Secretary Proceso J. Alcala 25 August 2015

A presentation for the members of the House of Representatives-Committee on Appropriations

FY 2016 Plan and Budget Proposal Department of Agriculture’s

Outline

①  Our Key Achievements: Performance Highlights under the Aquino Administration

②  Our Goal, Thrusts and Priorities: Key Sector Commitments until 2016

③  Our 2016 Budget: FY 2016 DA Budget based on the National Expenditure Program

④  Our Legislative Agenda: Priority Bills for the 16th Congress

Our Key Achievements

Historical Best in Rice and Corn Production

Recorded fastest production growth among the world’s rice producers for 2010-2014

Increased Growth and Productivity

Rank Country Ave. Growth

1 Philippines 4.02% 3 India 2.97%

5 Vietnam 2.35%

11 China 1.14%

14 Thailand -1.47%

World Ave. 1.39% Data Source: USDA World Markets and Trade, Aug 2015

Rice Production Growth, 2010-2014

Achieved historical best of 18.97 MMT palay production and 4.0 mt/ha yield in 2014

Achieved historical best in corn production 2010 2014

6.38 MMT

2.38 mt/ha

7.77 MMT 3.01 mt/ha

Volume of Production

Yield Level

7.5 %

Average annual growth rates of net returns (2009-2013):

10.2 %

Particulars 2009 2013 Ave Growth

Net Returns (PhP/hectare/cropping) 12,608 16,833 7.5%

Net Profit Cost Ratio 0.33 0.40 4.9% Source: Costs and Returns Survey (CRS) of Palay, March 2011 & January 2015 (PSA-BAS)

Particulars 2009 2013 Ave Growth

Net Returns (PhP/hectare/cropping) 4,748 7,004 10.2%

Net Profit Cost Ratio 0.21 0.32 11.1%

Palay

Corn

Source: Costs and Returns Survey (CRS) of Corn, March 2011 & December 2014 (PSA-BAS)

Increased Profitability in Rice and Corn

Boosted Farm and R&D Investments

41 1,806 no. of units

in 2011

Increased use of combine harvesters

no. of units in 2014

Established small-scale irrigation systems (SSIS) 2,822 ha

service area generated from 2011 to 2014

1.07 B 3.22 B FY 2010 FY 2016 NEP

DA R&D budget (in PhP): Intensified R&D initiatives

Mechanization has reduced average cost

of rice production from P11.07/kg to as

low as P7.78/kg.

Key Achievements

14,150 ha CY 2010

83,945 ha CY 2014

Philippines is the fifth largest producer of organic agriculture products in Asia

Number of farms and practitioners of organic farming increased to 10,000 and 88,000, respectively

Organic agriculture production in 2014 six times the production in 2010 (4,500 MT à 27,000 MT)

Organic products reached 72 domestic and international markets

Intensified Organic Agriculture Development

Curbed illegal, unreported, and unregulated (IUU) fishing

Passage of RA 10654, Amended Philippine Fisheries Code

Improvement of traceability and catch certification schemes

Reinforced RP-Papua New Guinea cooperation for inspection, control and coverage beyond Philippine waters

Implemented measures resulting to EU’s lifting of yellow card on Philippine fishery exports through:

Institutionalized Sustainable Fishery Reforms

Resource Management and Enforcement

Implemented closed seasons to regenerate marine resources

successful closed seasons since 2011 4

Enforcement of closed season was instrumental in the approval of Philippine access to the tuna-rich High Seas Pocket 1 of the Pacific Ocean until 2017

Intensified monitoring and enforcement initiatives

Institutionalized Sustainable Fishery Reforms

4 188 CY 2010 as of March 2015

Number of fishery law enforcers:

580 by end of 2015

PNS developed from 2011 to date 62

Commodities with Philippine National Standards (PNS)/Good Agricultural Practices (GAP) developed in 2011-2015:

