Required Report - public distribution

**Date:** 9/23/2003

**GAIN Report Number:** RP3053

RP3053

**Philippines**

**Livestock and Products**

**Annual**

**2003**

**Approved by:**

![](media/image1.wmf)David C. Miller

#### FAS Manila

**Prepared by:**

Pia A. Ang

**Report Highlights:**

The total Philippine livestock sector is expected to continue to expand
through 2004; overall meat consumption is likely to continue growing
through 2004 due to the rapidly growing Philippine population. Imports
of premium beef cuts are likely to remain insignificant relative to
overall beef and veal imports through 2004. No significant changes in
live swine and pork imports are expected for the next two years due to
good local production.

Includes PSD Changes: No

Includes Trade Matrix: No

Annual Report

Manila \[RP1\]

\[RP\]

# Executive Summary

The total Philippine livestock sector is expected to continue to expand
through 2004 due to the expanding domestic swine industry. Overall meat
consumption is likely to continue growing through 2004 due to the
rapidly growing Philippine population, currently estimated at 82
million. Beef imports are likely to post modest increases for the next
two years mainly due to increasing beef demand by the expanding domestic
meat processing industry. Imports of premium beef cuts are likely to
remain insignificant relative to overall beef and veal imports through
2004. No significant changes in live swine and pork imports are expected
for the next two years due to good local production. Currently, the DA
is contemplating imposing a special safeguard duty for pork products as
a result of the clamor of the livestock industry for more protection
from the alleged onslaught of illegal pork entering the market.

# Production

Driven by strong demand for pork and pork products, hog production is
expected to continue growing through 2004. Last year, swine production
comprised roughly three-quarters of overall livestock production. This
made the domestic swine industry the second largest agricultural
commodity in 2002, contributing around P87 billion (\$1.58 billion) to
the overall agricultural output.

Further consolidation of the industry is expected in the next two years
as the share of backyard farms is expected to decline while that of
large commercial hog farms is forecast to increase. This indicates
increasing scale of swine production and continued inflows of investment
into the industry.

Cattle production (inclusive of "carabaos" or water buffalos) last year,
was adjusted downwards consistent with estimates from the Bureau of
Agricultural Statistics (BAS). Although the 2002 calf crop of water
buffalos was higher than the previous year, the decline in live cattle
births pulled down overall live cattle production in 2002. There were
more--than-usual losses as a result of a higher mortality rate. The
overwhelming majority, or around 90 percent of all live cattle in the
country continue to come from backyard raisers. These small-scale
operations usually involve a few head of feeder cattle for fattening
and/or carabaos used as work animals. The few head of cattle are usually
contracted out to these small-scale operators by large feedlot operators
which have integrated abattoir operations.

Cow-calf operations are declining in number due to reasons that
discourage investment in commercial cattle ranching. These, to name a
few, include peace and order problems in production areas, policies on
pasture leasing, agrarian reform uncertainties, land conversion, etc.

Due to lower cattle production numbers, cattle slaughter rates were
likewise pared down during the year. The domestic cattle industry is
expected to recover this year and grow through 2004 because of continued
expansion of water buffalo production. Carabaos are currently estimated
to comprise around 55 percent of the overall Philippine bovine sector

Farm gate prices of live cattle last year, in general, were higher than
previous year levels mainly due to the decline in local production.
Monthly average farmgate price per kilogram for cattle last year was
P51.14 (\$0.94), slightly higher than the P50.73 (\$0.93) average of
last year.

  ----------------------- --------------- --------------- ---------------
  **Prices Table**                                        

  **Country**             Philippines                     

  **Commodity**           Animal Numbers,                 
                          Cattle                          

  Prices in               Pesos           per uom         kilogram

                                                          

  Year                    2001            2002            \% Change

  Jan                     50.28           50.74           0.91%

  Feb                     51.10           50.73           -0.72%

  Mar                     50.55           51.73           2.33%

  Apr                     51.61           51.38           -0.45%

  May                     51.24           51.87           1.23%

  Jun                     51.03           51.14           0.22%

  Jul                     50.52           50.40           -0.24%

  Aug                     50.08           50.68           1.20%

  Sep                     50.27           50.91           1.27%

  Oct                     49.72           51.12           2.82%

  Nov                     51.45           51.52           0.14%

  Dec                     50.86           51.42           1.10%
  ----------------------- --------------- --------------- ---------------

Source: Bureau of Agricultural Statistics

The average live weight prices of hogs in 2002, on the other hand,
decreased slightly (2.03 percent) from the previous year's average price
due to good production. Local hog raisers, however, blame the entry of
smuggled or illegally imported pork and pork products for the decline in
prices. As a result, concerned industry groups have petitioned the GRP
for appropriate protective measures (see POLICY).

