Agriculture output in Q1 seen flat following typhoon damage, ASF

AGRICULTURAL PRODUCTION in the first quarter of the year is estimated to have been little changed due to typhoon damage and the continuing impact of the African Swine Fever (ASF) outbreak, analysts said.

Pampanga State Agricultural University professor Roy S. Kempis said “not much” is expected from the agriculture industry in the first quarter.

“Flat growth may emerge that will not be far from the growth rate (from the previous quarter),” he said.

He estimates that the value of production in the agriculture sector will remain flat, between minus 0.5% and 0.5%.

The value of production in agriculture in the fourth quarter last year rose by 0.6%. In the first quarter of 2021, output declined by 3.4%.

In 2021, agricultural output contracted by 1.7%.

Mr. Kempis said that crops and fisheries will remain a “bright spot” for output in the first quarter, but overall output will remain hampered by the livestock sector due to the resurgence of ASF early in the year.

“This will be driven by crops, fisheries and poultry in the same order of importance. Not much can be contributed from the livestock sector. Instead, it will be the Achilles heel because of ASF and the reluctance of livestock farms to open again soon,” Mr. Kempis said.

As of March 2022, ASF was still active in five regions, nine provinces, seven municipalities, and 12 barangays.

According to the statistics authority, the industry has lost 3 million hogs to the disease or to precautionary culls between 2019 and 2021.

“Livestock is expected to still be struggling. A capital-intensive industry, this will take more time to rebound, perhaps three to five years,” Mr. Kempis added.

He added that a negative outcome can emerge because of agricultural damage by Typhoon Odette (international name: Rai), which struck only two weeks before the first quarter of 2022.

The Department of Agriculture reported that crop damage due to the typhoon amounted to P13.3 billion.

The storm affected 533,709 farmers and fisherfolk across 462,766 hectares of agricultural land, with the volume of lost production at 273,062 metric tons (MT).

Regions mainly affected were Capiz, Iloilo, Negros Occidental, Cebu, Negros Oriental, Eastern Samar, Leyte, Southern Leyte, the Surigao Provinces, Davao de Oro, and Agusan del Sur.

“It will take time for these provinces to fully recover. And this may not happen in the first quarter.  These provinces are rice producing areas especially those in Western Visayas which can be considered the second most important rice producing area after Central Luzon,” Mr. Kempis said.

“Likewise, these affected provinces include rich marine fishing grounds in the bays of Eastern Visayas and Western Visayas. Their marine fishing grounds not only involve fish capture but marine aquaculture. The latter’s sea-based aquaculture farms could have been devastated by the typhoon. Repairs may not be enough but additional capital investment may be necessary. And the latter could be a challenge, albeit temporarily not only in fisheries but also in crops and poultry,” he added.

United Broiler Raisers Association President Elias Jose M. Inciong said that demand was also down in the first quarter because of the Omicron surge and lockdowns in January.

“Producers would have been conservative at the time, especially broiler raisers. Costs were (also) already on the high side even before the Ukraine war,” he said in a Viber message.

Mr. Kempis said that coming from the fourth quarter in 2021, there was a period of enhanced consumption because of the holiday season that also served as an incentive to produce more.

“The first quarter is expected to feature a slowdown in consumption and in turn production, processing and manufacturing of food shall also slow down,” he added. — Luisa Maria Jacinta C. Jocson