Farm output growth slows to 2.02%

MANILA, Philippines – The agriculture sector grew by a slower rate of 2.02 percent in the first quarter of 2009, from a 3.89-percent growth in the same period last year, as corn harvest dwindled due to the early onset of heavy rains, government data showed yesterday.

Based on a report by the Bureau of Agricultural Statistics, farm output growth during the three-month period this year was also weaker than the 3.2-percent growth in the fourth quarter of 2008.

“What the data tells us is that there may be less support from agriculture than has been hoped for,” said Vishnu Varathan, economist at Forecast Pte in Singapore.

“It will add to the pressure on growth for sure but manufacturing will be the main drag given that exports fell off a cliff.”

Agriculture is one of the main pillars of the economy, contributing about 20 percent of gross domestic product (GDP).

More than a third of around 34 million Filipinos with jobs are employed in the farm sector, the second-biggest after services, according to the state’s latest labor force survey.

Crops, which make up nearly half of total farm output, grew just 0.61 percent in the first three months from a year earlier.

Unmilled rice or palay was up 5.13 percent to 3.94 million tons, outpacing the 1.96 percent growth a year earlier, while corn fell 3.39 percent to 1.93 million tons after a 16.93-percent surge in output a year ago.

 The government said heavy rains during the period boosted the rice harvest but weighed on farm yields in most corn-growing areas.

Lower supply has prompted the government to allow private firms to import up to 250,000 tons of corn this year.

The government has forecast agriculture production will rise four percent this year, nearly the same pace as last year’s when output rose 3.9 percent.

Other big gainers in the crops sub-sector included banana, pineapple, tobacco, cassava and tomato.

The livestock sub-sector, which made up 11.82 percent of total agricultural output, posted a modest growth of 2.37 percent with the biggest contribution coming from the hog sector which grew by 2.53 percent.

The poultry sub-sector contributed 15.18 percent to total agricultural output as it posted a growth of 4.08 percent.

The fisheries sub-sector accounted for 24.05 percent of total farm production as it posted a 3.49-percent growth for the period in review.