  --------------------- ------------------ --------------- ---------------
  **Prices Table,                                          
  Farmgate**                                               

  **Country**           Philippines                        

  **Commodity**         Animal Numbers,                    
                        Swine                              

  Prices in             Pesos              Per uom         kilogram

                                                           

  Year                  2001               2002            \% Change

  Jan                   50.52              51.68           2.30%

  Feb                   51.44              52.35           1.77%

  Mar                   52.13              52.09           -0.08%

  Apr                   52.82              52.66           -0.30%

  May                   53.43              52.27           -2.17%

  Jun                   52.81              51.70           -2.10%

  Jul                   53.09              50.89           -4.14%

  Aug                   51.95              50.23           -3.31%

  Sep                   51.87              49.96           -3.68%

  Oct                   51.45              49.99           -2.84%

  Nov                   51.77              49.76           -3.88%

  Dec                   52.43              49.44           -5.70%
  --------------------- ------------------ --------------- ---------------

Source: Bureau of Agricultural Statistics

Like swine, good water buffalo production resulted in lower farm gate
prices last year. Water buffalo farm gate prices during the period
averaged P41.04 (\$0.75) per kilogram, slightly below the 2001 level of
P41.80 (\$0.77) per kilogram.

  ------------------- ------------------- ----------------- ---------------
  **Prices Table,                                           
  Farmgate**                                                

  **Country**         Philippines                           

  **Commodity**       Animal Numbers,                       
                      Water Buffalo                         

  Prices in           Pesos               per uom           kilogram

                                                            

  Year                2001                2002              \% Change

  Jan                 40.59               39.85             -1.82%

  Feb                 41.65               41.72             0.17%

  Mar                 40.93               41.29             0.88%

  Apr                 42.84               40.91             -4.51%

  May                 42.94               41.16             -4.15%

  Jun                 43.86               41.42             -5.56%

  Jul                 42.09               40.42             -3.97%

  Aug                 42.06               41.97             -0.21%

  Sep                 40.55               40.33             -0.54%

  Oct                 41.02               41.23             0.51%

  Nov                 41.66               41.36             -0.72%

  Dec                 41.35               40.81             -1.31%
  ------------------- ------------------- ----------------- ---------------

Source: Bureau of Agricultural Statistics

# Consumption

According to the National Economic Development Authority (NEDA), the
Philippine domestic economy grew 4.6 percent last year, faster than the
3.2 percent increase posted in 2001. The 2002 growth rate was the
highest for the country since the 1997 financial crisis, and surpassed
the government's GDP target of 4.5 percent.

For this year, the GRP has forecast a GDP growth rate of 4.2 to 5.2
percent. Economists from the International Monetary Fund (IMF) and the
World Bank, however, have projected Philippine GDP growth to fall to 3.9
to 4.0 percent range in 2003.

Despite the lower projections, however, overall meat consumption is
likely to continue growing through 2004 due to the rapidly growing
Philippine population, currently estimated at 82 million. Expanding at a
rate of 2.3 percent annually, there will be roughly an additional 2
million Filipinos to feed next year.

Increased consumption likewise is enhanced by the relatively low
inflation rate (forecast at 4.5 to 5.5 percent this year) and the
ensuing stable food prices. The average Filipino household spends
roughly half of its earnings on food. Food and meat consumption
traditionally peaks in the fourth quarter to coincide with the holiday
season.

In addition, increased spending on food is expected in the near future,
as a result of Presidential election-related activities scheduled for
May 2004. Campaign activities start very early in the Philippines.

Pork, as in the past, will continue to dominate meat consumption through
2004, and relatively low pork prices are expected to further strengthen
quantities moving into distribution. Household demand is estimated to
account for 86 percent of total pork consumption, while hotels,
restaurant, institutional buyers and processors account for the balance.

