This document summarizes swine and pork industry data in the Philippines from 2006-2008. Some key points: - Total swine inventory in the Philippines was 13.7 million heads in 2008, up 1.8% from 2007. The majority (71%) were in backyard farms. - Total pork production in 2007 was 1,886 thousand metric tons, up 2.72% from 2006. The top producing regions were Region III and CALABARZON. - Total pork imports in 2007 were 43,936 thousand kilograms. Bellies and pork cuts made up the majority of imports. - Pork supply and demand were forecasted for 2008 using regression models. Supply was projected to

1. SWINE SITUATION REPORT 2008 Prepared by: Lary Nel B. Abao, MBA Bureau of Animal Industry-Marketing Development Division

2. I. Swine Industry Performance

3. Table 1. Swine: Inventory by Classification and by Farm Type, as of January 1, 2006-2008 Total inventory in 2008 stood at 13.7 M heads up by 1.8% vs. 2007 Total sow is up by 2.1% Fatteners/finishers are up by 1.85% Growers are up by 1.99%. Source: BAS

4. Figure 1. Distribution of Inventory by Classification, Philippines, as of January 1, 2008 12% of inventory are sow 24% and 29% of inventory are fatteners/finishers and growers, respectively. Source: BAS

5. Figure 2. Distribution of Inventory by Farm Type, Philippines, as of January 1, 2008 Backyard farms accounted for 71% of the total swine inventory. Commercial farm shared around 29% percent of the total swine stock Source: BAS

6. Table 2. Swine Top Regions, in terms of Inventory as of January 1, 2008 (no. of heads) Region III & CALABARZON are the top regions for commercial accounted for about 65%. Region VI and Region VIII are the top regions for backyard accounted for about 23%. Source: BAS

7. Table 3. Inventory Series by Age and By Quarter, 2006 – 2007 (Number of Head) P – Preliminary estimates Source: BAS

8. Table 4. SWINE: Total Farm Inventory, by Region, by Quarter, 2006-2007 Almost half (45%) of swine inventory came from Luzon Source: BAS

9. Table 5. SWINE: Volume of Production, by Quarter, 2005-2007 (in metric tons) Total volume of production in 2007 was recorded at 1,886.01 m.t. up by 2.72% vs 2006 . Source: BAS

10. Table 6. SWINE: Volume of Production, by Quarter, by Region 2005-2007 (in metric tons) Source: BAS

11. Table 7. SUPPLY AND DISPOSITION, PHILIPPINES, 2005-2007(Number of live animals) Total hogs disposed/slaughtered recorded at 22.3 M head about 14 hogs disposed/sow/year 2007 mortalities went up by 9.0% against 2006. About 12% mortalities out of total pigs born . Source: BAS

12. Source: BAI-MDD

13. II. Analysis of Feed Ingredients Prices Source: BAI-MDD

14. III. Analysis of Hog Commercial Mixed Feeds Prices Source: BAI-MDD Note: Only hog pre-starter mash is sold in 25-kg bags

15. Figure 6. Logistics Situation: Hogs (Live) Source: BAI-MDD; UNDP Study on Seed to Shelf HOG FARM P.72/kg P0.17/kg P12.42/kg P0.17/kg P2.31 P0.84/kg --- P18.65 Slaughter house • GSC Port • stevedoring • arastre Manila Port • stevedoring • arastre Includes • shipping • feeds • labor • shrinkage • mortality P93.00/kg • P4.00 Shipper’s Margin P100.48/kg • P4.50 Wholesaler’s Margin P126.78kg • P17.31 supermarket’s margin P144.09/kg P157.07kg • P30.29 Wet market’s margin

16. Figure 7. Carabeef Imports (in Kgs), 2003-08 Source: BAI-NVQS

17. Table 8. Carabeef Imports (in Kgs), 2008 Source: BAI-NVQS Month Forequarter Trimmings Grand Total Jan 5,859,954 951,000 6,810,954 Feb 4,633,976 587,524 5,221,500 Mar 4,673,968 921,916 5,595,884 Apr 5,754,522 756,000 6,510,522 May 4,802,536 727,000 5,529,536 Jun 5,335,944 642,992 5,978,936 Jul 3,795,860 587,000 4,382,860 Aug 6,505,018 446,716 6,951,734 Total 41,361,778 5,620,148 46,981,926

18. Figure 8. Pork Imports (in Kgs), 2003-08 Source: BAI-NVQS

19. Table 9. Pork Imports (in Kgs), 2008 Source: BAI-NVQS Note: *MDM Month Bellies Pork Cuts Deboned* Fats Offals Rind/Skin Grand Total Jan 397,992 980,313 27,000 2,712,180 2,428,992 967,450 7,513,927 Feb 492,644 1,099,421 27,000 2,646,304 2,272,701 976,505 7,514,575 Mar 302,656 1,552,252 26,336 2,683,102 2,225,168 1,314,179 8,103,692 Apr 1,102,036 3,057,945 107,433 3,497,274 1,963,047 1,620,403 11,348,137 May 1,284,928 4,450,990 103,020 3,768,311 3,038,323 1,241,905 13,887,477 Jun 1,032,637 3,989,881 27,000 3,807,187 2,585,728 1,354,184 12,796,616 Jul 976,653 4,876,783 27,000 2,286,650 2,687,711 1,184,443 12,039,241 Aug 913,934 3,753,651 105,495 1,850,226 2,510,679 1,117,116 10,251,101 Total 6,503,480 23,761,236 450,284 23,251,235 19,712,348 9,776,185 83,454,768

