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Republic of the Philippines 3 ve

HOUSE OF REPRESENTATIVES = ?*'©
Quezon City .

SEVETEENTH CONGRESS
First Regular Session

House Bill No._@453

Introduced by REPRESENTATIVE ARTHUR C. YAP

EXPLANATORY NOTE

Corn is the second most important crop in the Philippines. About 14
million Filipinos prefer white corn as their main staple and yellow corn
accounts for about 50% of livestock mixed feeds. Some 600,000 farm
households depend on corn as a major source of livelihood. This does not
include transport services, traders, processors and agricultural input
suppliers who directly benefit from corn production, processing, marketing
and distribution. Corn is also processed into high value products, such as
corn starch, corn syrups, corn oil, gluten and snack foods.

However, according to the National Corn Program of the Department
of Agriculture (DA), on a national average, the corn production in the
Philippines is inefficient compared to Thailand, Argentina, United States,
and other major corn-producing countries. The Philippines lags behind with
its average corn productivity of 3.21 metric tons/hectare (mt/ha) as recorded
by DA. Despite the increasing demand for corn, (white corn consumed as
staple by around 12 million Filipinos and yellow corn wherein
approximately 70 percent is used as feeds for livestock), overall production
is low and inefficient.

Several factors affect this low-productivity of the corn industry in
the Philippines.

Government extension offices from the Department of Agriculture
(DA) play a vital role in technology information dissemination to corn
farmers in rural villages. However, many corn producing areas in remote
tural villages are hardly serviced by government agriculturists and
technicians. Seed company field technicians also provide information to
corn farmers, but it is generally limited to the product they are selling. There
is little or no extension service provided by agricultural state universities or
colleges (SUCs), while non-government organizations (NGOs) and
international agricultural research centers have not yet reached many of the
corn producing areas in the country


Then there is the problem of credit extension and services. The
majority of corn farmers lack sufficient capital for their farm operations and
have to borrow from private moneylenders on a charge-to-crop scheme with
a 10-20% interest rate. Corn farmers with loans from trader-financiers have
to sell their grains to the financiers despite the low prices they often get.
While formal credit programs and facilities were available from some
government and private banks, very few farmers used these sources because
they found the paper work too tedious and the requirements (especially
collateral) too stiff. Farmers also noted that financial institutions only extend
agricultural loans to farmer associations, not to individual farmers.

The lack of appropriate and sufficient infrastructural support also
contributes significantly to the aggravation of the problem. While road
networks in the municipalities may be accessible by all kinds of land
transportation, most villages, particularly the interior ones, are not accessible
to motor vehicles, especially during the rainy season. Farmers in these
villages use animal drawn carts to haul their products to the nearest market.
Trucking services (transportation costs) are often charged or shouldered by
the farmers. Moreover, many lands planted to corn have no major irrigation
projects or facilities, and farmers depend largely on rainfall as the source of
water for their crops. A few areas with irrigation, obtain most of their water
from springs and rivers, but save it for high value crops like rice or
vegetables rather than corn. Post-harvest facilities are limited to solar dryers
(usually cement pavement), mechanical shellers, and mills. Since most
grains are sold immediately after drying, storage facilities do not receive
high priority as a post-harvest requirement. In other corn producing areas,
storage facilities do not exist.

Most corn farmers tend to have small farms of up to 2.0 ha only. They
also characteristically earn most of their income from corn production and
other agricultural enterprises (usually as hired labor in other farms) rather
than from non-agricultural or non-farm activities. Thus, their lives and their
families depend heavily on the conditions of the corn industry.

To increase productivity and incomes of corn farmers, this bill aims to
establish productivity improvement programs, provide the needed
infrastructure support, enhance research and development on product
diversification, provide human resource development and extension services,
and provide financial assistance to small corn farmers and farm workers.

The programs seek to develop the country’s corn sector into one that
is farmer-focused and agribusiness-oriented, and transform corn farmers and
farm workers into agri-entrepreneurs through productivity enhancement
projects and human resource development activities. They include
mechanization of corn-based farming systems, corn variety development,
corn production optimization, and farmers are more assured with financial
and technical assistance. Most importantly, these projects provide
opportunities for the sector in building and strengthening their network and
linkages, making production more productive and efficient.


