The “bidding wars” for live hogs among traders, which was recently revealed by the Pork Producers Federation of the Philippines to BusinessMirror, is a clear indication that the country is sorely lacking in one of its favorite sources of protein (See, “ASF prompts PHL to mull over hike in MAV allocation for pork,” in the BusinessMirror, January 18, 2021). African swine fever (ASF), the fatal hog disease that started spreading and wreaking havoc on Asia’s pork sector in 2018, has reached the country’s shores in 2019 and is gradually decimating local hog farms. The supply shortfall has been putting pressure on prices such that the current farm-gate prices—or the cost of live hogs—are now at par with the retail price of pork sold in wet markets a year ago.
The jump in pork prices is adversely affecting consumers who have to switch to cheaper sources of protein, like chicken, or resort to eating more canned goods or processed meat. Unfortunately, food businesses are also affected, particularly those that source their meat products from local traders. While businesses would initially try to absorb the increase in cost, they would eventually have to pass it on to consumers. Pork is not the only meat product affected because the shift to other protein sources like chicken and beef could also pull up the prices of these products. If prices continue to spike, consumers would suffer. Those who can’t afford meat products would have no choice but to stop buying, or look for other protein sources.
Based on projections made by the United States Department of Agriculture, the worst is not over for the Philippine hog sector. The USDA had projected that pork output may fall by 3.6 percent to 1.075 million metric tons this year, the lowest in 20 years. Hog output is not going to rebound any time soon, according to the USDA, because ASF would continue to disrupt domestic production. This means that the Philippines would have less domestic pork supply and would have to turn to the international market so that prices won’t spiral out of control.
Apart from studying the possibility of importing pork, the government should take stock of its ASF control and prevention program to determine where it can make improvements. A thorough examination of programs and measures put in place must be done to determine if these have been effective in stopping the spread of hog disease in high-risk areas. This assessment must be conducted together with industry stakeholders, as their input and cooperation are necessary to ensure the success of any government program.
To its credit, the government has been successful in containing avian influenza outbreaks in Luzon (See, “DA reports major gains to resolve bird flu outbreaks in Pampanga, Rizal,” in the BusinessMirror, January 15, 2021). We can also stop ASF on its tracks if government would be willing to provide the sector the required attention and the resources. The Philippines can take a cue from China, the world’s top hog producer, which was able to revive its hog sector by providing policy support and incentives.