December 17, 2004

 

 

Philippines May See Low Corn Supply in Early 2005

 

Corn supply for the Philippines in the first quarter of 2005 could decrease because of damages caused by the typhoons in Luzon and drought in the South.

 

According to PhilMaize chairman Rod Bioco, the inventory from previous bountiful harvests and the still low demand from the hog sector reeling from cutback in breeding cows could, however, compensate for the expected lower corn volume next year.

 

"The ultimate determinant is how farmers would react to the price and weather advisory in the remaining planting months," he said.

 

He explained that what happened to Isabela and Bukidnon are an indication of the vulnerability of the country's crop production system.

 

Isabela, a major corn producer in Luzon, reported complete damage due to Typhoon Yoyong of more than 50,000 hectares, roughly 60 percent of the total corn area already planted.

 

In Mindanao, on the other hand, Bukidnon reported almost 20,000 hectares of corn in flowering stage completely damaged by drought.

 

"It is expected that the price of corn will increase in the immediate coming days and weeks as corn users will attempt to get hold of the local corn available which is still cheaper and of better quality than the imported corn or wheat feed which now costs about P11 per kilogram [kg]," Bioco said.

 

In Bulacan, the price of corn has increased from P8.20/kg before "Yoyong" to P8.70/kg a week after. In Cagayan de Oro City, it was P8/kg to P8.45/kg and in General Santos City, it was P7.60/kg to P8/kg.

 

The average 50 centavo improvement at the farm level should reportedly be an encouraging development to the corn farmers who are now grappling with much increased cost of fertilizers.

 

"The pick up in price at this time will be very critical because this will determine whether the farmers in key corn-producing provinces in Luzon and Mindanao will plant more. [Owing] to scarcity of subsidy from the government, farmers and financiers basically depend on price whether to invest more or not. If farmers, especially in Cagayan Valley, as well as Ilocos Region, will respond positively to the better price and plant more this December and January, we expect good corn supply by March and April," Bioco pointed out.

 

"Another important factor, however, particularly in rain-fed corn areas is the so-called mild El Nino. The issue here is the degree of rainfall reduction. If the farmers will be warned that rain will completely stop in the first quarter, then that imperils the December and January planting. We hope, however, that mild means the rainfall could be good enough for an upland crop like corn although it could not fill up an irrigation dam for rice. The first-quarter harvest is very important because it tides us over the usually lean second quarter until we reach the usually bountiful third-quarter harvest," added Bioco.

 

He said the government should prioritize the establishment of the necessary postharvest infrastructures so that the country's corn supply is stabilized.