RECENTLY, the Senate Committee of the Whole (COW), led by Senate President Tito Sotto, conducted two extensive hearings on the African Swine Fever (ASF) which continues to be a perennial threat not only to the local hog industry, but also the country’s food security.
The hearings underscored the seriousness of this other outbreak, as evidenced by the steep rise in the price of pork in public markets (P360-P400 per kilogram in January) due to the lack of supply, which led to the issuance of a price cap; the decline in the total swine inventory of around 24% compared to the previous year; and the high number of hog owners and farmers affected in at least 12 regions in the country (68,000).
The Department of Agriculture (DA) estimates that there will be a shortfall in the supply of pork of around 380,000 metric tons (MT) this year which was their main rationale for recommending the reduction in tariff rates of imported pork from 30%-40% to 5%-15% and the increase in the minimum access volume (MAV) from 54,000 MT to 400,000 MT. This recommendation has since dismayed many local hog producers who claim that the department is more focused on helping importers rather than our local farmers double-whammied by the effects of ASF and the complications of ongoing COVID-19 pandemic.
In a bid to protect our local hog raisers, the Senate adopted a resolution urging the President to recall Executive Order 128 which reduces tariffs on imported pork and the recommendation to increase the MAV.
To be fair, the ASF crisis is in no way a simple matter. In his position paper, Dr. Roehlano Briones of the Philippine Institute for Development Studies (PIDS) noted that “the hard policy choice is between accepting temporarily high domestic prices and enabling the industry to rebuild rapidly, or allowing prices to decline in favor of the consumer, but slowing down the recovery of the pork industry.”
On one hand, the National Economic and Development Authority (NEDA) emphasizes that lowering the tariff rates and increasing the MAV will benefit 95 million consumers of pork as it will help address the deficit and the rising pork prices.
On the other hand, others argue that such direction will impede the recovery of our local industry who are still unable to compete with the price of imported pork. Moreover, as stated by the former congressman Nicanor Briones of the Pork Producers Federation of the Philippines, the changes in the tariff rates and the MAV is estimated to cost the government around P13 billion in revenues — a significant amount which could have been allocated to support local producers.
During one of the COW hearings, I raised the case of countries like Denmark, the Netherlands, and Belgium from which we import pork. They have smaller arable lands but are able to make their agricultural industries progressive.
In fact, the Netherlands, which is about seven times smaller than the Philippines, is considered the second largest agricultural exporter in the world. In addition, in 2013, according to the Landbouw Economisch Instituut (LEI), the country’s “agricultural sector was found capable of supplying the country’s population of 17 million inhabitants with a varied diet of both animal and crop products, providing each person with over 2,000 calories a day.” In other words, not only are the Dutch able to feed themselves, they are also feeding other countries.
The Philippines, which is primarily an agricultural country, should be aiming for the same measure of productivity — or at least reach such level that in the event of extraordinary crises, such as this pandemic, our citizens could rely on local supply and not on imports.
Our low productivity is especially evident when compared to some of our ASEAN neighbors. It was reported in 2016 that compared to Thailand, Indonesia, Malaysia, and Vietnam, the Philippines is the only country who posted a trade deficit with US$5.1B in food exports against US$11B in imports. The US Department of Agriculture (USDA) also noted that the total factor productivity (TFP) index of the Philippines only increased by 0.64% from 2005 to 2015 — a measly growth when compared to Malaysia with 1.8%, Indonesia with 2.12%, Thailand with 2.16%, and Vietnam with 2.21%.
In order to address this, one of the long-term interventions suggested during the hearings was for the country to invest more strategically towards making the production of our livestock feeds more efficient as this is a major contributing factor to the overall cost. I appreciate the pronouncements of former DA Secretary Piñol that Mindanao is currently integrating the feed material requirements of their livestock and exploring feed additives such as seaweeds.
Reducing our reliance on foreign food producers should be at the forefront of DA’s agenda. And that invariably involves building a robust local industry which prioritizes local production; ensuring that annual budgetary allocations for agriculture is spent well and strategically; evaluating existing programs and investments of the government to determine whether or not they are meeting their intended goals; and investing in research and development for innovation.
