Poultry stakeholders call for long-term solutions amid high inflation

Poultry stakeholders called on the government to come up with long-term solutions to ensure that the Philippines will continue to have enough supply of chicken amid the elevated prices of various commodities.
 
In a statement, the stakeholders in the poultry sector said that the industry was hit by high inflation, which clocked in at a 14-year high of 8.7% in January.
 
United Broiler Raisers Association (UBRA) chairman Gregorio San Diego said feed prices are at an all-time high, prompting the cost of production to increase as well.
 
Last year, inflation settled at 5.8% following the impact of the Ukraine-Russia war, which affected oil prices and eventually crept into other commodities.
 
American Chamber of Commerce agribusiness committee chairman Christopher Ilagan said that the poultry sector has heightened its vigilance on pressures that may cause prices to rise, especially input costs, animal disease, and general supply levels.
 
According to poultry stakeholders, the reduction of corn tariffs managed to help the industry and provided a base to keep prices a bit tempered amid a high-inflation environment.
 
They said that corn constitutes up to 60% of feed costs, while feed costs constitute roughly 70% of poultry meat production.
 
However, to make the tariff reduction effective, Ilagan said the government should rethink the minimum access volume (MAV) of 217,000 metric tons when the deficit is at a high of three to five million MT.
 
“An increase in the MAV quota for corn coupled with a more equitable distribution of MAV allocations can more drastically help bring down corn prices, which saw a 26% increase,” Ilagan said.
 
Vitarich Corp., a poultry and feed manufacturing firm, echoed the sentiment that there is not enough corn supply.
 
Vitarich spokesperson Karen Jimeno said that the ideal situation is to have corn prices stable for the year so as not to suffer spikes in input costs.
 
“The right policies should be put in place as soon as possible so that the price of inputs can be stabilized sooner,” said Jimeno. “It’s really the purchasing power of the consumers that determines our selling price.”
 
Moving forward, the stakeholders said that rather than looking at reactive solutions like increasing imports, the Philippines needs long-term solutions that support the local value chain.
 
Jimeno said the government must improve infrastructure to support the value chain as well as rationalize the taxes imposed by national and local governments.
 
“For instance, poultry producers pay varying local taxes when simply passing through different cities or municipalities; apart from the cost, the lack of uniformity makes doing business more complicated,” she said.
 
Ilagan added that a solution should also be found for the encroachment of residential and commercial areas on agro-industrial zoned areas, which limits space for expansion of the sector.
 
He said that efforts must be made to ensure structural reforms are undertaken across the value chain.

He also supports pending bills in Congress that seek to transform the livestock and corn sectors.
 
Further, Jimeno said that the government should eventually steer away from relying on imports of chickens, as doing so is not only ineffective but also harms everyone in the local value chain.
 
“The local chicken industry has the capacity to meet market demand, but there are factors that prevent it from ramping up consistently,” she said.
 
Jimeno and San Diego said that there is a lack of data from the government, which prevents local producers from planning how much to produce.
 
“The government must create a complete and accurate data system for the whole of agriculture so that Filipino farmers will be properly guided in production,” San Diego said.
 
“We must use data-driven decision-making so we can manage the ebb and flow of supply versus demand. The government must constantly communicate and collaborate with all stakeholders to find solutions so we can thrive even in uncertain conditions,” Jimeno added.  — VBL, GMA Integrated News