Aboitiz food unit mulls more local sourcing

Pilmico Foods Corp., the food unit of conglomerate Aboitiz Equity Ventures Inc., intends to expand local sourcing of raw materials, particularly corn, amid the continued demand for feeds in the country.

Pilmico chief operating officer Tristan Aboitiz said the company is studying different opportunities in Northern Luzon and Mindanao to strengthen collaboration with local farmers and cooperatives for the supply of Pilmico’s corn requirement for its various animal feeds products.

Corn is the main raw material in producing animal feeds.

“We want to pursue and be able to do more of local sourcing. We are looking around Central Luzon and also more in Bukidnon, which are near our Tarlac and Iligan (feed mill facility),” Aboitiz told reporters.

Earlier this year, Pilmico ventured into its first corn sourcing program with Mantibugao Agrarian Reform Beneficiaries Farmers Cooperative (MARBFC) in Bukidnon.

“It benefits everybody, the farmers don’t have to work through middlemen and it benefits us also because we are able to access quality raw materials. We need to secure supply,” Aboitiz said.

“We want to make sure we work in the process well because they (farmers) are typically used to selling to traders. We have to be able to work with cooperatives in a more organized manner,” he said.

Local corn production remains challenging as it is expected to post a 16 percent drop to 2.18 million metric tons in the third quarter from 2.59 million MT in 2017.

This as harvest area may contract by 11 percent to 784,000 hectares and yield may decline to 2.78 MT per hectare from 2.93 MT per hectare last year.

However, for the last quarter of 2018, corn production is expected to increase as farmers signify more plantings in anticipation of good weather condition and government intervention on seed subsidy.

Pilmico said it would likely infuse P1.7 billion in the next three years as part of its expansion plan to ramp up its foothold in the local feeds industry.

Pilmico aims to increase its foothold in the feeds industry by growing animalfeeds related businesses in the Philippines and export its feed products to Vietnam, Indonesia, and the Pacific.

Majority of Pilmico’s feeds production is being consumed by the Visayas and Mindanao market. Pilmico produces an average 70,000 MT of feeds per month, more than half of which is for swine while the remaining is allotted for poultry, game fowls, and others.

Pilmico is primarily engaged in the manufacture and sale of flour, feeds, and their by-products. It has a network of distributors and dealers located in the major cities of Manila, Cebu, Davao, Iloilo, Bacolod and Cagayan.