Williamstown, MA -- (SBWIRE) -- 05/03/2012 -- According to official reports, 2011 saw a year-on-year 2.3% growth in farm output, as favourable weather boosted grain production. We expect Philippines to be a less important factor in global commodity trade in 2012, especially for grains such as rice and sugar - in which large imports from the country usually influence prices to the upside. This is underpinned by a favourable weather outlook which should boost production of these commodities.
- Sugar production growth to 2015/16: 37.5% to 2.86mn tonnes in 2015/16. Production will be supported by strong demand from the soft drinks sectors. To 2016, BMI is forecasting spending on soft drinks to rise by 47% from its 2011 level to US$1.11bn and spending on confectionery to grow by 12% to US$557mn.
- Rice consumption growth to 2016: 6.2% to 14.2mn tonnes. This will be mainly driven by population growth and will also keep the country dependent on imports of the grain to meet robust domestic demand.
- Poultry production growth to 2015/16: 14.8% to 868,300 tonnes. Consumption will be aided by the spread of fast food outlets (which carry a high volume of chicken products) and the increasing popularity of processed meats sold through modern retail outlets as opposed to wet markets where the majority of chicken is currently sold.
- 2012f Real GDP Growth: 3.9% (up from 3.7% in 2011; predicted to average 4.2% from 2011 until 2016).
- Consumer Price Inflation 2012f: 3.7% (down from 4.4% y-o-y in 2011). Central Bank Policy Rate 2012f: 4.0% (down from 4.5% in 2011)
View Full Report Details and Table of Contents
We are growing increasingly concerned that higher input costs could curb farmers' capacity to maintain strong production growth. In fact, in February 2012, participants at the National Rice Farmers' Conference asserted that the existing farmgate prices for palay, or unmilled rice, is 'too low' to even cover production costs, which is largely attributed to increases in the price of pump gasoline. Current farmgate prices are at PHP17/kg (US$0.40/kg) for unmilled rice.
According to a study conducted by a famers lobby group, Kilusang Magbubukid ng Pilipinas (KMP), a rice farmer would have to incur a cost of approximately PHP18.75/kg of palay, significantly higher than what some rice millers have been reported to pay farmers at PHP12/kg, even lower than the official floor price of PHP17/kg. In line with our view for elevated, if not higher, oil prices in the coming months, we believe that this could greatly hinder the production progress of rice in the Philippines where the majority of it is grown by small-scale farmers with little bargaining power.
About Fast Market Research
Fast Market Research is an online aggregator and distributor of market research and business information. Representing the world's top research publishers and analysts, we provide quick and easy access to the best competitive intelligence available. Our unbiased, expert staff will help you find the right research to fit your requirements and your budget. For more information about these or related research reports, please visit our website at http://www.fastmr.com or call us at 1.800.844.8156.
Browse all Food research reports at Fast Market Research
You may also be interested in these related reports:
- France Agribusiness Report Q2 2012
- Nigeria Agribusiness Report Q2 2012
- Mozambique Agribusiness Report Q2 2012
- Mexico Agribusiness Report Q2 2012
- Russia Agribusiness Report Q2 2012
- Thailand Agribusiness Report Q2 2012
- Egypt Agribusiness Report Q2 2012
- South Africa Agribusiness Report Q2 2012
- Indonesia Agribusiness Report Q2 2012
- Turkey Agribusiness Report Q2 2012