  ----------------------- --------------- --------------- ---------------
  **Prices Table**                                        

  **Country**             Philippines                     

  **Commodity**           Meat, Swine                     

  Prices in               Pesos           per uom         kilogram

                                                          

  Year                    2001            2002            \% Change

  Jan                     110.66          115.80          4.64%

  Feb                     115.04          116.37          1.16%

  Mar                     118.36          117.86          -0.42%

  Apr                     119.08          118.27          -0.68%

  May                     119.52          115.92          -3.01%

  Jun                     118.89          113.69          -4.37%

  Jul                     117.28          112.72          -3.89%

  Aug                     115.69          111.32          -3.78%

  Sep                     113.79          108.70          -4.47%

  Oct                     113.28          108.13          -4.55%

  Nov                     113.33          108.45          -4.31%

  Dec                     114.61          109.19          -4.73%
  ----------------------- --------------- --------------- ---------------

Source: Bureau of Agricultural Statistics

The retail price of beef increased by an average of 5.6 percent in 2002,
with January posting the highest price increase of 10.54 percent over
the previous year. The price of beef was highest during May 2002,
averaging P170.78 per kg. The retail price of beef during the first
three months of 2003 continued its upward trend with an average price
increase of 8.7 percent between January to March 2003. Since, the local
cattle industry is mainly composed of small backyard operations, traders
play a significant role in the marketing of cattle and beef. This drives
up local beef prices as evidenced by the difference in farmgate and
retail prices.

  --------------------- ------------------ --------------- ---------------
  **Prices Table**                                         

  **Country**           Philippines                        

  **Commodity**         Meat, Beef and                     
                        Veal                               

  Prices in             Pesos              per uom         kilogram

                                                           

  Year                  2001               2002            \% Change

  Jan                   151.49             167.46          10.54%

  Feb                   158.88             166.55          4.83%

  Mar                   158.93             166.46          4.74%

  Apr                   158.25             169.71          7.24%

  May                   158.00             170.78          8.09%

  Jun                   158.90             169.57          6.71%

  Jul                   158.96             169.01          6.32%

  Aug                   159.49             169.18          6.08%

  Sep                   159.28             168.95          6.07%

  Oct                   159.22             168.15          5.61%

  Nov                   163.99             164.55          0.34%

  Dec                   165.82             168.46          1.59%
  --------------------- ------------------ --------------- ---------------

Source: Bureau of Agricultural Statistics

Water buffalo meat prices are not readily available but are generally
regarded to be cheaper than beef or meat from conventional breeds.

# Trade 

Live cattle import statistics for 2002 were revised as local production
was lower than expected and beef demand started to strengthen due to the
diminishing concern over BSE. Feeder cattle represent about 99 percent
of all live cattle imports, and local cattle raisers turned to imports
to replenish their feeder stocks. Live cattle imports are expected to
remain flat in 2003 mainly due to renewed weakness of the Peso.
Australia is the overwhelming source of Philippine live cattle imports
and is also a major beef supplier.

For meat, beef imports are likely to post modest increases for the next
two years mainly due to increasing beef demand by the expanding domestic
meat processing industry. Imports of premium beef cuts are likely to
remain insignificant relative to overall beef and veal imports through
2004. India is the dominant source of manufacturing grade beef imports
and is expected to maintain its dominance in that sector. India provides
over 60 percent of the country's overall beef imports, with Brazil and
Australia roughly supplying 20 percent each.

Local livestock farmers have raised animal health concerns, particularly
foot and mouth disease (FMD), relative to the continued entry of buffalo
meat from India, which is not FMD-free. Outbreaks of FMD still occur in
the Luzon and Visayas regions and disease control is a major problem of
the local livestock sector. Indian beef, however, is cheaper compared to
traditional beef sources and is a major ingredient used by meat
processing firms. Despite robust growth, the domestic hog industry has
claimed injury from the proliferation of buffalo meat in the wet
markets. In response, the Philippine Department of Agriculture (DA)
released last December, Administrative Order No. 31 (AO 31) or
"Supplemental Guidelines on the Importation and Utilization of Buffalo
Meat from India" (refer to RP 3004). AO 31 requires that imported Indian
buffalo meat be used for processing only and that a third party
inspection certificate accompany all Indian beef imports. AO 31 likewise
specifies appropriate labeling to enhance traceability of
manufacturer/producer.

Also in late 2002, Department of Agriculture (DA) officials together
with a group of Philippine meat importers, went to South America to
establish relations with alternative meat sources. They reportedly
accredited meat processing plants and abattoirs.

