Landbank puts up P1-B facility for Mindanao corn farmers

The Land Bank of the Philippines is putting up a P1-billion credit facility to help revive the ailing corn industry in Mindanao.

Landbank chief executive officer and president Gary Teves said the P1-billion fund is expected to be released before November when the corn planting season in Mindanao starts. He said the loan facility is open to both farmers and corn processors.

"The P1-billion allocation is part of the bank’s goal this year to increase to 45 from 38 percent last year its lending to the agri-agra sector and small and medium scale enterprises," said Teves.

Last year, Landbank appropriated P38 billion or 38 percent of its total loan portfolio for the agri-agra and SME sectors. This should increase by P8 billion to P9 billion this year.

About P500 million will go to the input support for use by farmers in their crop production activities and another P500 million will be used by processors to expand and improve their capabilities to absorb the expected surplus production from the use of hybrid corn variety.

Agriculture officials said about 250,000 hectares were identified for hybrid corn planting in the provinces of Bukidnon, South Cotabato, Sultan Kudarat, Zamboanga and Lanao del Sur.

DA sources said that while credit will be available, efforts to revive the ailing corn industry in Mindanao will also depend on the various corn farmers groups’ agreement on how to implement the program.

A DA official said: "It is critical that the stakeholders and the financing institutions collectively agree on the mechanics of lending, one that balances credit flow to farmers while guaranteeing high loan repayment."

Under the proposed corn-planting program, the production loan with be set at P14,000 per hectare. This should already cover expenses for seeds, fertilizers and other items directly related to corn production.

Equipment and other farm machinery will be available to cooperatives and corn processors to enhance farm efficiency. Most importantly, postharvest facilities will be provided to drastically reduce crop losses caused by poor storage and drying.

The DA will also assist co-ops in transporting corn to the main markets, mostly to integrated livestock producers. It has already talked to the cargo handling and shipping sectors to facilitate the transport of the commodity at cheaper rates.

To make sure corn farmers will get better prices for their produce, the DA has linked them with traders-businessmen associated with the Philippine Chamber of Commerce and Industry and the Mindanao Business Council.

The program, if properly implemented should revive the corn industry in the Mindanao region; plagued continuously over the last five years with various problems including low prices, poor crops, and as a result, area planted to corn has been reduced by about 200,000 hectares. Corn farmers also face competition from imported corn and from cheaper corn substitutes such as Indian wheat.