Importation is Slowly Killing Vegetable Farmers

A vegetable farmer from Guinzadan, Bauko, Mountain Province, arrived with his 100 kilos of cabbage at the La Trinidad Trading Post, where vegetable farmers in the Cordillera bring their produce to sell. The Cordillera region is known as the vegetable granary of the Philippines, producing 70% of the country’s vegetables. The farmer canvassed all the buyers but none would offer him more than a peso for every kilo. He finally accepted the price, gave the P1,000 pesos he was paid with to the truck owner who transported his produce, and went to the house of a kinsman who lived nearby to borrow P600 pesos.  He would use it to pay the agricultural workers who helped him harvest and haul his crop. 

BY LULU GIMENEZ
Bulatlat.com

“I won’t be able to pay for the seeds, fertilizers, and pesticides I got on loan for growing that crop.  The dealer will have to wait for the payment until my next harvest.  But he will have to loan me more inputs first, if I am to grow a crop at all,” said the farmer woefully.

This took place in October 2002.  By the end of the year, the mountain trail from La Trinidad to Bauko was lined with mounds of rotting vegetables.  The garbage dump at the Trading Post stank like a sauerkraut cannery.  The farmers in Benguet and the western Mountain Province were hardly able to sell their produce. 

“We had no Christmas that year,” recalls a vegetable farmer from Mankayan, Benguet.  And it looks like they would have none again this year.

The current price of cabbage at the Trading Post is down again to P1.50 per kilo.  It had risen a while to P4, P7 and even P10 per kilo at the height of the Severe Acute Respiratory Syndrome (SARS) crisis when the volume of agricultural imports from China had fallen sharply.  But now, the price has again dropped down to an extremely low level, threatening Cordillera’s vegetable industry.

Vegetable importation

Figures from the Bureau of Agricultural Statistics (BAS) reveal that nearly a million kilos of fresh “Baguio vegetables” are brought into the Philippine market from other countries – mainly China, the U.S., Australia, New Zealand, and the Netherlands. The figures, however, do not include potato, which the Philippines has been importing in significant volumes despite the fact that it is locally grown in amounts more than sufficient to meet domestic demand. 

BAS figures also reveal that in 2001, nearly 48 million kilos of dried legumes were also imported from the aforementioned countries plus Myanmar, Thailand, Indonesia, and others. 

Dried legumes, such as kidney beans and mongo, are the only cash crops of peasants predominantly engaged in subsistence production in the more remote villages of the Cordillera.  After 2001, the wholesale buying prices for these cash crops declined, at first steadily then sharply, so that they are now less than half their 2000 levels. 

More than 5,500 peasant households in the Cordillera rely on the production and sale of dried legumes for their cash.  Some 8,000 or so grow “Baguio vegetables” as cash crops in otherwise subsistence-oriented economies.  More than 71,000 households, meanwhile, derive their wherewithal almost exclusively from the production and sale of these vegetables.  The liberalized entry of vegetable imports into the Philippine market thus affects a total of about 84,500 peasant households in the Cordillera.

From 2001 to 2002, many of these households were forced to either shift back to producing only for their subsistence or to get out of agriculture altogether.  At the start of this year, the BAS in the Cordillera Administrative Region reported figures that showed a severe decline in the Cordillera’s production of major vegetable crops that had to compete with large-volume imports. 

The production of cabbage fell by 51.5%, potato by 48.4%, carrot by 47.7%, and tomato by 34.5%.  Bean production fell by nearly 47%, and mongo by more than 64%.

CORDILLERA PRODUCTION OF MAJOR VEGETABLE CROPS

COMPETING WITH LARGE-VOLUME IMPORTS

YEARS 2001 AND 2002

Source: Bureau of Agricultural Statistics, Cordillera Administrative Region

The steep drop in production should have resulted in enough lowering of supply to induce a rise in prices – if the only sources of supply had been domestic.  This would have been especially true of cabbage, potato, and carrot inasmuch as the Cordillera accounted for about 70% of the country’s production of these vegetables.  But a deluge of imports, all priced very cheaply, has kept prices depressed. 

If this continues, more vegetable farmers will be delivered into bankruptcy and forced out of production by the policies that have opened up our country’s agricultural market to cheap foreign produce.  Filipinos will increasingly have to depend on imports for an important component of their nutrition. 

WTO and food insecurity

The same policies have already been responsible for shutting down hundreds of rice farming operations throughout the country and paving the way for crop or land-use conversion.  Yet, the danger this poses to domestic production of no less than the country’s staple food does not seem to have bothered government leaders. 

The current administration, as well as several legislators, still advocate continued membership in the World Trade Organization (WTO) and compliance with WTO agreements on trade liberalization. 

The WTO Committee on Agriculture has promised to use the Fifth Ministerial meeting of the WTO in Cancun, Mexico to address the problem of food insecurity that liberalized trade in agricultural produce has brought to poor countries like the Philippines. 

Yet one proposal it has drafted for the new Cancun agreements regarding agriculture will further reduce protection for the domestic produce of poor, developing countries because it will slash remaining import tariffs. 

The Philippine tariffs on vegetable imports are already small to begin with: for cabbage, it stands at only 30% of import value; for potato, it stands at 10%.  If the new tariff reduction scheme that is adopted, import tariffs ranging from 20% to 120% will have to be reduced by 33%; our cabbage tariff will fall under this category.  Import tariffs of 20% and below will have to be reduced by 27%, and our potato tariff will fall under this category.

The WTO Committee on Agriculture is also evasive on the issue of subsidy.  Yet it is discrepancies in subsidy levels that lies at the heart of the problem faced by farmers in poor, developing countries with regard competition from imports. 

The reason why agricultural imports from the China, the U.S., and the European Union are cheap is because farming in these countries is heavily subsidized by the state.  The U.S. and the EU combined spend almost one billion dollars a day on agricultural subsidies.  The new U.S. Farm Bill of 2002 will allow additional subsidization of corporate agriculture to the tune of 180 billion dollars, spread out over ten years.

All WTO members are supposed to reduce their subsidization of agriculture.  Yet the U.S., which spearheaded the creation of the WTO, as well as its adoption of an Agreement on Agriculture, is increasing its subsidies. 

Meanwhile, the governments of poor, developing countries like ours are hardly able to provide any subsidy to agriculture. 

In the field of agriculture, China, the U.S., and the EU are overproducers.  The U.S. and the EU have been taking advantage of agricultural liberalization under the WTO to dump their surplus produce on countries like the Philippines.  At the same time, they have been trying to cut production by offering incentives to agricultural producers who refrain from producing. 

In the U.S. and the EU, farmers can get paid for allowing their land to lie idle so that less produce is introduced to the market.  In the Philippines, farmers who opt out of production go hungry.  Benguet and Mountain Province peasants who rely solely on vegetable production for their survival lose their access to rice and sources of protein.

A small merchant who sells rice, dried fish, canned goods, sugar, and salt to Mankayan vegetable farmers says, “You think [vegetable] importation affects only you farmers?  Two years ago, I would net a thousand pesos a day from selling you food.  Now, I’d be fortunate to net a hundred pesos.”

On Kilometer 90 along the Mountain Trail, each meat seller used to butcher six to 10 hogs a day for his or her pork-buying clientele among the farmers of Buguias, Benguet.  Today, a meat seller would be fortunate to dispose of the pork from even just one hog over a period of two days. Bulatlat.com

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