AGRICULTURE Secretary Emmanuel F. Piñol said that the Department of Agriculture (DA) will compensate farmers in the Cordillera Administrative Region (CAR) who were forced to dispose of their vegetables due to oversupply and lack of means to transport the harvest to market.
“Cordillera farmers who were forced to dump or throw away truckloads of vegetables because there were no buyers will have to be compensated by the government,” Mr. Piñol said in a Facebook post on Thursday.
“I made this decision tonight following confirmation by Cordillera Agriculture officials that the reason behind the failure of the farmers to sell their produce was Tropical Depression Usman which caused floods in the Bicol Region,” Mr. Piñol added.
According to Mr. Piñol, traders were not able to buy the produce to transport to Bicol and the Visayas due to flooding brought by Usman.
Bicol is part of the overland supply route to the Visayas, connected by ferries.
“It was made clear that Tropical Depression Usman was the root cause. I made the decision to order the compensation of the farmers,” Mr. Piñol said.
Prices of vegetables such as cabbage, carrots and potatoes dropped to as low as P5 per kilo at the trading post level due to oversupply.
An economics professor specializing in agriculture said that there should be agroprocessing facilities in the Cordillera region to absorb the produce of the farmers, as well as farm-to-market roads (FMR).
“Agroprocessing plants are needed in Benguet. The current practice is to process in Clark because it’s an export processing zone and has good logistics,” Marites M. Tiongco, Dean of the De La Salle University (DLSU) School of Economics (SoE), told BusinessWorld in a mobile message.
“The vegetable production of Benguet can be distributed to different outlets — the domestic, processing and export markets,” according to Ms. Tiongco.
Ms. Tiongco also pushed for commodity contract trading to do away with middlemen.
“Commodity exchange center with cold storage facilities the solution, and efficient logistics,”
The Securities and Exchange Commission (SEC) said it is planning to set up a commodity exchange, with discussions set for the coming month.
“It’s among our plans. We will firm it up during our strategic planning next month. But it’s still a plan as of now,” SEC Chairman Emilio B. Aquino said in a text message.
Ateneo de Manila University (ADMU) Dean of the School of Government Ronald U. Mendoza, meanwhile, said in a Facebook post that technocrats, and not politicians should hold key jobs in agriculture.
“Farmers need support to be better organized and equipped into competitive and well managed coops. There should also be safety nets available for shocks. And we should mitigate smuggling,” Mr. Mendoza said in a text message.
University of Asia and the Pacific (UA&P) Center for Food and Agribusiness Executive Director Rolando T. Dy said that the oversupply was caused by supply chain problems with the region’s access to urban markets breaking own.
“It’s force majeure. It is related to supply chain infrastructure, [which] can be a rising problem,” Mr. Dy said.
Asked what is lacking in the agriculture industry of the region, Mr. Dy replied, “connectivity to urban markets from CAR.”
Mr. Piñol said that most of the farmers who lost their produce are beneficiaries of the DA’s Production Loan Easy Access (PLEA) program wherein farmers can borrow up to P50,000 at 6% annual interest.
Another lending program is run by the Agricultural Credit Policy Council (ACPC) which has allocated P100 million for Cordillera vegetable farmers. Some might have also borrowed funds from informal lenders, Mr. Piñol noted.
“Tomorrow, the DA and the Philippine Crop Insurance Corp. (PCIC) will start the validation process which will involve the identification of farmers who suffered losses and the estimated value of the vegetables they threw away,” Mr. Piñol said.
“The validation process could take two weeks, after which the release of the insurance payments will start,” he added. — Reicelene Joy N. Ignacio