By The Financial District
Apr 72 min
The Department of Agriculture (DA) is advocating for the construction of deep piers designed to accommodate large ships, aiming to reduce the logistical costs of farm inputs, particularly fertilizers.
Having deep piers, also known as panamax piers, will allow large ships to dock directly, significantly reducing transportation costs. I Photo: Shimizu Corporation
This initiative is expected to ultimately decrease the production cost of rice in the Philippines.
Assistant Secretary Arnel de Mesa emphasized the country's aspiration to enhance competitiveness in rice production compared to its Southeast Asian counterparts. To achieve this goal, the DA is committed to lowering the logistics expenses associated with farm inputs.
During a news forum in Quezon City, De Mesa highlighted that while Vietnam produces rice at a cost of P6 per kilogram, the Philippines incurs a production cost ranging from P12 to P14 per kilogram.
Labor constitutes a significant portion of rice production costs, and labor expenses are notably higher in the Philippines. To address this concern, the Rice Tariffication Law was enacted, allocating P10 billion annually under the Rice Competitiveness Enhancement Fund (RCEF).
Half of the RCEF budget, amounting to P5 billion, is allocated for farm mechanization, aimed at reducing labor costs in rice production. De Mesa underscored the importance of addressing input costs, particularly logistics expenses associated with transporting fertilizers from distant locations.
He explained that having deep piers, also known as panamax piers, will allow large ships to dock directly, significantly reducing transportation costs.
With improved logistics, the prices of inputs could immediately decrease by about P15 to P20 per kilogram.
Furthermore, De Mesa mentioned the DA's focus on enhancing the distribution system and post-harvest facilities to enhance the competitiveness of the agriculture sector. The agency aims to achieve higher rice productivity, considering that the current national average is only 4.1 metric tons per hectare.
While Nueva Ecija, the country's rice granary, achieves six to eight metric tons per hectare, many areas in the Philippines produce three to four metric tons per hectare due to limited access to high-yielding varieties, irrigation, and fertilizers, primarily because of high input costs.