GROWTH in the country’s agricultural output slowed to 1.47% in the first quarter due to a marked deceleration in the expansion of the crops subsector, the biggest contributor to total production.
A report released by the Philippine Statistics Authority on Tuesday showed farm output growth in the first three months of the year slowed from the 2.2% logged in 2017’s fourth quarter, as well as the 5.28% seen in the comparable year-ago period.
The first-quarter performance was likewise well below the 2.5-3.5% annual farm growth target under the 2017-2022 Philippine Development Plan.
This slower pace likely pulled down economic expansion in the three-month period which the PSA is scheduled to report on Thursday, with the agriculture, hunting, forestry and fishing sectors contributing about a tenth to the country’s gross domestic product.
Land Bank of the Philippines (LANDBANK) market economist Guian Angelo S. Dumalagan said the slowdown in the sector’s growth last quarter was within expectations due to unfavorable weather conditions.
Three storms in the first quarter — Agaton, Basyang and Caloy — amplified the aftermath of typhoon Vinta in December 2017, affecting the crops and fisheries subsectors.
“The deceleration in production volume, however, was tempered by the agricultural programs of government, such as the distribution of hardy plant varieties and the provision of technical assistance to farmers,” Mr. Dumalagan said.
SUBSECTOR PERFORMANCE
The crops subsector, which contributed 53.76% to total agricultural output, grew by 1.79% in terms of volume in the period, driven by staples rice and corn, as well as coconut. This is slower than the previous quarter’s 2.66% and last year’s 8.13%.
Palay output went up by 4.61% to 4.62 million metric tons (MT) compared to the 12.38% growth a year ago, while corn output likewise increased by 4.66% to 2.48 million MT slowing from the 23.44% expansion in 2017’s first quarter.
Despite the deceleration in the crops’ growth, expansion continued on the back of financial interventions from the Department of Agriculture such as the Production Loan Easy Access and Special Assistance for Agricultural Development programs.
PSA also noted an expansion in harvest areas, improved irrigation and early planting and harvest in some areas ahead of expected rains.
Agriculture Secretary Emmanuel F. Piñol said there was “increased adoption among farmers of modern technology especially good quality seeds.”
“There is now greater awareness among the farmers that made them realize that by using good quality seeds, they’re able to increase their harvest by two-fold,” Mr. Piñol said.
“The other main motivator is the good price of palay in the market. Farmers, and of course agricultural sector, will of course respond positively to a very good price for their produce.”
Meanwhile, coconut production registered an 8.45% increase in the quarter, a turnaround from the 2.31% decline seen the previous year, as the sector continued to recover from the effects of 2016’s dry spell.
The total value of the crops subsector went up by 8.24% to P252.2 billion, PSA said.
On the other hand, the livestock subsector posted a 2.11% growth — slowing from 3.24% the previous year — and had a 16.96% share in the country’s total agricultural production. Hog remained as the major growth driver, increasing 2.39%. The subsector’s gross value also went up by 15.46% to P75.5 billion.
The poultry subsector, which contributed 15.93% to the total output, recorded a 5.24% growth in the quarter, faster than the 1.94% expansion logged the year prior. Chicken and chicken eggs grew by 4.93% and 7.42%, respectively, to drive the subsector’s performance. Gross earnings increased by 8.53% year-on-year to P57.5 billion.
Meanwhile, the output of the fisheries subsector continued to decline, dropping by 4.61% in the first quarter from the previous year’s 1.16% slump and sharing just 13.36% in the total agricultural output. PSA said most major species posted lower production in the period except skipjack and seaweed.
Mr. Piñol said the decline in fisheries output was “expected” due to the closed fishing season from December 2017 to March.
Still, despite the drop in volume, the subsector’s gross value grew by 4.63% to P58.8 billion.
PSA said farmgate prices increased by 7.36% in the period. Prices in the crops and livestock subsectors climbed by an average of 6.33% and 13.07%, respectively.
Farmgate prices for poultry likewise increased by 3.13%, while the fisheries subsector also logged an average price gain of 9.68%.
LANDBANK’s Mr. Dumalagan said the increase in farmgate prices was due to weaker farm output, “which has contributed to the overall rise in headline inflation in the first three months of the year.”
“This aggravated the impact of the TRAIN (Tax Reform for Acceleration and Inclusion) law,” he added.
‘BACK TO BASICS’
For PSA’s forecast, Mr. Piñol said palay production is expected to increase by 140,000 MT while corn production will also go up by 80,000 MT this quarter.
“In the second quarter, we foresee an acceleration in growth amid improving weather conditions,” LANDBANK’s Mr. Dumalagan said.
“However, the fisheries subsector is still expected to contract, as this subsector normally recovers slowly from previous weather problems,” he added.
Philippine Institute for Development Studies Senior Research Fellow Roehlano M. Briones told BusinessWorld in a phone interview that to improve the country’s agricultural output, the DA “simply has to go back to the basics.”
Mr. Briones said the department does not need to have a big budget for the sector to catch up with the growth of other industries. — AGAM
PH Agriculture

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