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Opinion

Encompassing

FIRST PERSON - Alex Magno - The Philippine Star

There is no debate about this: our agriculture is a mess.

For many years, the stagnation of agricultural production has been a heavy drag on the ability of the economy to grow faster. Stagnation produced rural poverty in turn and forced millions to seek better fortunes in the cities. This translated into urban poverty.

Our farmers are aging. The average age of our rice farmers, for instance, is about 57. This is because the next generation preferred to do things other than farm.

Our farms are inefficient. The average farm plot is one hectare. That defies the economies of scale and is resistant to mechanization.

The only alternative strategy is to reconsolidate land and build agro-industry. But the prevailing social justice orthodoxy on the matter will resist that even as we can no longer feed the nation with subsistence-level farms.

Our agricultural logistics system is primeval. When farmers harvest a bumper crop or fishermen chance upon an unusually good catch, much of the produce goes to waste. We need to invest trillions in domestic shipping, rail transport, silos in ports, cold storages and reefers to improve the system.

Currently, about a third of our grain and vegetable produce is lost to spillage and spoilage. That adds to the costs and the shortages.

Agriculture is a poverty trap. Those who toil in subsistence farms are condemned to be poor. They bear the brunt of the inefficiencies deeply ingrained in the system.

Those in the cities, dependent on rural produce, are at the mercy of inefficient delivery systems as well. They pay high prices and eat bad food. Most consume instant noodles poured over poor rice – a diet that guarantees malnutrition.

The Department of Agriculture, limited by the scope of its bureaucratic mandate, has become little more than a mechanism for dispensing subsidies. Low-grade corruption explains the substandard fertilizers and inappropriate farm tools distributed to farmers.

All the money being burned for placebo solutions solve nothing. The money will be better used to capitalize farm production and create forward linkages to food processing.

It is not enough to break up the entrenched syndicates plaguing modernization of our agriculture. The systemic inefficiencies present us with an encompassing problem that requires revolutionary strategies.

In this context, it is probably most welcome that incoming president Bongbong Marcos decided to handle the agriculture portfolio himself. This will enable thinking out of the bureaucratic box and exploring comprehensive solutions to a systemic problem.

But, like everybody else, Marcos has only 24 hours in a day and 7 days in a week. There are a thousand other duties the president needs to perform. There are a thousand concerns each day that will require presidential judgment.

Being simultaneously president of the Republic and secretary of agriculture might be an impossible mission unless he builds an exceptional team that will enable him to be proficient in both roles.

Urgent

Food is literally a gut issue.

With fuel prices driving inflation higher, food becomes more inaccessible by the day. Not only are we producing less rice than we need, we also import wheat and other grains. The global grains market is volatile at the moment because of the loss of Ukrainian exports.

Wheat supply is particularly critical. International organizations are calling attention to the possibility of famine in the Middle East and Africa arising from the war in Ukraine.

Everyone is expecting a spike in flour prices. This will be dire for our consumers. We import the entirety of our flour needs.

Only a small margin of rice production is available for trade. Several rice exporting countries, anticipating tight supply in the coming months, have begun tightening on exports. This could have adverse effects on our own supply. The possibility of rationing the staple is not off the table.

Rescuing our agriculture from stagnation will be a long-term and arduous process. Ensuring our food security in the coming months is an urgent task.

Spiking fuel costs highlight the inefficiency of our logistics system for agricultural produce. We are dependent on a most inefficient system for delivering food from the farms to the final consumer. As a result the spike in fuel prices reflect immediately in the cost of food.

We might be lulled into complacency by assurances we have enough food stocks to feed our population. But if the prices of these food stocks are inaccessible, the effect on hunger is just the same.

The most immediate challenge is to keep food prices accessible to the majority of our people. A lot of innovative thinking will be required to figure out ways to shield our consumers from the price impact of a perfect storm of war, supply chain disruption and unabated increases in fuel costs. This might even be an impossible mission.

It took a lot of courage for Bongbong Marcos to decide to handle the agriculture portfolio himself. Should a supply and price crunch happen in the next few months, he will be held directly responsible for a situation that was many decades in the making.

He will have to produce palpable results in a very short time. These results will be against the current of larger trends we have no control over. We can neither bring down fuel prices nor produce flour out of thin air.

The peril here is a great temptation to indulge in cosmetic programs – such as rolling stores – dependent on unsustainable subsidies. The focus should be on curing the systemic weaknesses endangering food access.

AGRICULTURE

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