CATTLE INDUSTRY ROAD MAP

VALUE OF LIVESTOCK & POULTRY at current prices (billion pesos)

Source : DA-BAS

Industry Situation

Livestock/Poultry 2005 2006 2007 2008 2009Hog 126.98 127.12 134.60 152.15 161.15

Cattle 15.71 15.88 15.67 17.49 18.65Carabao 6.49 6.78 7.24 8.14 8.94Goat 5.09 5.22 5.34 5.87 6.81Dairy 0.34 0.37 0.39 0.41 0.46Total Livestock 154.61 155.37 163.24 180.98 196.02Chicken 79.69 81.74 87.41 97.86 107.69Chicken Eggs 20.82 22.95 25.41 27.93 31.18Duck 2.78 2.62 2.50 2.63 2.48Duck Eggs 2.99 2.86 2.92 2.81 2.97Total Poultry 106.28 110.17 118.24 131.23 144.32GRAND TOTAL 260.89 265.54 281.48 312.21 340.34

1976-2010 CATTLE INVENTORY

Source : DA-BAS

Industry Situation

1976 1980 1985 1990 1995 2000 2005 2010Backyard 1,338,740 1,473,450 1,492,830 1,437,950 1,835,130 2,285,054 2,386,051 2,432,475Commercial 397,880 438,410 293,560 191,280 185,921 193,799 161,905 163,556Total 1,736,620 1,911,860 1,786,390 1,629,230 2,021,051 2,478,853 2,547,956 2,596,031

-

500,000

1,000,000

1,500,000

2,000,000

2,500,000

3,000,000

1976 1980 1985 1990 1995 2000 2005 2010

No. of Hd.

year

Backyard

Commercial

2001-2010 CATTLE INVENTORY

Source : DA-BAS

Industry Situation

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010Backyard 2,307,371 2,364,133 2,379,857 2,427,963 2,386,051 2,356,985 2,408,185 2,408,733 2,401,001 2,432,475Commercial 188,230 183,686 177,183 165,323 161,905 162,755 157,664 157,759 164,661 163,556TOTAL 2,495,601 2,547,819 2,557,040 2,593,286 2,547,956 2,519,740 2,565,849 2,566,492 2,565,662 2,596,031

source : DA-BAS

-

500,000

1,000,000

1,500,000

2,000,000

2,500,000

3,000,000

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

no

. o

f h

ead

year

Cattle Inventory

Backyard

Commercial

INVENTORY GROWTH RATE

Industry Situation

2002 2003 2004 2005 2006 2007 2008 2009 2010

Backyard 2.46 0.67 2.02 (1.73) (1.22) 2.17 0.02 (0.32) 1.31 Commercial (2.41) (3.54) (6.69) (2.07) 0.52 (3.13) 0.06 4.38 (0.67)

(8.00)

(6.00)

(4.00)

(2.00)

-

2.00

4.00

6.00

2002 2003 2004 2005 2006 2007 2008 2009 2010

%

year

Inventory Growth Rate

Backyard

Commercial

PHILIPPINE PER CAPITA CONSUMPTION

Per Capita Consumption (kg)

Pork 9.15Chicken 7.90Chicken Egg 3.17Beef 1.25Carabeef 0.21Goat 0.05

Source : BAS 2009

Industry Situation

COMPARATIVE PER CAPITA CONSUMPTION (KG)

Country Beef Chicken Pork

U S A 28.36 27.46 21.14

Australia 35.16 30.56 20.38

Philippines 1.25 7.90 9.15

Industry Situation

Source : DA-BAS

Industry Situation

2001 2002 2003 2004 2005 2006 2007 2008 2009

Beef (9.22) 1.37 (0.02) 4.96 (9.92) (1.19) 10.78 5.09 (1.35)

Pork 3.46 5.44 4.13 (1.01) 3.33 10.66 4.29 1.18 1.62

Dressed Chicken 8.79 6.86 1.48 5.65 (5.21) 6.46 13.31 9.23 3.74

(15.00)

(10.00)

(5.00)

0.00

5.00

10.00

15.00

% Growth

COMPARATIVE SUPPLY GROWTH RATE

Beef Pork Dressed Chicken

PERCENTAGE SHARE OF BACKYARD & COMMERCIAL CATTLE FARMS

Source : DA-BAS * no breakdown for 1970-75

Production Performance: Present

1976-79* 1980-89 1990-99 2000-09Backyard 75.44 81.79 90.54 93.26Commercial 24.56 18.21 9.46 6.74