No significant changes in live swine and pork imports are expected for
the next two years due to good local production. Legitimate pork imports
remain minimal and go mostly to the expanding domestic meat processing
industries. Local hog raisers are positioning themselves to gain a share
of this growing market and are therefore quite vocal about illegal
imports. Local meat processors, however, prefer imported frozen pork for
their raw material, contending that locally produced pork does not
conform to their quality specifications, uniformity, consistency, etc.
The major sources of frozen pork (carcasses/half-carcasses, hams,
shoulders and cuts) include Denmark, Canada, United States, Korea and
Australia.

#### Tariff-Rate Quota

Utilization of the Minimum Access Volume (MAV) or tariff-rate quota for
fresh, chilled or frozen pork last year was 13.3 percent. MAV usage for
pork has remained low and has been declining since 2000. This may partly
be the result of the inflow of illegally imported livestock and poultry
meats, including pork. For 2003, the MAV for pork is 50,595 MT. The
in-quota duty for fresh, chilled or frozen pork (0203) is 30 percent
while the out-of-quota rate is 40 percent.

+----------+----+------+------+------+------+----+-------+--------+
| Heading  | CY | MAV  | M    |      |      |    |       | Utili  |
| No./     |    |      | AVIC |      |      |    |       | zation |
| N.?./.   |    |      | 'S\* |      |      |    |       |        |
|          |    |      | Is   |      |      |    |       |        |
|          |    |      | sued |      |      |    |       |        |
|          |    |      | (MT) |      |      |    |       |        |
+----------+----+------+------+------+------+----+-------+--------+
| Des      |    | (MT) | Jan  | Apr- | Jul  | O  | TOTAL |        |
| cription |    |      | -Mar | Jun  | -Sep | ct |       |        |
|          |    |      |      |      |      | -D |       |        |
|          |    |      | Mar  |      |      | ec |       |        |
+----------+----+------+------+------+------+----+-------+--------+
| HS 02.03 |    |      |      |      |      |    |       |        |
+----------+----+------+------+------+------+----+-------+--------+
| Fresh    | 20 | 48   | 1    | 1    |      |    | 6,410 | 13.3   |
|          | 02 | ,185 | ,450 | ,295 |      |    |       |        |
+----------+----+------+------+------+------+----+-------+--------+
| Chilled, | 20 | 50   | 1    | 2    | 798  |    | 5,179 | 10.2   |
| Frozen   | 03 | ,595 | ,548 | ,834 |      |    |       |        |
+----------+----+------+------+------+------+----+-------+--------+
| Pork     |    |      |      |      |      |    |       |        |
+----------+----+------+------+------+------+----+-------+--------+

Source: Department of Agriculture

\* Minimum Access Volume Import Certificates

MAV utilization for this year will likely not deviate significantly from
the previous year's performance. Based on issued Minimum Access Volume
Import Certificates (MAVICs), the in-quota importation of pork for the
January to July 2003 period represents just a little over 10 percent of
the total tariff rate quota for the whole calendar year.

Duties for fresh, chilled or frozen swine meat (0203) and processed pork
products (1602) were supposed to be brought down to 40 percent beginning
January 1, 2003. Executive Order No. 164 (EO 164), dated January 10,
2003, however, effectively delayed the scheduled tariff rate reduction
until June 30, 2003. Effective July 1, 2003, fresh, chilled and frozen
pork out-of-quota imports will be levied a 40 percent duty. In-quota
tariff will be 30 percent.

2003-2004 Tariff rates for live swine follow:

+-----------+--------------------------------------------+-------------+
| ###       |                                            |             |
|  TARIFF R |                                            |             |
| ATES FOR  |                                            |             |
| 2003-2004 |                                            |             |
+-----------+--------------------------------------------+-------------+
| H.S. Code | Description                                | Rate of     |
|           |                                            | Duty        |
+-----------+--------------------------------------------+-------------+
| 0103      | Live swine                                 | 2003        |
+-----------+--------------------------------------------+-------------+
| 0         | Pure-bred breeding animals                 | 3           |
| 103.10.00 |                                            |             |
+-----------+--------------------------------------------+-------------+
|           | Other                                      |             |
+-----------+--------------------------------------------+-------------+
| 0103.91   | \- - Weighing less than 50 kg              |             |
+-----------+--------------------------------------------+-------------+
| 0         | \- - - In-Quota                            | 30          |
| 103.91.10 |                                            |             |
+-----------+--------------------------------------------+-------------+
| 0         | \- - - Out-of-quota                        | 35\*        |
| 103.91.20 |                                            |             |
+-----------+--------------------------------------------+-------------+
| 0103.92   | \- - Weighing 50 kg or more                |             |
+-----------+--------------------------------------------+-------------+
| 0         | \- - - In-Quota                            | 30          |
| 103.92.20 |                                            |             |
+-----------+--------------------------------------------+-------------+
| 0         | \- - - Out-of-Quota                        | 30          |
| 103.92.20 |                                            |             |
+-----------+--------------------------------------------+-------------+

