SCHOOL OF PUBLIC AFFAIRS AND GOVERNANCE

Silliman University
Dumaguete City

Thought Leader
_____________________
In Partial Fulfillment of the Requirements
in Public Administration 43 Marketing for Public Governance and Non-profit Organizations
_____________________

A Report Paper
on
Analyzing the Marketing Mix of Asian Countries: Philippine Agriculture in Farming

Submitted By:

KIEFER JOHN V. SAGA

Student

Submitted To:

Anatoly Karpov P. Buss

Adviser

July 18, 2013

ANALYZING THE MARKETING MIX OF ASIAN COUNTRIES:

PHILIPPINE AGRICULTURE IN FARMING
INTRODUCTION:

Philippine agriculture consists of small, medium, and large farms ranging from
subsistence to commercial production and utilizing conventional methods like the use of high
yielding varieties and livestock breeds and extensive agrochemical inputs. Rice, corn, coconut,
sugar, livestock, and poultry are the major agricultural produce. While the Philippine economy is
traditionally anchored on agriculture, forestry, mining, and fishing, the manufacturing sector has
grown rapidly in recent years. Agriculture continues to be the major source of income and
employment in the total economy, employing nearly half of the total labor force and contributing
over 20% of gross domestic product. When all economic activities related to agro-processing
and supply of nonfarm agricultural inputs are included, the agricultural sector broadly defined
accounts for about two-thirds of the labor force and 40% of the gross domestic product. Equally
important to note is the fact that almost 70% of the poor belong to the rural sector.

Philippine agriculture plays a vital role in the economy. This attaches the high priority of
transforming agriculture into a modern, dynamic and competitive sector. A sustained expansion
of the national economy requires sustained growth in the agricultural sector. Agriculture
including forestry and fishery, plays a dominant role in the Philippine economy. The countrys
population is predominantly rural (70 percent of the total) and two-thirds of this population
depends on farming for their livelihood. In terms of employment, about one-half of the labor
force is engaged in agricultural activities. Primarily, Philippine agriculture consisted of rice, corn,
coconut, sugar, banana, livestock, poultry, other crops and fishery production activities. The
sectors contribution to the economy has been substantial 23% of gross domestic product in

2012. It registered a growth rate of 3.2%. The growth was mainly due to the expansion of the
poultry, livestock, and palay subsectors.

Now, the Philippine government doubles its focal point to provide and allocate budget in
agricultural field through the Department of Agriculture and its agencies. Making agriculture to
registered a 3.33 percent growth in the first quarter of 2013. All subsectors recorded increases
in production. Thus, an upward trend was noted in the crops subsector. Livestock and poultry
production grew, but, at slower rates. The fisheries subsector recovered from last year's
negative growth and posted the highest growth rate among the subsectors. Agriculture grossed
P352.5 billion at current prices. This represented a 3.33 percent increase from the last year's
record. To which, Philippines provide strategic ways in gaining a rank that boosts their capability
to be one of the self sustaining countries in terms of agricultural products. In connection,
importing of agricultural goods and products from other countries has depreciated from 57.9%
total imported agricultural goods to 39.8%, making Philippines to allocate its own agricultural
products to every citizen in the country.

4PS OF MARKETING ON PHILIPPINE AGRICULTURE IN FARMING

PLACE:
Philippines in Asia is located in the southeast Asia region, consisting of the countries
that are geographically south of China, east of India, west of New Guinea and north of Australia.
Prior to it, Philippines is the center piece of surrounding countries belonging to southeast Asia
which are Brunei, Cambodia, East-Timor, Indonesia, Laos, Malaysia, Myanmar, Singapore,
Thailand, Vietnam and a portion of mainland China. From this fact, Philippines have a wider gap
on providing a less hassle exportation of agricultural products to the surrounding countries. In
terms

of

climate,

the Climate

of

the

Philippines is

either tropical

rainforest, tropical

savanna or tropical monsoon, or humid subtropical in higher-altitude areas characterized by

relatively high temperature, oppressive humidity and plenty of rainfall, to which, having this kind
of climate makes the country very suitable in all Agricultural products to live and reproduce.
There are also classified into two seasons in the country, the wet season and the dry season,
based upon the amount of rainfall. This is dependent as well on your location in the country as
some areas experience rain all throughout the year. Based on temperature, the seven warmest
months of the year are from March to October; the winter monsoon brings cooler air from
November to February. May is the warmest month, and January, the coolest. Thus initiates a
broader based agricultural calendar in aiding the economy of the Philippines through monthly
revenue.
The Philippines is a tropical archipelago with 7,100 islands. The total land area of the
Philippine is placed at 30 M hectares. A total of 15.8 M hectares are classified into forest lands
and 14.2 M hectares are classified as alienable and disposable lands. Out of this 14.2 M
hectares, about 13 M hectares are devoted to agriculture of which 6.1 M hectares are highly
suitable for cultivation. The extent of agricultural areas in the Philippines are distributed for food
grains occupied 4.01 M hectares, for food crops utilized 8.33 M hectares, while nonfood crops
occupy 2.2 M hectares. For food grains, the average area for corn is 3.34 M hectares, while for
rice is 3.31 M hectares. For food crops, coconut accounted for the biggest average at 4.25 M
hectares, followed by sugarcane with 673,000 hectares, industrial crops with 591,000 hectares,
fruits with 148,000 hectares, vegetables and root crops with 270,000 hectares, pasture with
404,000 hectares, and cut flower with 133 hectares.