In view of the foregoing, the immediate consideration and approval of
the bill is earnestly urged.

ARTHUR C. YAP
Representative


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

SEVENTEENTH CONGRESS
First Regular Session

House Bill No. _3453

Introduced by REPRESENTATIVE ARTHUR C. YAP

AN ACT
PROMOTING AND SUPPORTING THE
DEVELOPMENT OF THE CORN INDUSTRY AND FOR

OTHER PURPOSES
Be it enacted by the Senate and House of Representatives of the Philippines
in Congress assembled.

SECTION 1. Short Title. - This Act shall be known as the ‘Corn
Industry Development Act of 2016.”

SECTION 2. Declaration of Policy. - It is hereby declared the
policy of the State to promote and support the development of the corn
industry, increase the incomes of corn farmers and farm workers through
improved productivity, product diversification and employment generation.

For these purposes, the State shall establish productivity improvement
programs, provide the needed infrastructure support, enhance research and
development on product diversification, provide human resource
development and extension services, and provide financial assistance to

small corn farmers and farm workers.


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SECTION 3. Productivity Improvement Programs. - To boost the
production of corn, and increase the incomes of corn farmers and farm
workers, the following Productivity Improvement Programs shall be
implemented:

a) Farm Support Program - The Department of Agriculture (DA) shall
make available a support program which shall include, among others,
the provision of socialized credit, and a farm management and technical
assistance services.

(i) Socialized credit shall be made available, through the Land Bank of
the Philippines (LBP), for the acquisition of farm inputs, farm
machineries and implements necessary for the continuous production
of corn: Provided, that the loans shall be made available to corn
farmers duly registered with the DA: Provided, further, that the
lender shall have a lien on the harvest of farmers who obtained the
loan until the crop loan is fully paid: Provided, finally, that farmer-
borrowers cannot be granted another loan until existing loans are
fully paid.

(ii) Farm Management and Technical Assistance Services - The DA,
the Department of Labor and Employment (DOLE), the Technical
Education and Skills Development Authority (TESDA), state
universities and colleges (SUCs), and other concerned private and
non-government organizations (NGOs), shall formulate and
implement a deployment program of agricultural engineers,
agriculturists and farm technicians for the provision of farm

management and technical assistance services to corn farmers.


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b) Farm Mechanization Program - Corn farmers and farm workers shall
be encouraged and trained to utilize appropriate agricultural machineries
and equipment necessary for the efficient planting, cultivation, care and
maintenance, harvesting and handling of and corn and its by-products.

The DA, in partnership with local government units (LGUs),
consistent with the provisions of Republic Act No. 10601, otherwise
known as the ‘Agricultural and Fisheries Mechanization Law’, shall:

(i) Introduce and expand the use of machineries for the different stages
of and corn farming; and,

(ii) Formulate and implement a Corn Farm Mechanization Program at
the barangay level.

To develop and deploy appropriate machineries and equipment, the
DA, through its research centers, in collaboration with the Philippine
Center for Post-Harvest Development and Mechanization, the Bureau of
Agricultural Research, SUCs, other concerned government agencies, and
industry stakeholders, shall formulate and conduct research development
and extension programs for corn farm mechanization and engineering.

SECTION 4. Research and Development. - The DA, in coordination
with the Department of Science and Technology (DOST), as well as relevant

SUCs, and government research and development institutions, and the

private sector, shall intensify researches on high yielding or flood resistant

corn varieties; pest control and prevention; latest farming and harvesting
technologies; soil analysis and fertility mapping of corn areas; weather
monitoring and climate change adaptation measures; and other viable

products that can be derived from corn.


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SECTION 5. Extension Services. - Extension services that can be
provided shall include, but not limited to, provision of technical assistance
and advice, conduct of tests, propagation, and dissemination of high yielding
varieties, and operation of demonstration farms.

