MVP sees large-scale comm’l farming as key to poverty reduction

MANILA, Philippines - Leading industry players in agriculture believe pursuing large-scale commercial farming of vari- ous industrial crops and technology adaptation is key to poverty reduction in the farm industry.

During a GoNegosyo forum for agriculture held at Manila Polo Club Friday night, large investors in the agriculture sector said having opportunities to pursue large-scale cultivation of key commodities like sugar, rice and oil palms would enlarge the share of agriculture to the gross domestic product (GDP) and revive interest in the industry.

“We are businessmen, when we see market deficiencies, we look into it and do something. The view of most Filipinos about agriculture is that it’s business for the poor,” said businessman Manuel V. Pangilinan, managing director and CEO of Hong-Kong-based First Pacific which has agricultural investments via Indofood.

Pangilinan said agriculture in the country would prosper if farmers adopt an entrepreneur- ial mindset.

“The question of channeling credit to farm- ers, the essential thing is to improve the credit quality of farmers. We have to ensure that the business of the farmers is good in the general sense,” he said.

Pangilinan said the government could help the private sector maximize investments in ag- riculture if it could institute mechanisms for the consolidation and leasing of large tracts of prime agricultural lands to large investors like what is being done in Indonesia.

“We have to get into commercial farming. We have to let the private sector in but where do we get the land,” he said. “If we can get into the commercial sense, business will come in and prosperity will follow.”

Late last year, First Pacific acquired a 34 percent stake in local sugarmiller Roxas Holdings. Inc. (RHI), one of the large sugar millers in the country.

In selling equity to First pacific, RHI intends to take advantage of the global conglomerate’s reach in Vietnam, Indonesia and Cambodia.

Sugar is one of the Philippines’ traditionally strong industrial crop, but Pangilinan notes that growth in the sector has been static and would have to be ramped up to enable the industry to remain competitive in the ASEAN free trade regime that would be enforced in 2015.

“In the case of sugar, tariff will go down to five percent. Sugar in this country has been static for so many years,” he said.

Pangilinan is looking at several crops that have industrial competence like palm oil.

“We are still looking at what crops we can be competitive in. For example, our coconut indus- try is one of the largest in the world but we also hear about demand in palm oil. The impact in this country is great if we pay attention to agri- culture,” he said.

The country’s rice industry, while plagued with supply and pricing issues, could become competitive through the use of advanced rice farming technologies and high-yielding seeds, said Henry Lim Bon Lions, chairman of hybrid rice seeds producer SL Agritech Corp.

This, Lim said, would close the supply and demand gap of at least one million metric tons per year.

“The farmers, while they may be poor and some of them illiterate, are very sharp businessmen,” said Lim.

“The use of hybrid rice can enable farm- ers to produce three times more than using ordinary seeds. Resistance to change is normal. It is very difficult for one to change from the use of ordinary seeds to hybrid. But this can be done through education.”