(\* In effect as of July 1,2003 as amended by Executive Order No. 164)

There is no change in import tariffs for live bovine animals and their
meats from thei 2002 rates. Duties for live bovine animals, whether
pure-bred or otherwise, remain at 3 percent while imported fresh, frozen
or chilled meat of bovine animals is levied a 10 percent tariff.

# Marketing

Although the wet markets supply about 90 percent of the food demand of
the Filipino market, the number of supermarkets and grocery outlet has
been increasing, particularly in the urban centers of the country. This
trend is expected to continue as the urban population continues to
expand. This is cause to project increased consumption of prepared and
preserved, as well as processed meat products in the coming years, and
local meat processors appear to be positioning themselves accordingly.

The Philippine Association of Meat Processors (PAMPI) reportedly has
said that at least one third of its 30 million kilograms of meat imports
(worth \$51 million) may be sourced from Brazil and other Latin American
countries if more of their meat plants and abattoirs are accredited by
the National Meat Inspection Commission (NMIC). PAMPI believes that the
South American beef suppliers may be able to replace the 30 percent of
PAMPI's meat requirement, which it lost from Europe when it experienced
an outbreak of BSE two years ago. Local meat processors are reportedly
projecting a growth of 15 percent this year with gross sales of about
P46 billion.

San Miguel Corporation (SMC), the largest food and beverage conglomerate
in the Philippines, has announced that it will undertake an over-all
strategy of developing an integrated market approach for poultry, meats
and branded processed products. SMC, reportedly intends to gradually
shift from its dependence on commodity type products such as poultry and
basic meats by further developing its branded value-added meats
portfolio. Expansion into other branded products variants and extensions
is also being studied as another source of future growth. SMC's basic
meats business ended 2002 with total sales volume growing by 7 percent.
Beef and pork grew by 25 percent and 8 percent, respectively.

###### Policy

# In September 2002, the Philippines notified the WTO of its intention to require accreditation by 3^rd^ party auditors of all plants exporting meat, poultry and dairy products to the Philippines. Memorandum Order Number 7 (MO 7) was supposed to ensure compliance with "internationally recognized standards in Hazard Analysis and Critical Control Point (HACCP) program." The measure was to take effect April 1, 2003 and would have adversely affected over \$55 million worth of US exports to the Philippines. Protests against MO 7, both bilaterally and at the SPS Committee in Geneva in November 2002 resulted in the postponement of the implementation of MO 7. The proposed regulation is currently under review by the DA.

Perhaps the most significant development relative to agricultural policy
is the replacement of then DA Secretary, Leonardo Q. Montemayor with
Luis P. Lorenzo Jr. on November 30, 2002 (refer to RP 2079). Early in
office, Mr. Lorenzo announced he would work for continued protection of
sensitive agricultural products, such as rice, sugar, corn, poultry and
pork. He has likewise expressed his intention of providing local farmers
with government support to enhance their competitiveness in a
liberalized trade environment, and part of that support includes keeping
tariff rates for major local commodities at current levels.

Currently, the DA is contemplating imposing a special safeguard duty for
pork products as a result of the clamor of the livestock industry for
more protection from the alleged onslaught of illegal pork entering the
market. Local swine producers have been lobbying for additional
protection. BAS data show a decline of only 2.5 percent for both retail
and farmgate price of pork in 2002.

Several livestock import bans were imposed under the new DA
administration although most of them were lifted after scientific
investigation indicated that the necessary corrective measures were in
place. These include:

1\. A temporary ban on the entry of Australian beef after receiving a
report that a heifer from Victoria, Australia had died of Anthrax. The
DA subsequently lifted the import restriction after receiving a report
from the Australian government outlining efforts to contain the anthrax.

2\. In response to reports of Dioxin contamination in March 2003, the DA
banned all imports of feed, milk and milk products, eggs, meat and meat
products from Germany and the Netherlands. The ban was lifted after two
weeks after receiving assurances that adequate measures were being
undertaken to contain the contamination in those countries.

