Entrepreneurial Farmer

Ambrosio R. Villorente

DA Expects Hike In Rubber Production

The Department of Agriculture (DA) expects domestic rubber production to increase this year. This is the result of its stepped-up efforts to make the Philippines a major player in the global market for this high-value commercial crop (HVCC).

DA Secretary Arthur Yap said that the Philippine rubber industry has to deal with a myriad of concerns such as high production cost and the lack of access to affordable credit and loans to small growers in order to increase its production to a level that would significantly reduce imports of the commodity in the medium term.

Natural rubber production is still considered an emerging industry in the Philippines, even though it started growing trees at around the same time as Thailand, Indonesia, and Malaysia, which collectively account for around three-fourths of the entire world’s natural rubber output.

Global demand for natural and synthetic rubber shrank by three (3) percent in 2008, based on calculations by the International Rubber Study Group.

"Nonetheless, we remain very optimistic about meeting our full year target of 440,600 metric tons, as we continuously strive to fulfill the requirements of the tire and footwear industries amid some signs of recovery in the global rubber market," Yap declared during a recent gathering of rubber industry stakeholders in Zamboanga Sibugay.

Yap noted that on top of market forces, the domestic rubber industry should, among other steps, embark on a massive replanting program to replace senile trees to earn more from the lucrative rubber markets.

The domestic rubber industry should also overcome the challenge of being burdened with security and peace and order issues, as most rubber plantations are located in Mindanao, making them "unattractive to investors," advised Yap in a speech that was read for him by assistant secretary for agribusiness and marketing Salvador Salacup.

The other major concerns that the rubber sector must immediately address, according to Yap are: high production expenditures due to the rising cost of labor, fertilizers, chemicals and other inputs; insufficient access to affordable credit and loans; and the need to put in place a stronger national research, development and extension system to make the industry globally competitive.

At least 190,000 Filipinos directly and indirectly depend on the rubber industry as their source of livelihood, with 38,000 families into rubber farming, 18,000 working as part-time off-farmers and another 20,000 being employed as tappers.

About 700 buyers and traders and an estimated 600 processors and workers are employed in the country’s 30 existing rubber processing centers.

In 2008, the Philippines exported 25 million kilos of latex, rubber plates and other rubber products worth US$40.5 million. They were shipped mostly to China, Hong Kong, Taiwan, and Malaysia.

Last year, national rubber production expanded by 1.72 percent to 411,000 metric tons, from 404,070 metric tons in 2007.

However, the total value of production dropped more than seven (7) percent from P17.26 billion in 2007 to P16.03 billion in 2008—owing to the lower prices triggered by weak demand worldwide for rubber products brought about by the global financial crisis.

This downward trend continued into the first six months of 2009, which saw harvests slightly declining by 0.15 percent to 69,730 metric tons, valued at P4.3 billion, from 169,980 metric tons during the same period last year.

"While the Philippines lags behind her Asian counterparts, she wants to be a major player in the coming years, with Western Mindanao leading because it is home to nearly half of the country’s 123,300 hectares of rubber farms."

The government has embarked on a 10-year National Rubber Develop-ment Program (NRDP) starting 2006. The program is geared towards enhancing the productivity and competitiveness of the industry—in partnership with the industry players, local and foreign investors, local governments, and farmers’ groups. /MP