The report from the US Department of Agriculture’s Foreign Agricultural Services (FAS) on the Philippines highlights promising growth as a market for US agricultural exports. Projections suggest that US export shipments to the Philippines will surpass the record-high shipments of USD 3.56 billion recorded in 2022.
The forecast is fueled by the Philippines’ economic growth, robust household spending, and a revitalized hotel and restaurant sector that has exceeded pre-pandemic levels. As outlined in the report, the growth is supported by several factors: the expanding food and beverage manufacturing industry, projected to increase by 7 percent to USD 61.3 billion in 2024; a conservative growth in food retail sales due to reduced home cooking, shifting towards food delivery and dining out instead; and an expanding foodservice sector as tourism rebounds and more individuals opt for dining out and participating in events.
The report also noted Cebu City as a potential hub for receiving direct US goods such as US meat, potatoes, dairy products, and animal feed ingredients such as soyabeans since Cebu is among the top animal feed producing regions in the country. It is also noteworthy that hotels and restaurants in the region log more sales than their counterparts in Metro Manila.
Cebu is still the largest domestic shipping port in the Philippines, acting as a gateway and distribution hub for agricultural products throughout the Visayas region. On the contrary, some companies incur extra costs and take longer shipping lead times when their products are unloaded in Metro Manila. Therefore, US exporters are advised to seek out local partners located in Cebu to explore direct shipments, thus potentially mitigating these challenges.
Certain Quick-Service Restaurants (QSRs) and retailers have the option to procure products directly from importers as a means of cost reduction. QSRs import US poultry cuts and potato fries, whereas select restaurants and hotels purchase US prime beef and pork cuts, dairy products, and fruit from grocery stores. Retailers, on the other hand, import a variety of items, including beef, pork, chicken, turkey, apples, oranges, lemons, strawberries, condiments, soups, non-alcoholic beverages, and wines.
Source: Inquirer, Business World
