DA to invest P2 billion to perk up Philippines coffee output

Malaybalay, Bukidnon, Philippines — At least four in ten cups of coffee are produced locally.

That is the goal of the government as it seeks to reduce the country’s import dependency for coffee by at least 20 percentage points in the next few years by pouring in P2 billion in investments to boost domestic productivity.

Agriculture Secretary Francisco Tiu Laurel Jr. said the Department of Agriculture is committed to hiking the country’s coffee self-sufficiency currently standing at a measly 10 percent of the total annual demand.

Based on his estimates, Tiu Laurel said the government would need at least P1 billion to boost self-sufficiency in coffee by 10 percentage points to 15 percent, thus the DA would require at least P2 billion to hike import dependence by 20 to 30 percentage points by end of 2027.

To achieve the goal, at least 80,000 hectares must be planted with coffee with an average yield of one metric ton per hectare. A 40,000-hectare land planted with coffee with such average yield would reduce the country’s import dependency by 15 percentage points.

The agriculture chief said the budget for the coffee industry could come from an official development assistance (ODA) from the World Bank.

“It is actually a $2-billion ODA and I already went to Washington for that. And we were actually given another $12 million in grant but there are not specific details yet,” Tiu Laurel told reporters yesterday on the sidelines of the rollout of the Mindanao Robusta Coffee Project (MRCP) jointly undertaken by the DA and Nestlé Philippines here.

The ODA has been “more or less” approved, Tiu Laurel added. Furthermore, the agriculture chief said the other funding sources to improve the coffee industry could come from the DA’s high value crops fund and a realignment of its remaining 2024 budget.

Tiu Laurel said he is in initial discussions with the local government units of Sultan Kudarat and Bukidnon for the expansion of coffee production to at least 30,000 hectares in their provinces.

“More or less (we just need 10,000 hectares more). So, technically what we just lack is the money and the planting materials,” he said.

Nestlé executives welcome the plan of the government to boost domestic coffee production as it aligns with the multinational’s goal of purchasing more from domestic farmers and reduce their need to import raw materials abroad.

Nestlé’s coffee processing plant in Cagayan de Oro requires 40,000 metric tons of coffee annually but domestic production accounts for only 10 percent of its total requirement.

The DA and Nestlé yesterday distributed P4.464 million worth of fertilizers to 16 farmers associations and cooperatives in Bukidnon as beneficiaries of the MRCP. Mindanao accounts for at least 80 percent of the country’s annual Robusta coffee production.