Wheat imports seen to drop as ASF lingers

MANILA, Philippines — The Philippines is expected to decrease its importation of wheat next year due to the coronavirus disease pandemic and the continued outbreaks of the African swine fever (ASF).

In the latest report of the United States Department of Agriculture-Foreign Agricultural Service (USDA-FAS), next year’s importation at 6.8 million metric tons is 3.6 percent lower than the expected 7.06 million MT this year.

The USDA revised wheat import projection from the seven million MT in September.

“This is due to weaker demand for feed wheat and new policies limiting issuance of sanitary and phytosanitary import clearances,” USDA said.

The ASF has resulted in reduced hog demand for feed wheat which offset the growth in the milling wheat.

The deadly hog disease remains an issue in the Philippines with 406,899 pigs already killed since the outbreak started in August 2019. ASF is now present in 11 regions, 34 provinces, 392 municipalities and 2,061 barangays in the country.

The ASF has affected feed wheat more than corn as the former is utilized primarily in hog feeds, while poultry raisers prefer using corn.

“More significant is that hog raisers have downsized their operations due to the continued threat of ASF, indicating pork production is on track for further losses in 2021,” USDA said.

Another factor limiting feed wheat trade are restrictions on the issuance of SPSIC following the recent order from the Department of Agriculture on the additional guidelines covering corn and wheat.

In contrast to feed wheat, milling wheat has increased as the bakery and noodle sectors have been doing well during the pandemic.

Other wheat-based products such as cakes and cookies, however, have fared poorly due to restrictions on gatherings dampening demand.

There is no commercial wheat production in the Philippines and wheat is the main raw material for flour and feeds.

US wheat consistently dominates the Philippine milling market as consumption of wheat-based products such as flour, bread, pasta, and noodles continue to grow.

The Philippines has risen to become the largest customer for US wheat exports as consumption has grown four to seven percent annually over the last decade.