As farm output declines, agri investments, reforms pushed

HE contraction of agricultural output is a wake-up call for stronger investment in agriculture sector and for a policy reform, an economistlawmaker said at the weekend, after the statistics agency reported the GDP numbers for 2021.

TFor House Committee Ways and Means Chairman Joey Sarte Salceda, the contraction of agricultural output by 1.7 percent based on 2021 full-year GDP figures, is a “warning sign that even with a low output base, our agriculture sector is still struggling to grow.”

Salceda also suggested adopting crop diversification as a strategy to meet agricultural output goals.

“We need to grow agricultural output by at least 2 percent to outpace our population growth and produce enough to support our country’s needs. If we can’t produce our staple foods at competitive prices, we should diversify to other high-value crops to meet that output objective,” Salceda said in a statement.

“The livestock sector is also what’s dragging our agriculture sector down. Full year livestock output declined by a massive 17 percent. That’s worse than anything we’ve seen in recent years,” Salceda added.

Last week, Philippine Statistics Authority (PSA) said the country posted its slowest agriculture production growth in over two decades.

Based on PSA data, agriculture growth contracted 1.7 percent in 2021, the lowest since 2001 under the 2018-based data. The PSA has only rebased data to 2018 only until 2001.

“The problems of the livestock sector are: one, lack of economies of scale. Most producers are backyard producers. Two, lack of cheap inputs. Feed costs in the Philippines remain among the highest in the region. Three, disjointed government support. You have several agencies for different livestock products, when you could consolidate that into a National Livestock, Poultry, and Dairy Program since the inputs, the problems, and the issues are very similar and require close coordination,” Salceda added.

Livestock reform

IN response to the release of agricultural output data for 2021 this week, Salceda said that he is working with the Department of Agriculture to draft a reform program for the livestock, poultry, and dairy sectors.

“The key components are as follows: First, we consolidate the agencies handling livestock into a single umbrella. Second, we allocate tariff revenues in imported corn towards the development of cheap domestic corn, and revenues from imported feeds towards the development of cheaper feed alternatives. Three, we create a national livestock, poultry, and dairy development plan to be reviewed every five or six years. Fourth, we organize support services and invest in related infrastructure, from farm transport to slaughterhouses,” Salceda said.

A complementary reform is also to set the parameters for public-private partnerships in the livestock, poultry, and dairy sector, to make the agriculture sector less susceptible to budget cuts, Salceda said.

“Finally, we also need to reform the Bureau of Animal Industry’s biosafety and inspection processes to make the sector more resilient against biohazards such as the African swine fever. We are already working on that in the Committee on Ways and Means, during our discussions on the livestock import process,” Salceda said.

“The Department of Agriculture sent me briefing materials last week that we are studying now to craft an administration version of this reform. I am optimistic that we will be able to at least get the ball rolling, so that the next administration will have something to start with on Day One,” Salceda added.