Dry spell impacts on poverty; cost to rice up to P1B

By Amy R. Remo
Last updated 05:39am (Mla time) 08/09/2007

MANILA, Philippines — Damage to rice from the dry spell may amount to between P600 million and P1.14 billion or about 200,000 to 400,000 metric tons, Agriculture Secretary Arthur C. Yap said Wednesday.


“The damage refers to the costs of planting rice and may still change depending on how the weather turns out,” Yap said.


He assured the public that rice supply remained stable.


“The supply needed for 2007 is in place. What we’re trying to assure is the supply of rice for 2008, which we are now augmenting through the quick-turnaround [planting] program,” he said.


He said that by this month, the National Food Authority would have around 800,000 metric tons of rice in its warehouses.


More than 127,000 hectares of farmland have withered in the northern third of the country after lower-than-normal rainfall in June and July, the Office of Civil Defense said.


Fishponds, too


Also devastated were some 41,000 hectares of fishponds.


Worst hit by the dry spell were the regions of Ilocos, Central Luzon and Southern Tagalog, Bicol and Cagayan Valley.


Besides destroying crops, the dry spell is hampering power generation, causing price increases that have hit the poor.


The weather bureau Philippine Atmospheric, Geophysical and Astronomical Services Administration (PAGASA) has warned that the low rainfall risks developing into drought conditions if the dry spell persists into next month.


“Given that there are so many farmers affected by drought, the effect on poverty could be substantial,” said Sheila Encabo, a senior official at the National Economic and Development Authority (NEDA).


Agriculture accounts for just under a fifth of domestic economic output but it employs some 19 million Filipinos, or about 35 percent of the labor force.


Farmhands form a large part of the 40 percent of the population that lives on P90.36 a day or less.


Dennis Arroyo, NEDA deputy director, said the government’s 6.1-percent economic growth target for 2007 remained in place, but warned a drought could cause food price inflation and worsen poverty.


Consumer prices


For the government as well as economists, the other emerging threat is the revival of inflation. Consumer prices rose at a higher than expected clip of 2.6 percent in July as the dry spell pushed up the cost of food.


Bangko Sentral ng Pilipinas Governor Amando Tetangco said the seven-month inflation figure was still within its 2.6-3.1 percent full-year forecast.


“This continues to support our view of a manageable inflation environment. Nonetheless, we are mindful of the risks to this view, which include volatility in oil prices, possible weather disturbances, increases in wages and transport fares,” Tetangco said.


“If the [dry spell] continues, there will be pressure to push up prices,” warned Jonathan Ravelas, an economist at Banco de Oro.


Power generation has also been hit by falling water levels. Metro Manila suffered power outages last month with hydroelectric plants grinding to a halt as rivers dried up.


Utility companies are now planning to further cut water supplies to the metropolis starting Aug. 15, and the Air Force has been cloud-seeding to try to bring on rain.


The Department of Agriculture said corn production in the first half of the year was below target.


Production targets


Yap said the effects of the dry spell meant it would now be difficult to achieve the country’s production growth aims.


But he said the losses could be made up for in other areas, noting that the central and southern islands, where coconuts, bananas and pineapple are farmed, had normal rainfall.


The agriculture department is carrying out a quick turnaround planting program to further boost yields in production areas not affected by the dry spell and thus, make up for the estimated shortfall.


Yap said the agriculture department would need about P150 million for this program.


Earlier, Yap said the dry spell had not reached a critical level.


The last dry spell in the Philippines affected 68 percent of the country and cut agricultural output by 6.6 percent in 1998, when rice yields plunged 43.6 percent and corn 26.6 percent.


Backs emergency powers


Yap said he would back controversial proposals to give President Gloria Macapagal-Arroyo emergency powers to deal with the drought.


Such powers would allow her to get relief projects off the ground quickly, bypassing the government’s supply procurement rules and other red tape. With a report from Agence France-Presse


Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s

%d bloggers like this: