The Philippines is one of the fastest-growing economies in the world, with GDP growth exceeding 6% last year. It also boasts a young and rapidly growing population (a 2% population increase in 2018).

The country is highly exposed to tropical cyclones, with 20 typhoons occurring in 2018. These extreme weather events cause significant damage to the agricultural sector, which accounts for 9.7% of GDP.

Meat consumption in the Philippines is comparatively higher than most other countries in the Asia Pacific region, with per-capita consumption of beef at 3.6kg cwe/hd (carcase weight equivalent per head), and pigmeat at 18kg cwe/hd in 2018.

However, these figures still lag behind the EU average per capita consumption, which stands at 15.7kg cwe/hd for beef and 42.2kg cwe/hd for pigmeat.

Growth

Further strong growth is expected in terms of meat consumption, with the Filipino meat sector expected to expand from PHP204.9bn (€3.5bn) in 2018 to PHP264.5bn (€4.5bn) by 2023, at a compound annual growth rate (CAGR) of 5.2%.

The growing demand in a market that is a net importer presents opportunities for exporting countries like Ireland.

Demand for beef is almost double domestic production, meaning the Philippines relies on almost 200,000t cwe of imports (Figure 1).

Imports

Frozen beef accounts for 98% of the Philippines’ total beef imports. Buffalo meat from India accounts for 33% of these imports. This buffalo meat is only permitted for use in processing and not for retail sale. Australia is the next key supplier of frozen beef, accounting for 25% of imports.

Virtually all beef imports from both Australia and New Zealand are free from tariffs under the ASEAN-Australia-New Zealand Free Trade Agreement (AANZFTA).

Talks on an EU-Philippines free trade agreement officially started in December 2015 although it is expected to be a matter of years before an agreement is reached. Current tariff rates on EU beef and offal range from 3-10%.

Irish beef in the Philippines

The Philippines is currently the largest market for Irish beef outside of Europe, with exports to the market valued at €14.3m in 2018. In volume terms, this equates to 8,134t of beef. In addition, 10,887t of Irish beef offal was exported to the Philippines in 2018. This makes it the second most important non-EU offal market after Hong Kong, which took 15,883t in 2018.

Ireland gained market access to the Philippines in 2014, with our beef exports to the market reaching €14.9m in the first year of trade. This strong figure was helped partly by the closure of the Russian market in the same year.

To better understand this market, Bord Bia surveyed the top meat importers in the Philippines and found that the top three perceived strengths of Ireland were our food safety standards, our reputation for product quality and high animal welfare standards.

Pigmeat

Pigmeat consumption in the Philippines is forecast to exceed 2m tonnes cwe by the end of 2019, with imports making up 500,000t cwe of that figure.

Small-scale operations coupled with high feed and energy costs make the Philippines’ domestic pigmeat production less competitive versus imports, even when taking the import tariff, which can be up to 40%, into account.

Frozen pigmeat imports stood at 170,000t product weight (pw) in 2018, which is a 7.8% increase from the previous year. The EU is the main supplier of this product (100,000t pw) followed by Canada (41,000t pw) and the US (20,000t pw). Pig offal imports increased by over 18% from 2017 to 2018 to reach a total of 220,000t pw. Germany is the largest supplier of this offal at 45,000t pw.

African swine fever

The Philippines is currently free from African swine fever (ASF) and the government has taken action to maintain this status by banning imports from 19 countries including a number of its key suppliers, such as Belgium, China and, most recently, Germany.

The ban on all pigmeat shipments from Germany comes after 250kg of pigmeat originally sourced from Poland, which is currently suffering from an ASF outbreak, was shipped from Germany to the Philippines. This development leaves a significant gap in the market, particularly for offal, which will need to be satisfied.

Ireland’s pigmeat exports to the Philippines were valued at €7.8m in 2018, with volumes rising by 13% relative to 2017 at 8,674t.

Building an Irish presence in the Philippines

The EU has a market promotion fund that supports EU exports to other parts of the world. Earlier this year, Bord Bia commenced a €3.95m EU co-financed campaign, “European Pork and Beef: Excellence in Quality & Production Standards: 2019-2021”, which is focused on South Korea, Vietnam and the Philippines.

In Asia, Ireland has limited recognition but everyone involved in trade is aware of the EU and this campaign provides an opportunity to position Ireland as a key source of sustainable, high-quality food in these high-potential target markets.

Participation in trade shows and organising visits to Ireland for buyers to see our farms and industry is how long-term relationships and business are developed.