3\. On May 2003, the DA prohibited the importation of live cattle, sheep
and goats and their meat and meat products from Canada in response to a
confirmed case of BSE in that country. The ban was subsequently lifted
in August 2003.

4\. The DA likewise lifted the temporary ban on the importation of pork
and pork products and by-products from the Republic of Korea after a
report from the Office Internationale des Epizooties (OIE) declaring
Korea as a FMD-free country in May 2003. The Bureau of Animal Industry
has found the risk of contamination from importing pork, pork products
and by-products from the ROK to be negligible.

  ------------------- ----------------- ---------- -- ---- ---------- ---- -- ---------- --- ---------- ---- ------- ---------- -- --
  **PSD Table**                                                                                                                    

  **Country**         **Philippines**                                                                                              

  **Commodity**       **Animal Numbers,                                                                      (1000                 
                      Cattle**                                                                               HEAD)                 

                      2002              Revised            2003               Estimate       2004                    Forecast      

                      USDA Official     Post               USDA               Post           USDA                    Post          
                      \[Old\]           Estimate           Official           Estimate       Official                Estimate      
                                        \[New\]            \[Old\]            \[New\]        \[Old\]                 \[New\]       

  **Market Year                         01/2002                               01/2003                                01/2004       
  Begin**                                                                                                                          

  Total Cattle Beg.   5512              5512               5502               5567           5477                    5592          
  Stks                                                                                                                             

  Dairy Cows Beg.     0                 0                  0                  0              0                       0             
  Stocks                                                                                                                           

  Beef Cows Beg.      0                 0                  0                  0              0                       0             
  Stocks                                                                                                                           

  Production (Calf    1185              1141               1190               1190           0                       1195          
  Crop)                                                                                                                            

  Intra EC Imports    0                 0                  0                  0              0                       0             

  Other Imports       70                120                100                120            0                       130           

  TOTAL Imports       70                120                100                120            0                       130           

  TOTAL SUPPLY        6767              6773               6792               6877           5477                    6917          

  Intra EC Exports    0                 0                  0                  0              0                       0             

  Other Exports       0                 0                  0                  0              0                       0             

  TOTAL Exports       0                 0                  0                  0              0                       0             

  Cow Slaughter       0                 0                  0                  0              0                       0             

  Calf Slaughter      0                 0                  0                  0              0                       0             

  Other Slaughter     1225              1150               1275               1237           0                       1250          

  Total Slaughter     1225              1150               1275               1237           0                       1250          

  Loss                40                56                 40                 48             0                       50            

  Ending Inventories  5502              5567               5477               5592           0                       5617          

  TOTAL DISTRIBUTION  6767              6773               6792               6877           0                       6917          

  Calendar Yr. Imp.   5                 0                  0                  0              0                       0             
  from U.S.                                                                                                                        

  Calendar Yr. Exp.   0                 0                  0                  0              0                       0             
  to U.S.                                                                                                                          
  ------------------- ----------------- ---------- -- ---- ---------- ---- -- ---------- --- ---------- ---- ------- ---------- -- --

  -------------------- ----------------- ---------- ---------- ---------- ----------- ----------
  **PSD Table**                                                                       

  **Country**          **Philippines**                                                

  **Commodity**        **Meat, Beef and                                   (1000 MT    
                       Veal**                                             CWE)(1000   
                                                                          HEAD)       

                       2002              Revised    2003       Estimate   2004        Forecast

                       USDA Official     Post       USDA       Post       USDA        Post
                       \[Old\]           Estimate   Official   Estimate   Official    Estimate
                                         \[New\]    \[Old\]    \[New\]    \[Old\]     \[New\]

  **Market Year                          01/2002               01/2003                01/2004
  Begin**                                                                             

  Slaughter            1225              1150       1275       1237       0           1250
  (Reference)                                                                         

  Beginning Stocks     28                28         10         0          5           0

  Production           220               220        230        230        0           235

  Intra EC Imports     0                 0          0          0          0           0

  Other Imports        115               115        130        120        0           125

  TOTAL Imports        115               115        130        120        0           125

  TOTAL SUPPLY         363               363        370        350        5           360

  Intra EC Exports     0                 0          0          0          0           0

  Other Exports        0                 0          0          0          0           0

  TOTAL Exports        0                 0          0          0          0           0

  Human Dom.           330               330        345        340        0           350
  Consumption                                                                         

  Other Use, Losses    23                33         20         10         0           10

