Have you bought chicken from the supermarket or fast-food chain lately?
It’s not COVID-induced brain fog, and it’s not just your imagination: the whole chicken and parts are smaller than usual.
The reason for it, as explained by Bong Inciong, president of the United Broiler Raisers Association, gives you an idea of the complexity of the problems plaguing our agriculture sector.
What happened to the chickens?
Inciong’s short answer is that they are likely getting less nutritious food. Just like poor nutrition is causing physical and mental stunting among Filipino children, less nutritious imported corn feed is producing scrawnier poultry.
When it comes to corn feed, Inciong says Philippine yellow corn is nutritionally superior – providing high energy, faster growth – and is cheaper and more stable than imports.
There is currently no chicken shortage like in 2003, Inciong emphasized, when poultry products were truly in short supply in supermarkets, wet markets, fast-food chains and other institutional outlets.
He says that local corn production, however, has been down for the past two years. For this poultry-related problem, we have a swine problem to blame.
In 2020, before COVID-19 upended our lives, the country had a rich corn harvest. But then, African swine fever (ASF) hit the local hog industry.
“Corn farmers, for the last two years, they have no confidence in producing because the ASF had a huge impact on their market,” Inciong told us last Thursday on One News’ “The Chiefs.”
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To ensure stable supply and prices, the Department of Agriculture (DA) announced that it would allow the importation of substantial volumes of pork and pork products.
“If you are a corn farmer, when your fertilizer cost is at record high also and your Department of Agriculture would announce special importations without giving some assurance that you will not end up in a disaster at harvest time, then that farmer will find another crop,” Inciong said.
Prices of both yellow corn and soya feed are currently at a five-year high, he said.
Broiler production is also truly down. Inciong’s explanation for this: businessmen adjust production based on “rational expectations” of demand. And demand for chicken usually slows down after elections. There is also the lower demand due to the economic impact of the pandemic.
“We adjusted production to adjust to the expected demand. And unfortunately, performance of the flocks was affected by the quality of the feeds, because we’re having difficulty getting quality raw materials for feeds, for corn and especially soya,” Inciong told us.
“The nature of agri commodities, of feeds raw materials is such that the more expensive it is, in all likelihood the poorer the quality,” he pointed out. “When supply is short, even the poor quality soya or corn and other raw materials will have some buyers just to be able to push through with your production.”
Poor quality feeds slow down the normal 30 to 35-day broiler production cycle, he said, which also affects chicken supply.
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How much has the Russian invasion of Ukraine disrupted the broiler supply chain? Inciong cannot quote specific data. Ukraine is a source of feed wheat for local hog raisers and accounts for 10 to 20 percent of global soya feed production, but Inciong says the local broiler industry prefers soya from the United States and yellow corn from the Philippines.
Why are the broiler producers in the dark on critical information about the agriculture sector?
Inciong says Republic Act (RA) 8435, the Agriculture and Fisheries Modernization Act of 1997, provides for the creation of a national information network or database on agriculture that should include, among others, the number of farmers growing specific crops nationwide, prices of crops and farm inputs. Such a database will not only help agricultural producers in their planning but also help address unfair trade practices and smuggling.
Instead of a comprehensive database, what producers rely on, says Inciong, quoting an interviewer, is “tantiya meter” – guesstimates on which they base harvest, livestock and poultry production.
The avowed intent of RA 8435 is to make Philippine agriculture more competitive in the global market.
Broiler producers hope the incoming agriculture secretary, being the chief executive, will fully implement the law.
“There are a lot of things to correct there,” Inciong said. “There is no rule of law for us. It is the rule of economic doctrines by a few economists.”
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As an example, he pointed out that the World Trade Organization allows countries to maintain a quarantine system for agricultural imports for the safety of domestic animals and crops. The global standard, Inciong says, is to quarantine the imports first for inspection before the collection of tariff.
In the Philippines, he says the system is reversed: tariff collection first, then quarantine, and then inspection at the storage facility.
Affected sectors are also not consulted on policies affecting them; this goes against the law, Inciong laments.
He says it’s “a sign of the times” that whole dressed chicken and parts that are smaller than usual are being sold.
Back in the day, he said, such scrawny birds and parts were simply given away for free: “Noong araw, hindi na mabebenta yan… ipamimigay na lang.”
The broiler industry is monitoring the supply situation.
“We will know if it is just a glitch, a problem in production, in 30 to 60 days,” Inciong said, citing the normal broiler production cycle. “Hopefully it will not be like in 2003.”
An upside of the looming food crisis is that it is highlighting the problems besetting the agriculture sector, and the importance of the sector in national life and the economy. The crisis could lead to reforms that players in the sector say are long overdue.
The reforms are needed as Inciong warns, “For the next 5-10 years, we will have an interesting situation in terms of supply chains.”
Inciong noted that for a long time, remittances from overseas Filipino workers plus revenue from travel and tourism have propped up the Philippine economy even in the worst of times.
Now the problems besetting agriculture, described as “severe” by the incoming DA chief, may highlight the importance of the sector. Or at least this is the hope of agriculture stakeholders.
Because of years of neglect, the chickens are coming home to roost.