden on livestock farming is true, the Philippine swine sector is coping with more than that: African swine fever (ASF) remains the overshadowing challenge against the industry. As local pig farming suffers losses from pig deaths, farm gate prices stay stubbornly low.

 

Nevertheless, where the price trend heads for Philippine corn prices can also have a substantial impact on the battered swine sector. 

 

- EFL AG-DATA