S7.4 MAIZE VALUE/SUPPLY CHAIN AND POST HARVEST MANAGEMENT IN THE PHILIPPINES

MAIZE VALUE/SUPPLY CHAIN AND POST
HARVEST MANAGEMENT IN THE PHILIPPINES
Artemio M. Salazar, IPB, UPLBCA
11th ARMW, Nanning, China November 6-11, 2011
• From the Perspective of a Biologist, not an
economist.
• Will dwell more on the process than economic
parameters (supply vs value)
• Clearer understanding of Philippine maize
industry could only be made if we separate the
yellow from the white – the flint type.

Agriculture Supply Chain in
the Philippines

Agrikulturang Pinoy or Agri-Pinoy

 Set of principles and practices focused on developing Philippine resources
and capabilities to meet Philippine needs

 Four guiding principles of Agri-Pinoy:
o Food Security and Self-sufficiency
o The “Farm” represents interventions in production; from soil
- Sustainable agriculture and fisheries
and water management, extension, seeds and fertilizers, post-
o Natural resource management
o Local development and marketing etc.
harvest processing, credit

- The “Table” represents the DA’s intervention to ensure food
 Key elements of Agri-Pinoy: the consumers
security, safety and quality for
o Broad-based
o Partnership
o Farm to Table
o Sustainable Farming Systems
o Resiliency

SCHEMATIC SUPPLY CHAIN
SEED SUPPLIERS ABATTOIR RESTAURANT
Supply Chain Definitions
BREEDERS
RESEARCHERS
CANNERY HOTELS
MILL SUPERMARKETS
PROPAGATORS ETC ETC
DEALERS
The network of organizations that are involved, through upstream and
Agribusiness linkages, in the different processes and activities that produce
downstream
value in the form of products and services in the hands of the ultimate
consumer. total of all operations involved in the manufacture and distribution
The sum
INPUT
of farm supplies;GROWERS
SUPPLIERS
PROCESSORS DISTRIBUTORS RETAILERS CONSUMERS
production activities in the farm; and the storage, processing,
and distributionof connected and interdependent organizations mutually and
 A network of farm commodities and items derived from them
co-operatively working together to control, manage and improve the flow of
materials and information from suppliers to end-users.
WHOLESALER YOU
FARMER
IMPORTER YOUR FAMILY
GROWER
EXPORTER FRIENDS
FISHERS
TRANSPORT &
PASTORALIST
PROVIDERS ME

YELLOW MAIZE SUPPLY CHAIN
SEEDS POST HARVEST
FERTILIZERS FACILITY PRODUCTION FARMS
MECHANIZATION

INPUT TRADERS/ BIG TRADERS
FARMERS CONSUMERS
SUPPLIERS PROCESSORS DISTRIBUTORS

WHOLESALER
IMPORTER DIRECT AND
FARMER EXPORTER ULTIMATE-
TRANSPORT
PROVIDERS

FARMERS CONSUMERS

• Let us start with the end part of the chain as
this will largely determine the early parts of
the chain
• Yellow maize is mainly for feeds

FARMERS CONSUMERS

Feed Yellow
Wheat Corn

National requirement of yellow corn for meat outstrips local production
necessitating importation, mainly feed wheat

FARMERS CONSUMERS

The ADDRESSING THE LOGISTICS CONCERN
Logistics
Concern

Excess corn production from Mindanao and Cagayan Valley used to be shipped to
greatest concentration of feedmills in Luzon & Visayas. The government had instead
intensified production in Luzon due to high transport cost from Mindanao

FARMERS CONSUMERS

The Future:
• The demand for meat and consequently, yellow maize, will
intensify.
• Uncertainty of supply of yellow maize in the world market
due to the use of the grain for ethanol by the world’s
biggest maize supplier, USA
• The supply and price of feedwheat could not be relied
upon because of the climate change (East Europe and
Australia)
• The regional trade association where Philippines is
member of would bring down tariff barriers to traded
goods as early as 2015. The entry of cheap meat from the
outside would significantly depress the local livestock and
yellow maize industries.

FARMERS CONSUMERS

The Future:
• There is a pressing need to be self sufficient for
this grain!

FARMERS CONSUMERS

The Critical Post Harvest Phase

Philippines receives on average 2,061 mm (81.1 in) of precipitation annually
with most of it from June to October

FARMERS CONSUMERS

Number of Tropical Cyclones by Category in the Philippine Area of
Responsibility, 948 to 2007 Source: PAGASAwww.typhoon2000.com

The harvest of the main cropping season is
almost always wet.

FARMERS CONSUMERS

AVERAGE MONTHLY DISTRIBUTION OF YELLOW CORN, CY 2001-2003 vs
AVERAGE MONTHLY RAINFALL FOR THE LAST THIRTY YEARS

550 350
500
300
450

Ave. Rainfall (mm)
Production ('000 mt)

400 250
350
200
300
250
150
200
150 100

100
50
50
0 0
Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec

M onths
Rainfall Production

Post harvest is a serious concern during the wet season

FARMERS CONSUMERS

• The high amount of rainfall during the wet season
(May-August) has serious implication to corn quality.
Aflatoxin contamination is common in those areas
with no mechanical dryer. Usually, price of maize goes
down at harvest time during this season.
• The issue of Philippine maize industry is an issue of
grain quality.
• Multi-purpose drying pavements for solar drying have
been provided but they are not enough when harvest
is plenty and rainy period is extended. Big mechanical
dryers are very expensive. One encouraging
development is the investment of the private sector
in this matter.

