Ahead of typhoons, agriculture gives fresh growth boost in Q3
MANILA, Philippines — Agriculture notched a quicker expansion in third quarter, cementing the sector as a reliable growth source for the shrinking economy despite future risks that typhoons and a contagious hog disease would disrupt gains.
Farm production grew 0.7% year-on-year in 3 months ending September, slower than the 2.3% posted same period a year ago but slightly faster than 0.5% in second quarter, the Philippine Statistics Authority reported on Monday.
“The 0.7% positive growth is a welcome news, as it confirms that we are on the right track particularly on our palay and corn production program initiatives in partnership with farmers’ groups, local government units and the private sector,” Agriculture Secretary William Dar said in a statement.
Agriculture was an unusual bright spot for an economy that likely shrank anew last quarter, albeit slower than the revised record-low of 16.9% on-year from April to June. Crops, which accounted for 52.7% of output, led the sector with 4.8% growth, followed by fisheries with 1.9% expansion in the third quarter.
“Although it grew minimally, I expect the agriculture sector to help ease the economic drag caused by the pandemic and soften the negative impact of constrained economic activities on Q3 GDP,” said Cid Terosa, senior economist at University of Asia and the Pacific School of Economics.
But past month’s weather disturbances are darkening the outlook for the two subsectors. Typhoons Quinta and Rolly last month damaged P5.6 billion in farm produce, mostly rice fields in northern Luzon and Bicol where they made landfall, cutting down inventories of the main staple by an average of 4 days.
But Dar was unperturbed. “Our inventory, currently 94 (days), lost only 4 days. We still have 3-month worth of rice for the country,” he said in ABS-CBN’s Teleradyo on Monday morning.
Indeed, palay production had been healthy so far this year, growing 15.2% on-year in previous 3 months despite initial market disruptions from lockdowns in April to June. Corn, which serves as alternative to rice, increased 3.5% annually.
Beyond crops however, problems also persisted in livestock where the resurgence of African swine fever cut off 7.6% of its value from last year. Already, the spread of disease among hogs have limited pork supply in Metro Manila and neighboring areas where pork prices also surged.
Still under livestock however, dairy products rose 16% year-on-year in the third quarter on account of higher demand.
In contrast with dairy, poultry products suffered from dismal consumer demand, pulling down production value by 3.8% year-on-year in third quarter. Under this segment, chicken output shrank 7.2%, offsetting gains from duck that rose 2.3%, chicken eggs (6%) and duck eggs (3.1%).
Despite two succeeding quarters of growth, agriculture remained down 0.2% year-on-year for the first 9 months, owing to a hefty 1.7% drop in the January-March period. Broken down, crops grew 2.3%, fisheries 0.2%, but livestock and poultry offset these with declines of 5.5% and 2.8%, respectively.
As the final quarter reaches halfway, UA&P’s Terosa said it is imperative for agriculture to swing to growth by yearend.
“It is important for the agriculture sector to register positive growth no matter how small since it has important positive implications on the welfare of the many poor households and individuals dependent on agricultural production, particularly crop production and fisheries,” he said in a text message.