Crops

Livestock

Fisheries

Rice, Corn, Cassava, Coffee, Cacao, Banana, Sugar, Snap Beans, Chico, Macopa, Mungbean, Soybeans, Peanut, Onion, Moringa, Avocado, Breadfruit, Dragonfruit, Marang, Soursop, Sugar Apple, Sweet Cassava, Turmeric, Chayote, Guava, Lima Bean, Rambutan, Strawberry, Taro, Winged Beans, Melon, Santol, Luffa, Sweet Tamarind

Halal Ruminants and Poultry  

Mollusc, Fish Fillet, Lobster, Sea Cucumber, Cephalopods, Tuna, Convolvulus, Halal Fisheries Products  

PNS in pipeline 19

Developed Philippine National Standards (PNS)

Free from Animal Diseases

For the 5th year in a row since 2011, certified as Foot and Mouth Disease (FMD) -free without vaccination

Continuously maintained Bird Flu-free status

Recently certified Peste des Petits Ruminants (PPR) free by the World Organization for Animal Health last May 2015

Improved Animal Health and Consumer Welfare

Agri-Pinoy Trading Centers (APTCs) operationalized

•  Nueva Ecija APTC

•  Camarines Norte APTC

•  Quezon Corn Processing and APTC

•  Dalaguete APTC

average of 15% to 25% increase in income is estimated due to reduction of market layer

8  •  Pangasinan APTC •  Isabela Multi-

Commodity APTC •  Nueva Vizcaya

Regional Organic APTC

•  Nueva Vizcaya APTC

Food Terminals Operationalized, 2011-2014:

Municipal Food Terminals 37   Barangay Food Terminals 399  

Improved Domestic Market Access

New Foreign Markets Opened in 2014

Improved Foreign Market Access

Country Export Products Thailand Calamansi and dalandan concentrates Singapore Fruit jams, coco water Kuwait Frozen whole chicken Qatar Frozen whole chicken, marinated chicken

UAE Rice (i.e. Miponica and Jasponica rice brands), fresh and frozen tuna loins, tiger shrimps, avocado, guyabano, mangosteen, rambutan, solo papaya, durian, lakatan, bongolan bananas, sweet yellow corn

Oman Rice (i.e. Miponica and Jasponica rice brands), avocado, guyabano, mangosteen, rambutan, solo papaya, durian, lakatan, bongolan bananas, sweet yellow corn

Japan Durian, yellow dragon fruit, peking duck, chicken Canada Heirloom rice

Invested in climate-resilient infrastructure

3,014 km concreted FMRs from 2011 to 2014

Developed and promoted climate-resilient varieties

Rice

Banana Fusarium wilt-resistant banana varieties, GCTCV 218 and 219

paraoakan , banaba, joloano, camarines, boholano, bolinao, labuyo, darag

Native Chicken

The NextGen Project is a DA-Philrice-IRRI collaboration to develop rice varieties resistant to pests/diseases and tolerant to adverse environments

24 promising varieties developed through the NextGen Project  

Increased Sector Resilience to Climate Change Risk

PhP 85.5 B amount of insurance coverage

from 2011-2014

Increased risk insurance coverage

Invested in climate-resilient infrastructure

3,014 km concreted FMRs from 2011 to 2014

Developed and promoted climate-resilient varieties

Rice

Banana Fusarium wilt-resistant banana varieties, GCTCV 218 and 219

paraoakan , banaba, joloano, camarines, boholano, bolinao, labuyo, darag

Native Chicken

The NextGen Project is a DA-Philrice-IRRI collaboration to develop rice varieties resistant to pests/diseases and tolerant to adverse environments

24 promising varieties developed through the NextGen Project  

Increased Sector Resilience to Climate Change Risk

PhP 85.5 B amount of insurance coverage

from 2011-2014

Increased risk insurance coverage

Our Goal, Thrusts and Priorities

Our Goal Support the President’s Philippine Development

Plan 2011-2016 to make the agriculture and fisheries sector competitive and sustainable

Sub-Sector Outcomes:

Productivity in agriculture and fishery

sector increased

Sector resilience to climate change risk

increased

Forward linkage to the industry and services

sectors increased

Rice

§  Promote high yielding and climate resilient varieties

§  Intensify extension services and expand ICT based advisory system

§  Increase irrigated area thru SSIS §  Invest more on RD&E for

sustainable growth

Our Thrusts and Priorities

FY 2016 Targets: Key Strategies:

Production: 20.09 MMT Yield: 4.08 MT/ha Area Harvest: 4.92 M ha

§  Increase yield thru the use of quality planting materials

§  Provide machineries/equipment and establish more post-harvest facilities in strategic areas

§  Entice the private sector to invest in big ticket projects like handling and storage

§  Link processing facilities and trading posts to private sector users

Our Thrusts and Priorities

FY 2016 Targets: Key Strategies: Corn: Production: 9.86 MMT Yield: 3.68 MT/ha Area Harvest: 2.68 M ha Cassava: Production: 3.88 MMT Yield: 15.76 MT/ha Area Harvest: 0.25 M ha

Corn and Cassava

§  Provide quality planting materials for priority commodities

§  Employ value chain analysis as tool for value- adding

§  Establish production facilities and postharvest equipment/machineries

§  Invest more on R, D & E §  Establish tramline systems for upland

areas

Our Thrusts and Priorities

FY 2016 Targets: Key Strategies:

Production:

Banana: 9.44 MMT

Mango: 0.89 MMT

Pineapple: 2.69 MMT

Coffee: 0.09 MMT

Rubber: 0.51 MMT

Cacao: 0.01 MMT

High Value Crops

§  Maintain disease-free statuses (i.e. FMD, PPR, Bird Flu)

§  Strengthen regulatory facilities and capacities to protect the borders from entry of communicable diseases

§  Fully implement Food Safety Act of 2013 for export readiness

§  Improve production and productivity through genetic improvement and nutrition

Our Thrusts and Priorities

FY 2016 Targets: Key Strategies:

Production:

Carabao: 0.15 MMT

Hog: 2.10 MMT

Goat: 0.08 MMT

Chicken: 1.82 MMT

Duck: 0.35 MMT

Livestock and Poultry

§  Provide livelihood to targeted poor fisherfolk

§  Train and deploy fishery law enforcers

§  Intensify fishery-based value-adding enterprises (i.e seaweed, aquasilvi, shellfish)

§  Construct municipal fish landings to reduce losses

Our Thrusts and Priorities

FY 2016 Targets: Key Strategies:

Production:

Commercial:

1.11 MMT

Municipal:

1.32 MMT

Aquaculture:

2.49 MMT

Fisheries

§  Increase production of organic agricultural products

§  Increase number of organic practitioners

§  Expand market niche/reach of organic products, both local and international

§  Increase number of certified organic farms/establishments

Our Thrusts and Priorities

FY 2016 Target: Key Strategies:

Devote/convert at least 5% of

total agricultural

area to organic farming

Organic Agriculture

§  Improve farm productivity and efficiency through block farming, infrastructure support, farm mechanization, socialized credit

§  Establish farm-to-mill roads in priority sugarcane areas

§  Implement an integrated human resource development program for dependents, farmers and workers of the industry

Our Thrusts and Priorities

FY 2016 Targets: Key Strategies: Sugarcane

Production: 26.21 MMT

Block farms strengthened: 19

§  Focus on small-scale irrigation projects (SSIPs) §  Invest in farm-to-market roads (FMR) §  Operationalize and strengthen Agri-Pinoy Trading

Centers (APTCs) §  Pursue farm mechanization for improved efficiency §  Establish post-harvest facilities

Our Thrusts and Priorities

Irrigation, Infrastructure and Mechanization

§  Build infrastructure such as FMRs and irrigation canals that can withstand weather-related shocks

§  Promote climate-adaptive farming systems

§  Develop more resilient varieties of crops and livestock

Our Thrusts and Priorities

Climate Change Responsiveness

Governance Reforms §  Use of science-based tools (i.e.