These are found in Bukidnon- the
biggest maize producing province
in Mindanao. Maize in cobs are
bought from the farmers. The
facility takes care of the drying and
shelling. These guys then sell to
the big feedmillers or use them
themselves.

A bigger one was established in Isabela – the biggest maize producing
province in Luzon. This is accordingly the biggest post harvest facility
in Southeast Asia. Capacity is 200K tons cobs with 60,000 ton capacity
silos. Two more will be established by the company.

FARMERS CONSUMERS

• The effect of such facility was felt at once
during wet season harvest in Isabela. Instead
of going down, the price of maize went up by
30%. There was a 4-km line of trucks waiting
for their corn harvest to be processed.
• The government is doing its part in providing
smaller and therefore less expensive post
harvest facility to small farmer cooperatives

FARMERS CONSUMERS

The Future ?
• This is one area where the country is making
headway. It started with just one company.
Two more are coming in and hopefully more
will participate.
• Expanding processing and storage capacity for
at least one season of harvest will stabilize the
supply and price of yellow maize in the country

FARMERS CONSUMERS

The Production Phase
• Average yield is 3.63 tons/ha (official data) planted in 1.16 M
has. Operational figure is 5 tons/ha to be profitable. About
90% of the area is planted to hybrids. The three big
multinationals are here-Pioneer, Monsanto and Syngenta.
Bioseeds is also getting strong . There are also some locals
• The percentage planted to GMOs - Bt and RR, marketed by
the multinationals, is expanding.
• There is not much concern about GMOs as we are not
exporting corn nor meat
• There is an on-going Site Specific Nutrient Management
Program by the Dept of Agriculture in collaboration with IPNI
• Planting and harvesting are basically manual

FARMERS CONSUMERS

The Production Phase
Challenges:
• Drought tolerance because 95% is rainfed. Freak drought
occurs even during the wet season especially in Luzon
• Abiotic stresses like water logging especially during early dry
season cropping, acidity due to nature of the soil (like in
Bukidnon and portions also of Cagayan Valley)
• Disease resistance because most of the areas are continuously
planted to corn. Condition is generally warm and humid. Need
for close monitoring of disease, insect and rodent outbreaks
• Financing

FARMERS CONSUMERS

The Future?
• More gains in yield and stability are expected with strong
participation of the different seed companies especially the
multinationals
• Stability traits would cover biotic and abiotic stresses
• As in the past, the public sector R&D has not been competing
with the private sector. It keeps updated however in latest
technologies as support to capability building of locals
employed in the different seed companies.

WHITE MAIZE SUPPLY CHAIN
SEEDS POST HARVEST
FERTILIZERS FACILITY
MECHANIZATION

FARMERS CONSUMERS

WHOLESALER
IMPORTER
DIRECT
FARMER EXPORTER
TRANSPORT
PROVIDERS

FARMERS CONSUMERS

• White maize, the flint/denty type, is mainly for food.
• Most of the white corn produced by the marginal
corn farmers are consumed at the household level.
• Some quantity is shipped for food purposes in
identified corn eating areas like Cebu. White maize
there comes from Mindanao, mainly Bukidnon.
• White maize for food is mostly in the South.
• We have been self sufficient in white maize

FARMERS CONSUMERS

• White maize, the flint/denty type, is mainly for food.
• The yield of white maize is 1.16 tons/ha planted in
1.34 M has.
• Most of the white corn produced by the marginal
corn farmers are consumed at the household level.
• Some quantity is shipped for food purposes in
identified corn eating areas like Cebu. White maize
there comes from Mindanao, mainly Bukidnon.
• White maize for food is mostly in the South.
• We have been self sufficient in white maize

CORN: DOMESTIC PRODUCTION, 2001-2010
8.00
7.03
7.00
6.38
6.00
4.51
5.00
Million MT

4.72
4.00 4.21

3.00 2.62
2.32
2.00 2.17
1.89
1.00

-
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Combined White Yellow

Source: BAS AAGR ≈3.85% ≈1.65% ≈5.46%

FARMERS CONSUMERS

• There are very few seed companies working on white maize
hybrid basically because of lack of market. White corn farmers
are usually poor
• Seeds are of the open-pollinated type either native varieties or
open-pollinated cultivars. The farmers , marginal at that, could
not afford to buy hybrid seeds or fertilizers. Various sorts of
biotic and abiotic stresses including low level of inputs.
• Native varieties are mostly early maturing, low yielding,
tolerant to stresses but of good (eating) quality. The public
sector R&D is working more on this.

FARMERS CONSUMERS

The Future
• There is a sizable rural population in the uplands dependent
on maize
• To improve their status, market should be developed to
enhance their productivity
• The government is now considering white corn as part of its
food security plan thru food diversity approach. Rice
importation is only 10% of national requirement which can be
readily provided by white maize. The government is launching
the Corn for Health program based on white QPM. It has
promotional, production and quality assurance components.
• The plan is to provide the different regions with foundation
seeds. They will then produce the registered seeds for
distribution to the provinces and municipalities and finally to
the farmers.

Summary
• Developments in the yellow maize industry
point towards positive growth with greater
private sector participation
• There is far greater challenge in white maize.
The more farmers there need more help.

S7.4 MAIZE VALUE/SUPPLY CHAIN AND POST HARVEST MANAGEMENT IN THE PHILIPPINES

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