Feed millers raise concern over declining local corn production

The Philippine Association of Feed Millers Inc. (PAFMI) has raised concern over insufficient local corn production and is urging the government and local producers to address the urgent need to ensure reliability and consistency of supply in the country.

Photo by Balázs Benjamin from Pexels

Corn is a key input to various industries, including feed manufacturing, food processing and biofuel production.

Animal feed producers are the biggest users of corn, particularly of yellow corn. However, the local supply of yellow corn in the past several years had been falling 48 percent short of feed producers' requirements.

PAFMI believes that a reliable and consistent corn supply will be crucial in boosting local production, not only for animal feeds, but also for food, food processing (into snack food, corn flour, cooking oil and others), and biofuel production.

"This can be achieved by coming up and immediately implementing an inclusive, comprehensive, and sustainable corn industry development program," PAFMI said.

Already, the group is pushing for the adoption of a value chain approach in the preparation of such policy and program. This means the program should not be limited to corn production concerns, but should also cover other aspects affecting the entire industry, such as post harvest facilities, credit, warehousing, marketing, transport, other logistics concerns, among others.

"PAFMI vows to support all measures needed to improve the country's corn supply sufficiency, reliability and consistency given the strategic role corn plays in ensuring the country's food security and in keeping vibrant economic activity," PAFMI said.

Yellow corn, a source of energy for animals, makes up 40 to 60 percent of animal feeds. These, in turn, account for 60 to 70 percent of the cost of producing meat and poultry products. Thus, supply and prices of yellow corn significantly affect end-consumers of meat, poultry products, and fish.

For instance, PAFMI said, a P1-increase in the price of feed corn per kilo translates to a 3 percent rise in the cost of producing a kilo of broiler feeds which, in turn, could result in a 1 percent rise in the cost of growing a broiler chicken.

This, while a 3 percent increase in the cost to produce a kilo of layer feeds will jack up by 2 percent the cost of producing an egg. A 2 percent increase in the cost of producing a kilo of hog feeds will increase by 2 percent the cost of growing a hog. All these consequently result in higher prices of pork, chicken, and eggs.