Industry Trend Analysis - Growing Meat Imports In Sight For The Philippines - FEB 2015

BMI View: The Philippines will see its production deficit for meat products widen in the coming years . We forecast the country to record steady but unspectacular production growth, while consumption will remain robust. The poultry sector will outperform pork and beef, as investment pours into the segment. M eat imports will rise steadily in the medium term, as elevated production costs make the sector uncompetitive compared with other low-cost suppliers.

The livestock sector in the Philippines will continue to be characterised by dynamic consumption growth and lacklustre production expansion. The country's poultry production will record steady but unspectacular growth compared with its South East Asian counterparts. We forecast poultry output in the Philippines to grow by 14.1% between 2013/14 and 2018/19, to 976,000 tonnes, compared with 30.2% growth over the same period in Thailand, to 2.03mn tonnes, and 25.1% growth, to 1.03mn tonnes, in Vietnam. Poultry production in the Philippines will outperform the other sectors, as it will attract the majority of investment in the coming years, both domestic and foreign.

Livestock production growth in the Philippines will be constrained by the elevated cost of production and an inefficient marketing system. Meat production will remain less competitive than in large, low-cost suppliers and will therefore be vulnerable to cheaper imports amidst the ongoing liberalisation of trade, especially in South East Asia. In particular, the country's poultry sector is less competitive than those in Brazil and Thailand, two large producers and exporters of broiler meat. Indeed, the sector is held back by the lack of domestic feed ingredient, higher input costs, below-par on-farm productivity and an inefficient marketing system.

Unstoppable Growth
Philippines - Select Meat Net Imports ('000 tonnes)

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