Agri sector grows 3.17% in H1

The agricultural sector managed to post a 3.17-percent growth during the first semester of the year despite strong typhoons and the prospects of a prolonged dry spell, the Department of Agriculture (DA) reported yesterday.

Although the 3.17-percent growth was lower than the 4.3 percent recorded in the same period last year, Agriculture Secretary Leonardo Q. Montemayor said the expansion is "fairly reasonable."

"The first half of 2002 was a challenging period for the farm and fishery sector. The dry spell brought positive impact on some crops and even in the area of commercial fishing while it worked negatively on other sectors," he pointed out.

"But the bottom line is, agriculture still managed to grow during the period," he added.

Farm output actually grew less in the second quarter than in the first, but officials said the country remains on track to achieve GDP growth targets for the full year.

The farm sector makes up about 20 percent of the country’s gross domestic product (GDP) and any slowdown in agricultural output raises the prospect of shrinking overall growth.

The DA said farm output in the second quarter was up 2.54 percent over the year-ago period. The comparative number in the first quarter was 3.72 percent, and GDP growth in that period came in at 3.8 percent.

"We didn’t really project a strong growth for agriculture in the second quarter," Socio-economic Planning Secretary Dante Canlas told reporters. "It (the growth) is on track (to allow us to achieve) the full-year GDP growth of 4-4.5 percent."

4CAST Ltd said the farm sector data pointed to GDP growth of 3.5-4 percent in the second quarter, close to government estimates of 3.8-4.0 percent.

The government is to announce second quarter growth data on August 30.

Astro del Castillo, head of research at A&A Securities, said the farm sector number was not unexpected.

"I think agriculture is not that bad," he said. "Agriculture will still be one of the key components (of GDP) and manufacturing, hopefully, will eventually bounce back within this year. I guess we are still betting on those two sectors (to attain the target)."

Farm sector prospects for the rest of the year were not too favorable, however.

Montemayor said full-year farm sector growth was likely to be 2.7 percent, the lower end of the government’s 2.7-3.6 percent range. A forecast recurrence of the El Niño weather pattern later this year is likely to affect output.

He said also that the main crop – rice – was likely to be at 13 million tons this year from an earlier estimate of 13.3 million tons and that more imports of the cereal could not be ruled out.

The Philippines has already imported 890,000 tons of rice this year.