Bright prospects ahead for Philippines dairy industry

MANILA, Philippines — The Philippine dairy industry is projected to bounce back this year, with brighter prospects next year on higher yields from dairy animals and increased investments from the private sector.

In an interview with The STAR, National Dairy Authority  administrator Farrell Benjelix Magtoto said the country’s milk production has already reached 30 million liters compared with last year’s 26.3 million liters.

Domestic dairy output declined by 1.5 percent to 26.3 million liters last year from 26.71 million liters in 2020, NDA data showed.

“The good news we have for 2022 is we finally hit the 30-million-liter target. Last year it was 26 million liters, now it’s 30 million liters. Positively, by Dec. 31, we’re going to hit about 31 million liters,” Magtoto said.

This is higher than the projection of the United States Department of Agriculture (USDA)-Foreign Agricultural Service (FAS), which projected a three percent increase in the country’s dairy output to 26,800 metric tons (MT).

Despite the limited number of animals, they produced more dairy this year.

“The number of dairy animals is very limited, we even have less than 70,000, that is including everything – goat, cattle, buffalo. The number of our milking cows is also limited,” Magtoto said.

“But the cows’ productivity increased. From eight liters per animal, we are now averaging 9.5 to 10 liters. So, that’s a significant number,” he said.

Apart from higher yields, the Philippine dairy sector also saw more investments in mega farms.

“There are more private individuals who are now investing in dairy, adding 100 heads, 200 heads,” the NDA official said.

Just last week, Metro Pacific Agro Ventures Inc. (MPAV), the wholly owned agriculture unit of Metro Pacific Investments Corp. (MPIC), and its partner Israeli firm LR Group Ltd. launched Metro Pacific Dairy Farms (MPDF), a farm facility which can produce 6.5 million liters of milk annually.

This project will further expand MPAV’s existing dairy business, The Laguna Creamery Inc., of which MPIC bought 51 percent from Carmen’s Best Group for P198 million in June.

From 90 to 100 milking cows, the new farm facility will have a capacity of up to 2,000 cows, initially having 1,000 cows of which 600 will be milking cows.

Through modern farm practices, MPDF plans to increase the country’s fresh milk yield per cow, from eight to 10 liters a day to 30 liters a day.

The construction of the facility will start in 2023 and take approximately two years to finish, while commercial operations are projected to commence by late 2025 to early 2026.

“With the onboarding of Metro Pacific, it will also create a bandwagon for other investors. That’s what’s lacking in the sector,” Magtoto said.

With more mega farms being put up, the country will see better yields and quality in the dairy sector.

“The thing with mega farms is these are professional farmers. Before it was only conventional grazing. Now this is scientific. All the cow comfort, all the nutritional needs, all the necessary requirements to produce better yield will be there. Each cow can be monitored,” Magtoto said.

The NDA will also see higher budget next year to implement the government’s dairy development projects geared towards increasing milk production, the NDA official said.

But even with better prospects for the local dairy sector, the Philippines will remain heavily dependent on imported milk.

“Right now, we cannot beat importation, which is three billion liters of milk, whereas we are only producing 30 million liters of milk. Currently, we cannot beat importation with quantity but I am seeking everyone’s contribution and collaboration to help NDA beat importation through quality. Our 30-million-liter good quality production will find its best market,” Magtoto said.

The Philippines imported 2.98 billion liters of milk last year,  supplying 99 percent of the country’s total requirements. The number is lightly higher than the 2.9 billion liters imported in 2020