SECTION 6. Human Resources Development. - The DOLE, in
collaboration with the DA, the Commission of Higher Education (CHED),
the TESDA, the Professional Regulation Commission (PRC), and the private
sector, shall formulate and implement a Human Resources Development
(HRD) Master Plan for the corn industry which shall include, but not
limited to, the following:

a) Capacity-building, skills trainings, institutional strengthening of com
industry workers and small farmers and their organizations to actively
contribute in productivity and competitiveness;

b) Conduct of capability trainings or attendance to local or international
trainings and seminars by corn farmers and farm workers on the latest
technologies related to corn farming and production of other products
from corn;

c) Formulation and implementation of competency standards and training
regulations for technical vocational education and training for the corn
industry by the TESDA;

d) Scholarship programs for the underprivileged but deserving college and
post-graduate students who are taking up courses in relevant fields of
discipline in SUCs which have programs in agriculture, agricultural

engineering and mechanics, and chemical engineering; and for


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e)

vocational courses and skills development for farmers and farm
technicians and skilled corn farm workers; and,

Upgrading of facilities, faculty development and strengthening of the
on-the-job training programs for agri-based higher education institutions
in corn areas towards the production of highly employable and globally
competitive graduates needed by the corn industry.

SECTION 7. Infrastructure Support. - To facilitate the transport,

marketing and export of corn produce and other products derived therefrom,

and complement productivity improvement measures in this Act, transport

infrastructures, farm-to-market roads and irrigation facilities shall be

provided.

a)

b)

c)

Transport Infrastructures - The National Economic Development
Authority (NEDA), the Department of Transportation and
Communications (DOTC), the Department of Public Works and
Highways (DPWH), and the Philippine Ports Authority (PPA),shall
include in their annual Development Plans and Priority Investment
Programs the immediate construction and/or improvement of existing
transloading ports for coast-wide transport, sale or export of corn
products in key corn producing areas.

Farm-to-Market Roads - The NEDA, the DA, the DPWH, and
concerned local government units (LGUs), shall include in their annual
Priority Investment Programs the immediate construction and/or
rehabilitation of farm-to-market roads in key corn producing areas.
Irrigation - The National Irrigation Administration (NIA), the Bureau

of Soils and Water Management (BSWM), and concerned LGUs, in


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coordination with the DA, shall construct appropriate, efficient and cost-
effective irrigation facilities, pump and other pressurized irrigation
systems, rain capture and water impounding facilities in cor producing
areas. The DA and NIA shall include in its annual budget the item or
provision on construction and rehabilitation of irrigation facilities, rain
capture and water impounding facilities in corn producing areas.

SECTION 8. Classification and Regulation of Supply of Corn. -

The DA, in the exercise of its regulatory authority, shall classify imported
corn according to their appropriate classification when imported at a time
that domestic productions are sufficient to meet domestic requirements. The
Bureau of Customs (BOC) shall require importers or consignees to secure

form the DA the classification of the imported corn prior to its release.

SECTION 9. Appropriation. - In the succeeding years from the

effectivity of this Act, the amount of Two billion pesos (P 2,000,000,000.00)
shall be appropriated annually and to be allocated as follows :

a) Twenty percent (20%) for socialized credit under the Farm Support and

farm Mechanization Programs;

b) Fifteen percent (15%) for research and development, capability-building

and technology transfer activities under Research and Development,

Extension Services and Human Resources Development;

c) Fifteen percent (15%) for scholarship grants to be provided under

paragraph (d) of Section 6 of this Act; and,

d) Fifty percent (50%) for infrastructure support programs.

In the identification and prioritization of specific programs and

projects, the DA shall conduct prior consultations with corn farmers and


farm workers, and producers of corn by-products. The Department shall
issue the necessary guidelines for this purpose.

SECTION 10. Implementing Rules and Regulations. - The DA, in
consultation with concerned government agencies and corn industry
stakeholders, shall issue the implementing rules and regulations of this Act
within ninety (90) days from the effectivity of this Act.

SECTION 11. Separability Clause. - If any provision of this Act is
declared unconstitutional, the validity of the remaining provisions hereof
shall remain in full force and effect.

SECTION 12. Repealing Clause. - All laws, decrees, executive
orders and rules and regulations or parts thereof inconsistent with any
provision of this Act are hereby repealed, modified or amended accordingly.

SECTION 13. Effectivity Clause. - This Act shall take effect after
fifteen (15) days from its publication in the Official Gazette or in at least two
(2) newspapers of general circulation.

Approved.