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Business

Hunger games

DEMAND AND SUPPLY - Boo Chanco - The Philippine Star

This is a gut issue, literally, and our leaders are playing hunger games with it. This problem is threatening to escalate. Climate change, international politics, and our domestic failure in agriculture are not making things easier.

The national Social Weather Survey of April 19 to 27 found that 12.2 percent of Filipino families or an estimated 3.1 million experienced involuntary hunger – being hungry and not having anything to eat – at least once in the past three months.

Late last week, the latest economic growth or GDP growth rate report from the Philippine Statistics Authority showed that the agriculture sector contributed minimally to GDP.

Agriculture, forestry, and fishing (AFF) increased by 0.2 percent in the second quarter of this year. Sugarcane, including muscovado sugar-making, significantly declined to -50.1 percent.

President Junior should by now realize the gravity of it all. When asked by CNN Philippines if there is already a food crisis in the Philippines, NEDA Secretary Arsi Balisacan said yes.

Sec. Arsi then cited the soaring prices of rice and meat products, as well as the “low profitability” of farming.

“Food crisis has risen already, and as you know, the avian flu – this problem has been with us that has led to gripping price increases of meat. Rice prices have also been a problem. While the tariffication has brought down the cap of prices quite a bit, they are still high.

“There are issues that concern farmers, the low profitability of rice farming in agriculture and farming in general have to be faced, so with that I would say that our agriculture is in crisis,” he said in an interview with CNN Philippines.

Subsequently, a meme was published on Facebook by the Department of Agriculture featuring Balisacan saying: “To boost local food production, the government will continue to support the agriculture sector through lower input costs development of new farming technologies, extension of financial assistance to farmers, and strengthening the agricultural value chain. These can be achieved through the Plant, Plant, Plant Program 2, the government’s P24-billion flagship program on food security, which provides subsidies and support to the agriculture sector.”

Good intentions, but it sounds like we have heard those before. Can the DA implement? The past regime also planned to do those things and where are we now?

The reality of hunger was a subject of discussion in one of my Viber groups where a former agriculture official gave us a candid assessment of our situation.

“It will be worse by the end of this year as farmers were not able to apply the right amount of fertilizer because of soaring fertilizer prices. Also, government was unable to provide adequate fertilizer subsidies in time for this wet planting season from late May until harvest starting the second week of September.

“Urea is needed for the grain to fully develop within the palay husk. We will be short by 600,000 to 700,000 metric tons this year, discounting damages caused by typhoons. On the positive side, the private sector had already imported 1.8 million metric tons (MMT) as of the end of June. That is why rice prices are relatively stable.”

Are we living off our past harvest? The former DA official corrected that impression:

“Technically we are not living off our past harvest. Local production can only meet 86 to 92 percent of our rice requirements, depending on how destructive typhoons visiting the country have been. That is the reason why we have an annual rice deficit of one MMT to 1.8 MMT, which we import mainly from Vietnam (almost 90 percent).

“We over imported last year, around three million MT and this explains why rice prices are stable. Same was true in 2020. No funds from government were used because it was the private sector that imported. This is one of the benefits of the Rice Tariffication Law.”

But importing from Vietnam may pose some problems now.

Vietnam is struggling with an extreme dry season in the Mekong delta. Other than La Nina, China has been putting up dams in upstream Mekong from China to Cambodia and reducing the water that goes to Vietnam.

The news isn’t too encouraging from India, the largest rice producer. Bloomberg reports that a shortage of rain in parts of India has caused planting areas to shrink to the smallest in about three years.

India accounts for 40 percent of global rice trade. India’s government has already curtailed wheat and sugar exports to safeguard food security and control local prices. The jump in India’s rice prices reflect concern about output, Bloomberg reports, and curtailing rice exports could be next.

We also have problems with other crops. The retail price of white onions has hit P400 a kilo. It is also no longer available in different wet markets in Metro Manila.

On the other hand, the retail price of red onions ranges from P110 to P150 per kilo in various NCR markets. The DA is looking at importing both red and white onions to address the supply shortage.

As for sugar, a decision was made in March to import at least 200,000 tons of refined sugar, but a TRO was issued by Negros courts. Now, Junior’s officials want to import around 300,000 MT, but Junior is against it. I am told we will run out of raw sugar this month and refined sugar by October/November.

Also listed for importation to stabilize retail market prices are pork, corn, poultry (after more than a million chickens were culled in Pampanga due to the spread of bird flu).

Can we cut down on rice consumption? It is a function of income one expert explained.

When income rises, consumption shifts from starchy to protein rich food. Rice is still the cheapest energy source, as protein rich food like beef, pork, poultry, and fish are almost beyond the reach of poor Filipino consumers.

“We pay double the price of pork and around 73 percent more for chicken compared to Thai and Vietnamese consumers. Our rice price is at least 50 percent more expensive than Vietnam. Sugar price is more than double the international price.”

If food prices continue their upward trend, hunger will be a reality for many of our people. And our politicians are playing hunger games with agriculture policies dictated by vested interests.

 

 

Boo Chanco’s email address is [email protected]. Follow him on Twitter @boochanco

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