PRODUCT:
Philippines has emerged into modernization of its methods in sustainable agricultural
products, that their major products are exported worldwide for economical aiding. The country's
main agricultural crops are rice, corn, coconut, sugarcane, bananas, pineapple, coffee,

mangoes, tobacco, and abaca. Secondary crops include peanut, cassava, camote, garlic, onion,
cabbage, eggplant, calamansi, rubber, and cotton.
Philippine agricultural exports have been an essential driver in the agriculture sector and
constantly played a prominent role in the economy by providing foreign exchange earnings and
additional economic activities. Its contribution of US$2,166.91 million value to the national Gross
Domestic Product (GDP) in 2010 has significantly grown to US$4,101.08 million in 2011,
growing at an annual average rate of 9.66%. Of the countrys 190 agricultural export
destinations from 2004-2011, the US was constantly the biggest trading partner. It received 24%
of the total agricultural exports of the country followed by Japan and the Netherlands with
distant shares of 14% and 11%, respectively. The US was the major destination of coconut oil
crude and refined, tuna, pineapple and pineapple products, seaweeds and carrageenans,
desiccated coconut, and centrifugal sugar. Meanwhile, Japan was the countrys biggest export
market for fresh banana, shrimps and prawns, and also a major destination for pineapple and
pineapple products. Desiccated coconut, seaweeds and carrageenans, and coconut oil were
largely exported to the European countries Netherlands, Italy, United Kingdom, Germany, Spain
and France. Vietnam, on the other hand, has remained the largest destination of manufactured
fertilizer, followed mostly by Asian countriesThailand, India and Indonesia.

PRICE:
The country's Gross National Income (GNI) increased by 3.20 percent in 2011. Gross
Domestic Product (GDP) registered a 3.91 percent growth. The Gross Value Added (GVA) in
agriculture and fishing expanded by 2.46 percent. This sector contributed 11 percent to the
GDP. Prices received by farmers for their produce in 2011 were 7.53 percent higher than the
previous year's record. Prices of cereals, on the average, grew by 4.73 percent. Palay price was
up by 2.11 percent. Price of matured yellow corn increased by 4.55 percent and that of matured

white corn, by 34.51 percent. Vegetables and legumes posted the biggest price gain at 33.60
percent.
Specifically, the prices of agricultural products from farming in the country are affordable
enough for the Filipinos and can contribute to uplift the farmers. Prices from regular milled last
July 12, 2013 increased by 6.67% from 30.00 to 32.00, a regular increase due to the long
duration of bad weather in the country. On refined sugar, the price is stable for about 4 months
now having only 45.00 with 0% change. And on vegetables, the average increase is 34% having
diversified for 13 types of vegetables. Thus on the concern of exportation prices, government
provide substantial tax for every shipment of the exportation of agricultural products. Such that
2012 was the year when fruits, vegetables and other major agricultural products increased in
price exportation from zero base last 2011 to 68.5% of price increment. Due to the reason that,
exportation aids the rumbling economy of the Philippines in terms of GDP and GVA.

PROMOTION:

Philippines indicated that most agricultural products are globally competitive as import
substitutes. Among its crop commodities, coconut oil, palm oil, cavendish banana, banana
chips, coffee beans, mango, pineapple, durian and mangosteen, onion abaca, cacao, and
rubber are export-competitive crops. Except raw sugar and garlic, other crops rice, yellow corn,
potato, cassava, vegetables, tomato and cut flowers are competitive as import substitutes. The
competitiveness factor include, among others, productivity, border prices, costs of production,
quality, and volumes, especially for exports.

Currently, last June 17, 2013, President Benigno S. Aquino III has approved the law that
will further modernize the agriculture and fisheries sector. The Agricultural and Fisheries
Mechanization Law mandates the state to promote the development and adoption of modern,
appropriate and cost-effective and environmentally-safe agricultural and fisheries machinery

and equipment to enhance farm productivity and efficiency in order to achieve food security and
safety and increase farmers' income.

The Department of Agriculture (DA) will craft a five-year National Agri-Fishery Program
to promote a conducive-environment for the local assembling and manufacturing of equipment
for agricultural and fisheries production, processing and marketing. Local government units,
through an ordinance, shall also formulate in consultation with the DA and implement their
respective provincial, city and municipal agricultural and fishery mechanization plans as a vital
component of their respective local development plans. The use of renewable and
nonconventional energy such as wind, solar, hydro, biomass and other farm-based energy
sources shall be promoted as power sources for the operation and maintenance of agricultural
and fisheries machinery, according to the law. All manufacturers, fabricators, assemblers and
importers must register with the Bureau of Agricultural and Fisheries Engineering within six
months upon enactment of the law. From this, it will exhibit a wider picture for Philippines as the
prime hotspot of Agriculture in Asia and even the world. Thus, it will help support the economy
of the country to boost in the peak of it and backboned by safe and strategic method of
modernization in agricultural sectors. Whereof, providing bigger opportunities for small scale
farmers in world market of Agriculture and as so to retain the status of prime contributor of
agricultural products to the world.