Agri exports rise on favorable weather conditions, demand
By Christine J. S. Castañeda,
Senior Researcher
THE TRADE DEFICIT in agricultural goods narrowed in the second quarter amid an increase in exports and lower imports, the Philippine Statistics Authority (PSA) reported.
The PSA said exports of farm products amounted to $1.338 billion in the three months to June, up 23.9% from a year earlier.
Meanwhile, imports amounted to $2.673 billion in the second quarter, down 5.6%.
Total trade in agricultural goods comprised 10.17% or $4 billion of the total of $39.4 billion in the second quarter.
As a result, the agricultural trade deficit was $1.335 billion during the period, down from $1.751 billion a year earlier.
Rolando T. Dy, executive director of the University of Asia and the Pacific (UA&P) Center for Food and Agri-Business, said the leading drivers for export performance were vegetable oil, including coconut oil; edible fruit; prepared fruit; fish; and prepared fish.
“For the top five commodities, export values are driven by higher quantities, except coconut oil which posted higher quantity and price,” Mr. Dy said, adding that the higher volume of agricultural exports was driven by improved output.
Ruben Carlo O. Asuncion, chief economist at Union Bank of the Philippines (UnionBank), said favorable weather and strong demand drove the quarter’s trade performance.
“Important subsectors of agriculture have contributed to the boost in agriculture output. The subsectors of palay, corn, sugarcane, and poultry including agricultural services have risen in the second quarter of this year,” he said.
Asked about the performance of imports, Mr. Asuncion said: “When the agriculture sector of a country perennially hit by weather disturbances becomes buoyant due to fewer typhoons or storms, domestic supply of agricultural goods becomes more favorable.”
“This might be the case for second quarter agriculture imports declining because the need to augment domestic supply is not so much needed.”
Animal and vegetable oils were the top export product at $325.25 million, or 24.3% of the total goods shipped.
Other top agricultural exports were edible fruits and nuts ($299.16 million); prepared vegetables, fruits and nuts ($155.19 million), fish and other seafood ($117.02 million), and prepared meat, fish and other seafood ($91.78 million).
Meanwhile, cereals were the top agricultural import at $372.10 million, followed by “miscellaneous edible preparations” ($350.98 million); residues and waste from food industries ($311.30 million), meat and edible offal ($279.41 million) and animal or vegetable fats and oils ($242.93 million).
Trade in agricultural goods with Japan was in surplus by $153.52 million, up 29.1% from a year earlier. The biggest deficit in agricultural trade was with the Association of Southeast Asian Nations (ASEAN) at $700.45 million, followed by the US, Australia and the European Union with deficits of $315.99 million, $217.68 million and $5.69 million respectively.
UA&P’s Mr. Dy expressed optimism that last year’s exports of about $5 billion “might even reach $6 billion” this year, he said.
PSA data released on Aug. 14 showed that agricultural exports totaled $5.280 billion in 2016.
UnionBank’s Mr. Asuncion added: “If the current weather system continues to cooperate, I see agricultural trade in the next 12 months to be consistently contributing to economic expansion.”
