FARM OUTPUT rebounded in the fourth quarter to post a slight expansion, but was not enough to push the full-year growth to reach the government’s target, according to data the Philippine Statistics Authority (PSA) released on Wednesday.
The value of total farm production grew 1.8% in the October-December period, the PSA reported, a recovery from the 0.83% contraction logged in the third quarter but slower than the previous year’s 2.26%. This was the fastest quarterly pace of growth seen last year, surpassing the first and second quarter’s 1.47% and 0.07%, respectively.
The fourth-quarter print brought full-year farm output growth at 0.56% — well below the 2017’s 3.96% expansion and the Department of Agriculture’s (DA) 2.5% goal, as well as the targeted 2% of economic managers.
The DA attributed the year-on-year slowdown to the typhoons and tropical depressions that hit the country.
The PSA said the fourth-quarter growth was driven by increases in production across all subsectors.
The crops subsector, which accounted for 50.40% of total agricultural output, grew by 0.25% in the fourth quarter of 2018, down from 2.68% in the comparable year-ago period. This was despite a 2.2% decline in palay production to 7.156 million metric tons (MT). The slight growth was attributed to increases in production of corn (10.82% to 1.805 million MT), coconut, banana, pineapple, coffee, mango, tobacco, abaca, mongo, tomato, onion, cabbage and rubber.
On an annual basis, crop production dropped 0.98% versus 2017’s 6.69% expansion as palay output — the biggest contributor to the subsector — declined by 1.09% to 19.066 million MT from the previous year’s 19.276 million MT. Corn production likewise dropped 1.81% to 7.771 million MT in 2018 from 7.914 million MT in 2017.
Meanwhile, the livestock subsector’s output increased by 1.64% in the fourth quarter, slower than the previous year’s 1.84%. The sector contributed 17.74% to total agricultural production, as carabao, hog, and dairy saw gains. For 2018, livestock production went up by 1.89%, faster than the prior year’s 1.12%.
Poultry production also expanded by 6.99% in October-December, faster than the comparable year-ago period’s 4.73% and accounting for 16.18% of the total output. For 2018, poultry output went up by 5.75% versus the prior year’s 4.62%.
The fisheries subsector also saw its output grow by 1.93% in the fourth quarter versus the previous year’s 0.92% contraction to take a 15.68% share in total production, as all major fish species except for roundscad and yellowfin tuna recorded increases. However, it still logged a 1.13% contraction for the entire year, slightly better than 2017’s decline of 1.68%.
DA Secretary Emmanuel F. Piñol said agriculture will be in a better position this year on the back of funding that could help develop the sector.
“They are banking so much on the RCEF (Rice Competitiveness Enhancement Fund) and the release of the coco levy funds for agriculture to be able to bounce back in 2019,” Mr. Piñol told reporters on Wednesday.
“We are keeping our fingers crossed that the RCEF will be released earlier and the coco levy will be released earlier,” Mr. Piñol added.
Mr. Piñol said the RCEF should be released by the start of planting season. He added that the DA has already coordinated with the National Irrigation Administration (NIA) to change the planting cycle beginning this year to avoid weather-related agriculture damage.
The farm sector generates about a fourth of the country’s jobs but contributes just a tenth to gross domestic product (GDP). PSA is scheduled to report official fourth-quarter and 2018 GDP data today.
UnionBank of the Philippines Chief Economist Ruben Carlo O. Asuncion said the agriculture sector had no significant contribution to the economy in 2018.
“Its contribution to growth this year is practically nil. There is a need for a more comprehensive plan to really address this problem. We have natural advantages like land, compared to Singapore, and Middle Eastern countries that import a lot of their food. It’s really a matter of doing it,” Mr. Asuncion said.
“That’s why there’s a need for microfinancing. There’s a huge need to bank the underbanked or the unbanked. You can only make your lending sophisticated if these people that’s supposed to get the money to invest in agriculture or planting get more sophisticated eventually. The only way to do that is help them upgrade,” Mr. Asuncion added, noting that poverty prevails in the agriculture sector.
Meanwhile, University of Asia and the Pacific (UA&P) Center for Food and Agribusiness Executive Director Rolando T. Dy said the government should focus on high value crops instead of rice to improve the sector’s gross output.
“The problem in our agriculture sector, they place everything on rice. The other crops — coffee, rubber, onion, coconut — these are factors neglected. It is a basket of commodities, they call it high-value. It probably comprise maybe equal or greater in contribution with rice to gross value added,” Mr. Dy said.
“In terms of poverty alleviating impact, that will have a greater impact than rice,” Mr. Dy said. — R.J.N. Ignacio
Performance of Philippine agriculture (Q4 2018)