Agricultural production dips in 2022

AGRICULTURAL production shrank by 0.1% in 2022, marking the third straight year of contraction, as crops and fisheries output declined, the Philippine Statistics Authority (PSA) said on Wednesday.

Data from the PSA showed the full-year value of production in agriculture and fisheries declined at a slower pace than the 1.7% contraction in 2021. It also missed the Department of Agriculture’s (DA) 1.2-1.5% full-year growth target.

Farm output has contracted for three years in a row, since the 0.3% growth in 2019.

The PSA attributed the decline to lower production in crops and fisheries, which offset the growth in poultry and livestock.

In the fourth quarter, agricultural production declined by 1%, a reversal of its 0.5% growth in the same period a year ago and the 1.6% growth in the third quarter of 2022.

At current prices, the value of production in agriculture and fisheries amounted to PHP 611.52 billion in the fourth quarter, up 9.4% year on year.

The agriculture sector contributes around a tenth to overall gross domestic product (GDP). Fourth-quarter and full-year 2022 economic data is scheduled to be released today (Jan. 26).

“Agriculture performed better in 2022 than in 2021, although improvement is at a very low rate, because of the opening of the economy by the second half of the year and hence, mobility of people (and) goods and services in agriculture is now less constrained,” former Agriculture Undersecretary Fermin D. Adriano said in a Viber message.

However, fourth-quarter production was affected by recent typhoons that caused billions worth of agricultural damage and elevated input costs such as fertilizer and fuel.

Recent typhoons Karding (international name: Noru) and Paeng (international name: Nalgae) caused agricultural damage worth PHP 3.12 billion and PHP 6.4 billion, respectively.

“We were actually expecting a worse performance,” Federation of Free Farmers national manager Raul Q. Montemayor said in a Viber message.

“The minimal 1% decline in the crops subsector, including palay, is suspect, given the major increases in fertilizer, fuel and other input prices which should have led farmers to reduce their hectarage or scrimp on inputs. To some extent, the value of production could have been propped up by higher farmgate prices,” he added.

DECLINE IN CROPS, FISHERIES

Crop production, which accounts for more than half or 59.1% of total agricultural output, fell by 1% in the fourth quarter and full year, reversing the 2.6% and 2.2% expansion in the fourth quarter and full year 2021, respectively.

PSA data showed fourth-quarter crop production declined by 2.5% for palay (from 0.2% growth in the same period in 2021) and 6.9% for corn (from 28.6% growth).

“The slight decrease in the production of rice and corn is expected due to the increase in cost of inputs like fertilizers, fuel and natural calamities,” Danilo V. Fausto, president of the Philippine Chamber of Agriculture and Food, said in a Viber message.

China Banking Corp. Chief Economist Domini S. Velasquez noted the DA had already warned of a drop in rice production as elevated fertilizer prices discouraged farmers to plant.

“The size of their production was actually smaller. They were planting less,” she said in an interview on One News.

Lower production was also seen in rubber (-9%), mango (-5.8%), ampalaya (-4.7%), calamansi (-2.5%), mongo (-1.9%), banana (-0.8%), cabbage (-0.8%), and eggplant (-0.4%).

Only onion and sugarcane production registered double-digit growth in the fourth quarter, with onions up by 23.3% and sugarcane up by 18.7%.

Increments were also recorded in tobacco (8.5%), pineapple (6.6%), potato (5.4%), sweet potato (3.4%), abaca (2.9%), cacao (2.6%), coffee (2.3%), and coconut (1%).

At current prices, the value of crop production amounted to PHP 334.24 billion last year, up 8.2% from 2021.

PSA data also showed fisheries production slumped by 6.6% in the fourth quarter, worse than the 1.1% growth a year earlier. It accounted for 13.8% of the agricultural production during the period.

For the full year, fisheries output shrank by 5%, a reversal from the 0.1% increase in 2021.

“The decline in fish catch had been noted since the beginning of 2000 due to the depletion of our coastal resource areas,” Mr. Adriano said, noting that the country is slow in developing aquaculture due to huge capital requirements and strict bureaucratic processes.

Mr. Fausto noted the fisheries sector needs to be upgraded due to the slowdown in commercial fishing.

“There is a need to expedite the development of our aquaculture farms and the establishment of more mariculture parks with more fish cages, to increase fisheries output,” he added.

During the fourth quarter, double-digit declines were seen in bigeye tuna or tambakol/bariles (-43.7%), mudcrab or alimango (-37%), slipmouth or sapsap (-34.3%), cavalla or talakitok (-34.2%), threadfin bream or bisugo (-31.4%), Indian mackerel or alumahan (-30.9%), grouper or lapu-lapu (-26.3%), Bali sardinella or tamban (-19.8%), tilapia (-14.6%) and tiger prawn or sugpo (-14.4%).

A drop in production was also seen in milkfish or bangus (-9.1%), blue crab or alimasag (-3.8%), roundscad or galunggong (-2.9%), and frigate tuna or tulingan (-1.7%).

On the other hand, production improved for skipjack or gulyasan (23.4%), bigeye scad or matangbaka (18.6%), yellowfin tuna or tambakol/bariles (11.9%), fimbriated sardines or tunsoy (8.1%), and squid or pusit (2.3%).

“At current prices, the value of fisheries production, which amounted to P89.9 billion, was 6.2% higher compared to the previous year’s level in the same period,” the PSA added.

BRIGHT SPOTS

Livestock and poultry were the bright spots in agricultural production last year.   

Mr. Montemayor said he expected the rebound in livestock and poultry production as both sectors were coming from a low base.

“Gains were registered in livestock and poultry as limited repopulation was already happening in the livestock sector and that the previous year’s benchmark was very low because of the African Swine Fever (ASF). In other words, with the opening of the economy and higher demand for meat, there was nothing to go for these sectors but upwards,” Mr. Adriano added.

Livestock production increased by 2.5% in the fourth quarter, a turnaround from the 9.7% decline in the previous year. The livestock sector contributed 14.3% of total agricultural output.

For the full year, livestock output expanded by 1.9%, an improvement from the 17% decline in 2021.

In the fourth quarter, hog and dairy production went up by 3.4% and 1%, respectively.

“Hogs are (on the way) to recovery as commercial farms are learning to live with ASF through proper biosecurity measures,” Mr. Fausto said.

Meanwhile, contractions were seen in goat, cattle and carabao at 2.5%, 0.4% and 0.3%, respectively.

Livestock production at current prices was valued at PHP 96.65 billion, up 8.2% year on year.

Poultry output, which has a 12.8% share to total agricultural production, grew by 1.8% in the October-December period. This growth was slower than the 2.7% seen in the fourth quarter of 2021.

The poultry sector also rose by 7% in 2022, a turnaround from the 0.3% drop from a year earlier.

“Poultry is always resilient and can cope up even with avian flu,” Mr. Fausto added.

All commodities under poultry recorded higher production: duck eggs (4.3%), duck (4.3%), chicken (2.3%) and chicken eggs (0.2%).

At current prices, the value of poultry production increased by 19.1% to PHP 90.73 billion year on year. – Luisa Maria Jacinta C. Jocson, Reporter