Declining Agri Yield Worrisome – Philfoodex

MANILA, Philippines - The yield and export of the world's famous Manila mango has been dwindling over the years in tandem with other Philippines agricultural products and lagging behind other ASEAN countries, a situation that has alarmed leaders in the industry.

Industry leaders attending the launch of the 11th Philippine Food Expo to be held next week said the declining agriculture productivity level in the country cannot be reconciled with the government's 2012 Gross Domestic Product growth target of 5.5 to 6.5 %. They urged government for immediate intervention to arrest the continued decline in the country's agricultural sector.

They said that food manufacturing /processing and exports sector are bogged down with serious concerns of inadequate raw material supply, high cost of sugar and other material inputs, high cost of power and poor infrastructure and logistics that all boils down to uncompetitive domestic agri sector.

Roberto C. Amores, president of Philippine Food Processors and Exporters Organization, Inc. (Philfoodex), stressed the continued paucity of supply of essential raw materials, which are vital inputs for the food manufacturing/processing industries, has stunted the export performance of the agri sector.

Amores cited the case of mangoes, the country's third most important crop next to bananas and pineapple, which production continues to decline. In 2009, output stood at only 771,000 tons from a high of over one million tons in 2007.

Production fluctuated from 2000 to 2009, posting an average decline of 0.7 percent per year. The downturn was attributed to several causes such as changing climatic conditions, incidence of pests and diseases, and immature trees.

From the perspective of over 2 million small mango growers, the main reasons for the yield decline from 2000 onwards of 4.5% per annum ending at only 4.1 tons/ha. in 2009 was caused by the high costs of inputs, the lack of investments in research and development for better quality disease resistant and higher yielding varieties as well as the scarcity of long-term finance which prevented new plantings.

It was noted that the Philippines yield of mango was among the lowest in the ASEAN. At only 4.55 tons per hectare in 2010, this was only about 40% of the yield of Cambodia and 35% that of Indonesia.

The Philippines performance in agro-food exports lags behind its ASEAN peers and far from global averages. The country's productivity of many agricultural crops registered yields below global average.

In the recent book written by Prof. Rolando Dy, Ph.D '' the Business of Agribusiness: from the Roots to the Fruits'', he cited that the gaps vary widely from product to product. There is an 80% gap with Vietnam for coffee yield: the Philippines is barely 300 kilos green beans a hectare versus some 2,000 kilos in Vietnam. There is a 20% differential for palay: it is four tons per hectare for irrigated areas compared to over five tons in Vietnam. The average oil yield of coconut (500 kilos per hectare) is barely 10% of the average mature yield of oil palm (4,500 per hectare).

''The market is not necessarily the compelling constraint in most of the products. It is supply constraints, which are first, farm productivity, second, land and water access and third, the logistics from farm to market. They affect the throughput within the agribusiness system singularly or in combination'' according to Dr. Dy.

Moreover, there is need to address the immediate problem of the increasing costs of sugar and the spiraling cost of power which are critical components affecting the costs of processed food products including drinks and beverages. The power cost in the Philippines is among the highest in Asia. These impacts on the cost of primary processing like drying, storage and of course processing.