Philippines unveils support for coffee industry

Wednesday, March 9, 2011

THE Philippine government unveiled Wednesday some of its plans to strengthen the coffee industry which has failed to supply the country's growing demand in years.

At the 1st Philippine Coffee Investors Forum in Makati City, the Department of Agriculture said it is coordinating with concerned agencies to help Filipino coffee growers back on their feet.

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These include tax incentives, financing schemes, technical training, and interventions to prospective investors and producers.

The forum also linked possible investors with coffee industry stakeholders and hosted discussions on coffee farming that included information on available financial and technical support.

Set to be frontloaded this year are roughly one million pieces of planting materials, 232 pieces of small farm equipment and 20 units of production facilities such as screen houses and post-harvest facilities.

For their part, state lender Land Bank of the Philippines and Sy-led Banco de Oro Unibank, Inc. presented their loan packages to interested parties. However, details of these loans depend on the applicant's cash flow, business plans, and fulfillment of required documents.

In the global trade, coffee ranks first among non-staple food and is rated as fifth most important agricultural product. It is also considered as one of the high-value commercial crops in the local and foreign markets.

Local coffee production has been declining in the past two decades as demand reached 64,000 metric tons worth P2.5 billion this year.

Industry leaders believed that conversion of coffee areas to housing subdivisions and golf courses in some parts of Luzon, and shift of farmers to other high-value crops such as pineapple contributed to the negative growth.

With this, top producers Indonesia and Vietnam will possibly corner 26,600 MT of Philippine demand in 2011. Importation cost is estimated at P3 billion a year, government records show.

"Both the public and private sector have to shell out between P2 and P4 billion to finance the country's self-sufficiency aim over the next five years," Dante Delima, program director of the department's High Value Crops Development said.

Among the positive characteristics of coffee is its suitability to the country's tropical climate, harvest time within two years, non-perishable crop, high pest/disease tolerance, among others.

"Coffee growing is proving to be a profitable business venture because there is a ready market in the Philippines and abroad," Agriculture Secretary Proceso Alcala said.

Most of the country's coffee plantations are concentrated in the provinces of Benguet, Batangas, Cavite, Kalinga, Apayao, and Davao. (Virgil Lopez/Sunnex)