Farm output shrinks in Duterte admin's final quarter

MANILA, Philippines — In the final quarter of the Duterte administration, Filipino agricultural workers struggled as farm output shrank anew, leaving more questions than answers on how the national government could support their sector.

The Philippine Statistics Authority released data on Monday that revealed the value of agriculture and fisheries production shrank 0.6% year-on-year in the second quarter at constant 2018 prices. This was a better showing compared to the outturn a year ago when it contracted 1.5%. 

On a quarterly basis, the latest reading fared poorly as farm output declined 0.3% in the first quarter of 2022. 

Historically, agriculture has contributed about a tenth of GDP and employed about a quarter of Filipino workers, but advancement in other economic sectors had left behind the farm industry that the Duterte administration struggled to revive.

The country’s agriculture industry is in a fragile state of recovery these days since it needs to balance the country’s food needs while bearing the weight of expensive fuel prices that pushed production and input costs up. Even then, the sector is still finding lost footing after typhoon ‘Odette’ ravaged crucial agricultural land at the end of 2021. 

Data broken down showed that crop production, which accounts for 54.9% of total output, skidded 2.8% year-on-year in the second quarter. Amid a reported sugar shortage, the PSA reported sugarcane production led the list of ‘losers’ as output plummeted 53.8% compared with a year ago. Palay and corn output, which was hampered by Odette in the first quarter, reported marginal gains. 

Commenting on the data, Domini Velasquez, chief economist of China Banking Corp, noted several factors that weighed heavily on production. 

“I think a little bit of Odette for sugar. However, for other products such as livestock, there is some recovery/repopulation of the hog industry from the effects of the African swine fever since 2019,” she said in a Viber message. 

Livestock production, which accounts for 14.6% of output, inched up 2.1% in the second quarter of the year, supported by a 22.2% growth in dairy output as well as improved hauls from hog and cattle farms. Goat and carabao production shrank in the same period. 

Poultry production expanded 7.8% year-on-year in the second quarter, a slower figure compared to the 12.3% observed at the start of the year. 

“Poultry also likely benefited from the ability to control the avian flu in certain municipalities and cities. However, there was also a fishing ban in the west Philippine sea in Q2 which probably affected the performance of the fisheries sector,” Velasquez added.

The fisheries subsector shrank 2.3% year-on-year in the same period, hampered by double-digit declines in sugpo (tiger prawn) (30.8%), alimasag (blue crab) (28.5%), tulingan (frigate tuna) (21.8%), alimango (mudcrab) (20.9%), talakitok (cavalla) (16.6%), and bangus (milkfish) (15.5%). 

“Moving forward, key risks are higher fertilizer and feeds costs (e.g. corn), which can affect the amount of investment of farmers and agricultural workers…Moreover, for poultry and livestock, pricier feeds may lead to scrimping on feeds or shifting to lower quality feeds and medicines and may affect the quality of the produce,” Velasquez said.