  TOTAL Dom.           353               363        365        350        0           360
  Consumption                                                                         

  Ending Stocks        10                0          5          0          0           0

  TOTAL DISTRIBUTION   363               363        370        350        0           360

  Calendar Yr. Imp.    2                 2          0          2          0           2
  from U.S.                                                                           

  Calendar Yr. Exp. to 0                 0          0          0          0           0
  U.S.                                                                                
  -------------------- ----------------- ---------- ---------- ---------- ----------- ----------

  -------------------- ----------------- ---------- ---------- ---------- ---------- ----------
  **PSD Table**                                                                      

  **Country**          **Philippines**                                               

  **Commodity**        **Animal Numbers,                                  (1000      
                       Swine**                                            HEAD)      

                       2002              Revised    2003       Estimate   2004       Forecast

                       USDA Official     Post       USDA       Post       USDA       Post
                       \[Old\]           Estimate   Official   Estimate   Official   Estimate
                                         \[New\]    \[Old\]    \[New\]    \[Old\]    \[New\]

  **Market Year                          01/2002               01/2003               01/2004
  Begin**                                                                            

  TOTAL Beginning      11816             11816      12218      12218      12345      12620
  Stocks                                                                             

  Sow Beginning Stocks 1950              1950       1975       2000       0          2075

  Production (Pig      21500             21500      21725      22000      0          22550
  Crop)                                                                              

  Intra EC Imports     0                 0          0          0          0          0

  Other Imports        2                 2          2          2          0          2

  TOTAL Imports        2                 2          2          2          0          2

  TOTAL SUPPLY         33318             33318      33945      34220      12345      35172

  Intra EC Exports     0                 0          0          0          0          0

  Other Exports        0                 0          0          0          0          0

  TOTAL Exports        0                 0          0          0          0          0

  Sow Slaughter        0                 0          0          0          0          0

  OTHER SLAUGHTER      19500             19500      20000      20000      0          20750

  Total Slaughter      19500             19500      20000      20000      0          20750

  Loss                 1600              1600       1600       1600       0          1622

  Ending Inventories   12218             12218      12345      12620      0          12800

  TOTAL DISTRIBUTION   33318             33318      33945      34220      0          35172

  Calendar Yr. Imp.    0                 0          0          0          0          0
  from U.S.                                                                          

  Calendar Yr. Exp. to 0                 0          0          0          0          0
  U.S.                                                                               
  -------------------- ----------------- ---------- ---------- ---------- ---------- ----------

  -------------------- ----------------- ---------- ---------- ---------- ----------- ----------
  **PSD Table**                                                                       

  **Country**          **Philippines**                                                

  **Commodity**        **Meat, Swine**                                    (1000 MT    
                                                                          CWE)(1000   
                                                                          HEAD)       

                       2002              Revised    2003       Estimate   2004        Forecast

                       USDA Official     Post       USDA       Post       USDA        Post
                       \[Old\]           Estimate   Official   Estimate   Official    Estimate
                                         \[New\]    \[Old\]    \[New\]    \[Old\]     \[New\]

  **Market Year                          01/2002               01/2003                01/2004
  Begin**                                                                             

  Slaughter            19500             19500      20000      21000      0           21500
  (Reference)                                                                         

  Beginning Stocks     11                11         11         0          11          0

  Production           1095              1095       1120       1145       0           1175

  Intra EC Imports     0                 0          0          0          0           0

  Other Imports        10                10         10         10         0           10

  TOTAL Imports        10                10         10         10         0           10

  TOTAL SUPPLY         1116              1116       1141       1155       11          1185

  Intra EC Exports     0                 0          0          0          0           0

  Other Exports        0                 0          0          0          0           0

  TOTAL Exports        0                 0          0          0          0           0

  Human Dom.           1075              1116       1100       1155       0           1185
  Consumption                                                                         

  Other Use, Losses    30                0          30         0          0           0

  TOTAL Dom.           1105              1116       1130       1155       0           1185
  Consumption                                                                         

  Ending Stocks        11                0          11         0          0           0

  TOTAL DISTRIBUTION   1116              1116       1141       1155       0           1185

  Calendar Yr. Imp.    0                 0          0          0          0           0
  from U.S.                                                                           

  Calendar Yr. Exp. to 0                 0          0          0          0           0
  U.S.                                                                                
  -------------------- ----------------- ---------- ---------- ---------- ----------- ----------