VSA, vulnerability analysis) §  Compulsory geotagging of major

programs and projects §  Continue the use and support the

updating of farmer and fisherfolk registry systems or database to improve targeting of beneficiaries (e.g. RSBSA, FishR)

§  Contract-based implementation of projects with LGU’s

§  Engagement of stakeholders

Our 2016 Budget

Our 2016 Budget

New Appropriations (Net of Corporations) 48,697,540 47,882,676 -1.7%Automatic Appropriations 625,787 495,096 -20.9%

TOTAL DA BUDGET (Net of Corporations) 49,323,327 48,377,772 -1.9%Budgetary Support to Attached Corporations 2,522,472 4,375,404 73.5%Automatic Appropriations 190,000 636,500 235%

SUBSIDY TO GOCC'S 2,712,472 5,011,904 84.8%GRAND TOTAL, DA 52,035,799 53,389,676 2.6%

FY 2015 AUTHORIZED

APPRO.

PARTICULARS(IN THOUSAND PESOS)

FY 2016 NEP % INCREASE/(DECREASE)

Including Attached Corporations

I n c r e m e n t a l : P 1 . 3 5 b i l l i o n o r 2 . 6 % h i g h e r t h a n 2 0 1 5 G A A

FY 2016 National Expenditure Program:

PhP 53.39 billion

Summary by Allotment Class Php 3.07 Billion

Php 19.99 Billion

Php 2.04 Billion

PS 6%

CO 37%

MOOE 57%

FINEX 0 %

Our 2016 Budget Including Attached Corporations

Php 30.33 Billion

MOOE 30,689,008 30,326,166CO 18,610,295 19,991,184PS 2,733,770 3,070,284FINEX 2,726 2,042

Grand Total, DA 52,035,799 53,389,676

FY 2015 Authorized Appropriation

Allotment Class(In Thousand Pesos) FY 2016 NEP

-1.2%7.4%

12.3%-25.1%

2.6%

% Increase/(Decrease)

Our 2016 Budget Including Attached Corporations

Summary by Allotment Class

Our 2016 Budget

DA Summary by Programs

GASS 858,493 1,208,931Support to Operations 1,394,811 1,222,115Operations 16,361,820 17,420,542

Sub-Total, Programs 18,615,124 19,851,588Locally Funded Projects 12,803,547 10,929,249Foreign Assisted Projects 7,583,065 9,107,676

Sub-total, Projects 20,386,612 20,036,925TOTAL, DA-OSEC 39,001,736 39,888,513ATTACHED AGENCIES 9,695,804 7,994,163ATTACHED CORPORATIONS 2,522,472 4,375,404

Retirement and Life Insurance Premium 216,563 248,207Special Accounts 599,224 883,389

AUTOMATIC APPROPRIATIONS 815,787 1,131,596GRAND TOTAL, DA 52,035,799 53,389,676

FY 2015 Authorized

Appropriations

Programs/Projects/Activities(In Thousand Pesos)

FY 2016 NEP

40.8%-12.4%

6.5%6.6%

-14.6%20.1%-1.7%2.3%

-17.6%73.5%14.6%47.4%38.7%2.6%

% Increase/(Decrease)

Our 2016 Budget

FY 2015 AUTHORIZED

APPRO.

KEY MAJOR PROGRAMS & PROJECTS

FY 2016 NEP

% INCREASE/(DECREASE)

Rice Program 7,003.5 7,060.3

Livestock Program 1,616.2 1,172.6

Corn Program 2,296.5 2,249.4

High Value Crops Development Program 2,199.7 2,918.6

Organic Agriculture Program 636.4 635.0

Fisheries Program 4,567.1 4,360.5Philippine Rural Development Project 7,328.4 9,062.8

Farm-to-Market Roads 6,250.0 7,051.2Total, Key Programs and Projects 31,897.7 34,510.4

0.8%

-27.4%

-2.1%

32.7%

-0.2%

-4.5%

23.7%

12.8%8.2%

By Key Programs and Projects

Our Priority Legislative Agenda

Our Legislative Agenda

§  National Land Use Act §  An Act Liberalizing the Export of Rice, Corn,

and Other Grains and Related Agricultural Products

§  ACEF Extension Act §  Philippine Halal Act §  An Act Strengthening the Philippine Crop

Insurance Corporation

Secretary Proceso J. Alcala 25 August 2015

A presentation for the members of the House of Representatives Committee on Appropriations

FY 2016 Plan and Budget Proposal Department of Agriculture’s