ILLEGAL TRADE OF POTATO: ITS EFFECT ON POTATO SUPPLY AND PRICE IN THE PHILIPPINES

Christine Joy B. Manalo,Julieta A. Delos Reyes,Abigail T. Lat,Jennifer C. Padrid,Tyrone Jasper I. Reodica 한국무역학회 2019 한국무역학회 국제학술대회 Vol.2019 No.08

Due to rising incomes, growing urban population, diversification of diets and lifestyle, there has been an increasing demand for potato from fast food chains and snack and convenience food industries. Meanwhile, potato production is climate- and area-specific, but demand is nationwide and even worldwide. The burgeoning population is steadily increasing the number of mouths to feed such that efforts to address food security continues to fall short of target. Food items as important as white potato should be demand-responsive so that its price will be more stable benefitting the less fortunate members of society. It therefore becomes necessary to determine how responsive is the country’s potato industry to the many goings-on inside and even outside of the country. This study is an effort to address this question by first analyzing the trends in potato production and area planted as well as the volume of imports and those that were smuggled into the country. The findings highlight the fact that the potato industry of the Philippines is still dependent on imports with increased import dependency ratio from 5% in 2014 to 14% in 2015 until 2017. In terms of prices, generally increasing but fluctuating trends in farmgate, wholesale, and retail prices of potato were noted. Wage rate and volume of smuggled potatoes were found significantly but negatively affecting both volume supplied and area planted to potatoes while technology was a significant positive determinant. It concluded that importation of potato is helping the fast food chains, snack and convenience food industries since most of the imported potatoes are processed ones. This fact however, has a negative impact to our local farmers especially when illegal trade is present and the trend in importation is increasing. For more than two decades, illegal trade of potatoes has been in existence and volumes are also alarming. The entry of U.S table-stock potatoes also compete with the local production which started in 2014 (Potato Pro, 2013). The following are therefore recommended: a) for the national government to consistently address the rampant illegal trade of agricultural commodities by strictly enforcing the Anti-Agricultural Smuggling Act (Republic Act 10845) b) encouraging formation of cooperatives among the growers in the top producing regions potato seed production and technology development; and c) potato farmers in Mindanao should be encouraged to utilize their potential farm area to maximize potato production.

Fluctuations in Supply and Prices of White Potato and Tomato: Are the Triggers the Same?

Julieta A. Delos Reyes,Christine Joy B. Manalo,Abigail T. Lat 아시아무역학회 2020 Journal of Asia Trade and Business Vol.7 No.2

Purpose – White potato and tomato just like many agricultural products are both highly perishable but agronomically, these two products are quite different with white potatoes less prone to losses because they are sturdier and less susceptible to physical damages. Tomatoes are climacteric and more temperature-sensitive depending on the stage of maturity. Both however, are internationally-traded and were reported to be among those that are frequently smuggled into the Philippines. The paper is anchored on the major hypothesis that smuggling together with other factors can trigger the changes in supply and prices of the two commodities but the magnitudes of such effects differ for each commodity due mainly to their inherent characteristics. Design/Methodology/Approach – Monthly price series data covering the period 1990, for white potato, and 1993 for tomato, up to 2017 were subjected to price analysis using the multiplicative model of the ratio-to-moving average method focusing on seasonal and irregular price variations. The double logarithmic form was identified as the most appropriate model for the multiple regression analysis. Findings – Results revealed that the white potato industry is more dependent on imports than tomato. Tomato production is generally increasing but area planted has been decreasing. Both the white potato and tomato industries are vulnerable to price instability brought by natural phenomenon and calamities. Technology and smuggling were the only factors commonly affecting the production responses of the two commodities with technology being a production booster, but technical smuggling reduces the quantity produced of both commodities. The magnitude of the effect of these two variables was greater in white potato than in tomato. Wage rate is also a negative factor for white potato production while tomato production negatively responded to palay (paddy rice prior to husking) farmgate price but benefits from the government-imposed tariff on imported tomatoes. Research Implications – Study results imply the need for stricter and more diligent implementation of Anti-Agricultural Smuggling Act (Republic Act 10845) and for policymakers to consider the nature of agricultural products in crafting policies in view of the fact that there are more vulnerable commodities vis-à-vis technological changes, incidences of smuggling and wage rate hikes that affect their quantity supplied in the market.

PROFITABILITY ANALYSIS OF SMALL AND MEDIUM SCALE SALT ENTERPRISES IN MISAMIS ORIENTAL, PHILIPPINES

Tyrone Jasper I. Reodica,Julieta A. Delos Reyes,Abigail T. Lat,Christine Joy B. Manalo,Jennifer C. Padrid 한국무역학회 2019 한국무역학회 국제학술대회 Vol.2019 No.08

The study analyzed the profitability of small and medium scale salt enterprises in Alubijid and El Salvador City, Misamis Oriental, Philippines. It identified the salt producers; determined their production practices; assessed the profitability of salt production; and identified the problems encountered by the salt producers. A total of 42 salt producers were personally interviewed using a pre-tested interview schedule. All the salt producers in the two areas were included in the study. They were producing salt through solar evaporation method. Descriptive analysis, cost and returns analysis, rate of return on investment (ROI) analysis and ANOVA were used to analyze the collected data. Results revealed that the production practices of the salt producers are mainly dictated by the flooring materials of salt beds. The salt producers in Alubijid used black polyethylene plastic and brick tiles, while those in El Salvador City used transparent polyethylene plastic. The type and volume of salt produced by the salt producers were highly dependent on the flooring materials as well as on the weather conditions which require large amount of sunlight. It was concluded that salt production is a profitable enterprise and also a good source of livelihood among the members of the lakeshore community. The salt beds with transparent polyethylene plastic as flooring material were proven to be the most profitable, however, the most labor-intensive production process. It is therefore highly recommended that the salt producers be encouraged to use the transparent polyethylene plastic as flooring material and be taught the appropriate technology for seawater filtration which will address the problem on the degraded quality of seawater. The local government unit (LGU) should take the lead in this endeavor. Also, it is suggested that a soft loan program be put up by the LGU for the purchase of flooring materials so that more members of the lakeshore community can be encouraged to engage in the salt making business.