December 6th, 2021
House Ways and Means Chair Joey Sarte Salceda (Albay, 2nd district) boosted Agriculture Secretary William Dar’s request for an additional P12 billion budget for the Department of Agriculture, citing the significance of the expanded programs in making the price of key commodities such as meat and vegetables “stable.”
“Inflation is the next big enemy after we have defeated the prospect of a stagnant recovery. We need lower prices for meat and vegetables, and feeds and fertilizers will play an important role.”
“As I said in a speech in February this year, when it comes to livestock prices, it’s all about feeds, feeds, feeds. And the DA is proposing increased spending in the corn development program. After supply issues in meat due to the African Swine Fever, and considering the reduced cost-competitiveness of our domestic meat industry, we need a strong feed sector.”
“The cost component of feed per kilo of swine meat is 64 pesos. That is at least 4 pesos higher than our competitors. The cost of animal feed as a share of total production costs is around 60%. That makes cheap corn very important to lowering meat inflation, the fastest growing component of general prices this year.”
“That is why I support Secretary Dar’s call for an expanded national corn program. We need to prepare the country’s corn supply for what will inevitably be a sudden spike in demand as the country’s hog production ramps up next year,” Salceda added.
Salceda says fertilizers need subsidies too
Salceda also asserted that the DA’s request for a fertilizer subsidy is “well-founded on current circumstances, especially as fertilizer has gotten more expensive every year.”
Salceda cited that the “Fertilizer Price Index has skyrocketed this year, going from 82.96 points at the start of the year to 204.51 points as of November.
“That adds to the pressure on vegetable prices, as well as the price of rice and corn, both of which are very heavy users of fertilizer.”
“If we don’t provide fertilizer subsidies, we could se drastic upward pushes in cost of corn and rice, as well as derivative or allied sectors such as livestock.”
“Add to this the rising fuel costs and you have a perfect storm for a very bad year for farmer incomes this year. I agree with the DA that this is a necessary intervention. If I had it my way, the subsidy would be bigger. You probably need something closer to 9.6 billion rather than the DA’s request of 8.9 billion,” Salceda added.
“This is an impending global crisis in fertilizer prices since phosphate is a very finite resource. We probably need to come up with organic, farm-grown alternatives soon. But for now, we really need to help struggling farmers. The costs they have had to bear this year are among the highest ever. If we don’t help them, prices go up for everyone.”