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Salceda says “fertilizers almost certain” to be part of SONA; House tax panel chair says cheaper fertilizers, discount coupons “will bring down food prices”

July 21st, 2022

House Ways and Means Chair Joey Sarte Salceda (Albay, 2nd district) emphasized today the importance of cheaper fertilizers in the government’s efforts to lower food prices amid a global food price surge. The House tax panel chair, in an interview with the press today, said that “fertilizers will almost certainly be mentioned” in the first State of the Nation Address of President Ferdinand Marcos Jr.

“One of his quickest victories as Agriculture Secretary can be fertilizers. I commend his effort to pursue government-to-government procurement of fertilizers. That gets rid of a lot of middlemen margins,” Salceda said.

Salceda added that “apart from the G2G procurement, I also strongly urge PBBM to release fertilizer discount coupons, backed by the national government and good as currency when buying fertilizers. We used this system heavily in the province of Albay, when I was governor. It will have immediate consequences to food yield during the ongoing rainy season planting time,” Salceda added.

Salceda says he particularly sees it “being most useful in palay, which is fertilizer-intensive, and in corn, which has cascading effects on the prices of feeds, and therefore of poultry and pork.”

“The tradeable coupons are very strategic at this point, because regardless of whether the farmer beneficiary actually uses them or trades them to another farmer, the end result will be that the discounted fertilizer will find its way into the land. And that will bring higher yields for key crops, while also helping address high fertilizer prices.”

According to the World Fertilizer Price Index, current prices are 75% higher year-on-year.

“Prices have been going up in part because of global trade constraints. Belarus accounts for about a fifth of the world’s potash supply. Russia is the world’s largest exporter of nitrogen fertilizer and second largest importer of phosporus and potassium fertilizers. So, the Russia-Ukraine crisis will definitely continue to affect global fertilizer prices.”

“The fertilizer price index peaked at 101.5% higher than last year’s prices. There are signs that prices are cooling down, because prices have been moving down consistently since April, but fertilizer prices are still at elevated levels.”

Salceda also says that organic fertilizer “could be a good supplement, although I would still advice against depending on it. In raising yields, there is still no viable mass substitute to inorganic or synthetic agriculture.”

“I think PBBM can score very quick and extremely useful wins as DA Secretary by focusing first on fertilizers. It is the most important short-term intervention.”

As early as 2021, Salceda had already called for incentivizing the production of domestic fertilizers. In a press statement then, Salceda said “Mark my words, there will be a global shortage of synthetic fertilizers.”

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