Total farm output expected to be lower in 2010 due to El Niño

Expected farm production output for the whole of 2010 has been reduced from 0.5 to 1.5 percent in July to -0.5 to 0.5 due to the destruction caused by the El Niño weather phenomenon on local farmlands. The prediction came from the Center for Food and Agri-Business of the University of Asia and the Pacific (CFA-UA&P). It, however, expects farm production to recover and post a growth rate of 2.5 to 3.5 percent next year. “The risk of downside [for the farm sector] is higher for 2010," said Dr. Rolando Dy, executive director of the Food and Agri-Business Center on Tuesday during a presentation on the growth prospects of the farm sector for 2010. According to the Center, crop production, which account for almost half of farm sector output at any given period, would post a growth rate of -1 to 0 percent with paddy rice production declining by 2 to 1 percent. “Palay is poised to mark its second straight year of negative production performance although at lower single digit levels. The setbacks were caused by weather disturbances—tropical storms Ondoy and Pepeng in 2009 and the prolonged dry spell in 2010," the report read. Corn output, meanwhile, could go down by 10.5 to 9.5 percent due to a reduced hectarage in the first nine months of 2010 due to the dry spell that also decreased yield. “The industry is still beset by lingering concerns like high production cost, post-harvest losses, low grain quality, and entry of cheap corn and corn substitutes," the report said. Unlike palay and corn, coconut sector will perform well with the recovery of production this year. Coconut production is expected to grow by 4 to 5 percent in 2010 on the back of the recovery of the export markets and slight growth in domestic consumption. Banana production will be slower at 1 to 2 percent compared to 3.7 percent in 2009 due to the poor performance of the sector in the first half of the year as a result of the El Niño phenomenon. For the livestock sector, the Center projected a growth rate of -0.5 to 0.5 percent for the year, while for poultry, the growth rate could settle at 3.5 to 4.5 percent. Fishery, which has been buoying farm growth in recent years, could increase production by only 0.5 to 1.5 percent in 2010. Municipal and commercial fisheries slowed down due primarily to unfavorable weather conditions, high cost of operation and drop in fishing efforts. Dy said that the threat posed by increasing commodity prices in the global market will compound the food supply problem in the Philippines. “Unlike the 2008 food crisis, the focus of attention now is wheat because of weather shocks and lower projections of wheat production for major exporters," said Dy, adding that this could cause flour-based products like bread to become more expensive in the coming months. - KBK, GMANews.TV