LONDON, Dec. 18, 2016 /PRNewswire/ -- Includes 3 FREE quarterly updates
We hold a positive view on the Philippines' agribusiness sector in the long term, given the country's potential for expansion into new sectors, such as palm oil. We particularly like the outlook for sugar mills and believe the livestock sector will continue to show healthy growth rates. The Philippines' vast consumption market along with some government support, will foster domestic and foreign investment and favour output expansion. However, backyard farming and infrastructure problems, especially transport costs, will continue to hamper the sector's growth. These inefficiencies will become increasingly crippling as South East Asia moves towards the ASEAN Economic Community, which is supposed to lead to trade and investment liberalisation across the region. Although the Philippines' government appears to have taken the measure of the challenge and is now supporting rice and sugar production, agriculture in the country remains uncompetitive. As such, the sector is at risk of low-cost imports from its neighbours over the medium term.
- Sugar production growth to 2019/20: 22.7% to 2.7mn tonnes. Sugar production growth will be driven by improvements in yields. The government approved the Sugarcane Industry Development Act, which is aiming at diversifying the sugar sector towards more value-added products and will provide financing to farmers.
- Poultry production growth to 2019/20: 16.3% to 1.3mn tonnes. Poultry production will record steady but unspectacular growth. Growth will be driven by investment, both domestic and foreign.
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