January 28, 2021
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FULL-YEAR agriculture output contracted for the first time since 2016, after the sector was battered by the coronavirus disease 2019 (COVID-19) pandemic, a series of devastating typhoons, and the continued outbreak of African Swine Fever (ASF).
The Philippine Statistics Authority (PSA) reported on Wednesday that agriculture output, which contributes about a tenth to gross domestic product (GDP) and a fourth of the country’s jobs, shrank by 1.2% in 2020, a reversal from the 0.3% growth in 2019.
This was the first time the agricultural output saw an annual decline since 2016’s -1.5%.
In the fourth quarter, farm output slumped by 3.8%, worse than the -0.1% recorded in the same quarter of 2019 and the 0.7% growth in the third quarter.
This dismal performance makes it unlikely that fourth-quarter GDP, set to be announced today, will get a lift from the agriculture sector.
The PSA noted a drop in crops, livestock, poultry and fisheries production during the October to December period, when a series of strong typhoons hit parts of Luzon.
“We believe that despite the Taal Volcano eruption, COVID-19 pandemic, continued incidence of the ASF, and a series of strong typhoons, the country’s agriculture and fishery sector has remained pliant and resilient, facing head on and surmounting the huge challenges last year,” Agriculture Secretary William D. Dar said in a statement on Wednesday.
After missing the 1.5% growth target last year, the Department of Agriculture (DA) is aiming to achieve 2.5% growth this year.
In the fourth quarter, crops output declined by 0.4% versus the 1% growth it posted a year ago, as palay (unhusked rice) and corn production dropped 1.4% and 0.3%, respectively. Improvements were seen in production of tobacco (13.4%), sugarcane (10%) and cacao (7.1%) during the period.
For the full year, crops production improved by 1.5%, led by increases in sugarcane (19%) and cacao (10%).
Mr. Dar said production of rice and corn are seen to increase in 2021, as long as there are no strong typhoons. The government has allocated around P20 billion in programs to improve output in the two subsectors.
In a mobile phone message, Roy S. Kempis, a professor at Pampanga State Agricultural University (PSAU) said it should be noted that crops output only slipped by 0.4% for the fourth quarter despite the typhoons.
“This means that crops such as rice, corn, fruits, and vegetables have been harvested before the typhoons arrived,” Mr. Kempis said.
Typhoons Quinta, Rolly, Ulysses and Vicky, swept through the country in the last three months of 2020. Data from the DA showed the combined crop damage caused by Quinta and Rolly reached P8.46 billion, while losses from Ulysses amounted to P6.72 billion, and damage from Vicky totaled P129.8 million.
Rolando T. Dy, executive director of Center for Food and Agri-Business of the University of Asia and the Pacific (UA&P) said in a mobile phone message that the sector can improve in 2021 by focusing on hybrid rice and by consolidating mechanization to increase yield.
IMPACT OF ASF
Livestock production, which accounted for 15.4% of total agricultural output, slipped by 12.9% in the fourth quarter. Hog production decreased by 13.8% during the period, as the ASF outbreak persisted.
Poultry production slumped by 5.5% in the October to December period, bringing the full-year decline to 3.5%. Chicken production declined by 7.9% in the fourth quarter.
“Expectedly, the livestock and poultry subsectors performed poorly due to the ASF incidence in Central Luzon and low demand of chicken due to limited operation of fastfood chains and restaurants,” Mr. Dar said.
He said the DA has set aside an initial budget of P500 million for loans to backyard and semi-commercial raisers in an effort to improve local poultry production.
PSAU’s Mr. Kempis said the decline in poultry output was a surprise since he expected it to grow as Filipino consumers look for a substitute to pork.
“I believe factors that may have affected is the closure of poultry farms as a result of the crackdown by local government units on farms that adversely affect the environment with flies and obnoxious odor, and conflict between contract growers and integrators,” Mr. Kempis said.
United Broilers Raisers Association (UBRA) Chairman Gregorio A. San Diego said the poultry industry’s losses were more than what PSA data showed, adding this was the reason for the rise in the retail price of chicken.
Based on latest price monitoring from the DA, the price of whole chicken ranges at P160 to P200 per kilogram.
Similarly, DA reports showed that the price of pork shoulder, or kasim, ranges from P340 to P400 per kilogram, while pork belly, or liempo, is priced from P320 to P440 per kilogram, well above their suggested retail prices (SRP).
As a result, the DA recently proposed an executive order to put a price ceiling on the said products. If signed, the price of pork shoulder will be at P270, pork belly at P300, and whole chicken at P160.
Fisheries production fell 4.7% during the fourth quarter of 2020, a turnaround from the 2% growth it posted in 2019. This brought the value of production of the fisheries subsector to drop by 1.2% versus a growth of 1.5% the previous year.
The PSA said fish species such as fimbriated sardines, blue crab, threadfin bream, tiger prawn, tilapia, and yellowfin tuna posted lower output.
Asis G. Perez, Tugon Kabuhayan convenor and former national director of the Bureau of Fisheries and Aquatic Resources (BFAR), said the lower fisheries output can be attributed to recent typhoons.
“Major production areas for aquaculture and capture fisheries such as the Calabarzon Region and Bicol Region were devastated,” Mr. Perez said in a mobile phone interview.
However, Mr. Perez said the subsector is seen to quickly bounce back in 2021 since the fishing boats that were damaged during the recent typhoons have already been replaced or repaired, thus allowing fishermen to return to fishing.
“Further, the closed fishing season for roundscad (galunggong) will end on Jan. 31. It will augment the country’s fish supply,” Mr. Perez said.