20. CURRENT: Supply = Production current + Total Imports where HProd = c + FAT t-1 + GROW t-1 + SOW t-4 + e VII. Pork Supply Forecast for 2008

21. Figure 9. Quarterly Hog Production, Philippines, 2006-2009F (in '000 MT)

22. Table 10. Quarterly Hog Production, 2006-2009F (in '000 MT) Month Production Percent Change Actual Forecast 07/06 08/07 09/08 2006 2007 2008 2008 2009 min mean min mean Q1 450.27 462.08 442.70 460.93 479.75 2.62 (4.19) 8.37 Q2 439.18 454.58 434.25 495.63 514.45 3.51 (4.47) 18.47 SEM1 889.45 916.66 876.95 956.56 994.20 3.06 (4.33) 13.37 Q3 432.45 438.97 448.25 467.06 1.51 6.40 #DIV/0! Q4 514.24 530.38 546.65 565.47 3.14 6.62 #DIV/0! SEM2 946.69 969.35 994.90 1032.53 2.39 6.52 ANNUAL 1,836.14 1,886.00 876.95 994.90 1,032.53 2.72 1.24

23. Table 11. Quarterly Pork Imports, 2006 - 2008F ('000 MT) Qtr Year % Change 2007 2008 2009 08/07 09/08 Q1 2.05 4.83 12.16 135.36 151.98 Q2 2.68 14.92 12.20 456.87 (18.22) Sem 1 4.73 19.74 24.36 317.49 23.38 Q3 5.06 12.07 138.84 Q4 3.66 12.12 230.72 Sem 2 8.72 24.19 0.00 177.45 Total 13.45 43.93 24.36 226.70 F - Forecast

24. Figure 10. Quarterly Pork Supply, Phils., 2006-2009F ('000 MT)

25. Table 12. Quarterly Pork Supply, 2007-2009F ('000 MT) Qtr 2007 2008 2008 2009 % Change 2008F min 2008F 2008F max 2009F min 2009F 2009F max 08/07 09Fmin/ 08 09F/ 08 09Fmax/08 Q1 325.51 314.72 334.95 347.98 361.02 (3.32) 6.43 10.57 14.71 Q2 320.88 318.89 359.27 372.31 385.35 (0.62) 12.66 16.75 20.84 Sem 1 646.39 633.61 694.22 720.30 746.37 (1.98) 9.57 13.68 17.80 Q3 312.34 325.98 339.02 352.06 (100.00) #DIV/0! #DIV/0! #DIV/0! Q4 374.93 394.90 407.94 420.98 (100.00) #DIV/0! #DIV/0! #DIV/0! Sem 2 687.26 0.00 720.89 746.96 773.04 0.00 0.00 0.00 (100.00) Total 1,333.65 633.61 720.89 746.96 773.04 694.22 720.30 746.37 3.52 9.57 13.68 17.80 F–Forecast

26. CURRENT: Regression Model Dependent Variable – based on household pork consumption of FIES (1994-2003) Independent variables : PCE at current prices, wholesale price of pork in MM Error term is normal, heteroscedastic, has serial correlation but no multicollinearity R 2 = 95.9% MAPE = 2.08% where HDem = c + PCE c + WPP BAS + e VIII. Pork Demand Forecast for 2008

27. Figure 11. Quarterly Pork Demand, Philippines, 2007-2009F ('000 MT)* F - Forecast *used 70% to convert as carcass

28. Table 13. Quarterly Pork Demand, 2007-2009F ('000 MT) Qtr Year % Change 2007 2008 min 2008 2008 max 2009F min 2009F 2009F max 08Fmin/ 07 08F/ 07 08Fmax/07 09Fmin/ 08F 09F/ 08F 09Fmax/ 08F Q1 307.99 299.65 311.79 323.93 309.71 321.85 333.99 (2.71) 1.23 5.17 (0.67) 3.23 7.12 Q2 326.49 309.69 321.83 333.97 345.55 357.69 369.83 (5.15) (1.43) 2.29 7.37 11.14 14.92 Sem 1 634.48 609.33 633.61 657.89 655.26 679.54 703.82 (3.96) (0.14) 3.69 3.42 7.25 11.08 Q3 328.91 324.15 336.29 348.43 (1.45) 2.24 5.94 (100.00) (100.00) (100.00) Q4 373.39 370.65 382.79 394.93 (0.74) 2.52 5.77 (100.00) (100.00) (100.00) Sem 2 702.30 694.80 719.08 743.36 (1.07) 2.39 5.85 Total 1,336.78 1,304.13 1,352.69 1,401.25 655.26 679.54 703.82 (2.44) 1.19 4.82 F-Forecast Revised PCE from NSCB Latest FIES is 2006 from NSO 2006 pork fies based on 2003 ratio

29. IX. Pork Supply & Demand Forecast for 2008

30. Figure 12. Quarterly Pork Supply vis-a-vis Demand, 2007-2009F ('000 MT) F - Forecast * Actual Demand estimated by PCE

31. Figure 13. Pork Supply and Demand, Quarterly, 2007-2009F ('000 MT)

32. Thank you very much!