EXTRACTION AND OTHER EXTRACTION AND OTHER PERFORMANCE INDICATORSPERFORMANCE INDICATORS

Source : DA-BAS

Production Performance: Present

PARTICULARS 2005 2006 2007 2008 2009Total Population 2,547,956 2,519,740 2,565,849 2,566,492 2,565,662 Total Breeders 1,411,192 1,392,636 1,452,008 1,434,626 1,473,561 Backyard 1,312,073 1,293,627 1,357,265 1,333,532 1,368,715 Commercial 99,119 99,009 94,743 101,094 104,846 Total Extraction 729,261 780,625 780,501 789,541 856,741 Retention (28,216) 46,109 643 (830) 30,369 Slaughter 736,901 714,355 759,430 767,935 808,334 Mortality 20,576 20,161 20,428 22,436 18,038% Extraction Rate 28.62 30.98 30.42 30.76 33.39 % Retention (3.87) 5.91 0.08 (0.11) 3.54 % Slaughter 101.05 91.51 97.30 97.26 94.35 % Mortality 0.81 0.80 0.80 0.87 0.70

Source: Del Monte Philippines, Inc.

COMPARATIVE GROWTH RATECOMPARATIVE GROWTH RATE

Production Performance: Present

Ave. Daily Gain (kg)

Finished Weight (kg)

Local Feeder Cattle 1.2 318

Imported Feeder Cattle 1.0 405

SLAUGHTER PERFORMANCESLAUGHTER PERFORMANCE

* * DEALCO Farms (2004)DEALCO Farms (2004)

** ** BAI-APDC (2003)BAI-APDC (2003)

Production Performance: Present

Upgraded Local Cattle*

Native Cattle**

Ave. Slaughter Wt., (kg)

415 318

Ave Carcass Wt., (kg)

230 161

Dressing % 55.42 50.6

Volume of Local Production & Imports*Volume of Local Production & Imports*

* Thousand Metric tons Source : DA-BASThousand Metric tons Source : DA-BAS

Market Supply Distribution : Present

2005 2006 2007 2008 2009PORK

o Local Prod'n. 1,415.04 1,564.96 1,616.72 1,605.81 1,628.84o Imports 31.32 35.55 52.38 83.01 87.28

TOTAL 1,446.36 1,600.51 1,669.10 1,688.82 1,716.12Dressed Chicken

o Local Prod'n. 623.50 658.04 745.40 812.32 826.68o Imports 26.21 33.63 38.34 43.76 61.44

TOTAL 649.71 691.67 783.73 856.08 888.12BEEF

o Local Prod'n. 172.76 167.48 178.04 184.36 189.51o Imports 30.83 33.70 44.81 49.84 41.54

TOTAL 203.59 201.18 222.85 234.20 231.05CARABEEF

o Local Prod'n. 77.11 84.47 110.20 101.04 98.97o Imports 64.17 60.40 62.13 63.44 45.86

TOTAL 141.28 144.87 172.33 164.48 144.83

COMMODITYYEAR

Market Supply Distribution : Present

Percent Sufficiency in Meat Percent Sufficiency in Meat ProductsProducts

2005 2006 2007 2008 2009PORK

o Local Prod'n. 98.23 98.06 97.22 97.41 94.64o Imports 1.77 1.94 2.78 2.59 5.36

Dressed Chickeno Local Prod'n. 95.80 94.89 94.21 94.09 92.57o Imports 4.20 5.11 5.79 5.91 7.43

BEEFo Local Prod'n. 82.15 79.88 74.83 72.32 78.08o Imports 17.85 20.12 25.17 27.68 21.92

CARABEEFo Local Prod'n. 16.78 28.50 43.62 36.02 53.66o Imports 83.22 71.50 56.38 63.98 46.34

COMMODITYYEAR

Market Supply Distribution : Present

Domestic Production and Domestic Production and ImportsImportsGrowth Rate (%)Growth Rate (%)

Source : DA-BAS

Prod. Imp. Prod. Imp. Prod. Imp. Prod. Imp.2005 3.62 (8.12) (1.30) 27.60 (3.61) (34.12) (3.28) (1.86)2006 10.59 13.53 5.50 28.30 (1.19) (3.06) 9.39 (5.87)2007 3.31 47.35 0.60 14.00 6.31 32.97 30.65 2.852008 (0.66) 58.48 11.90 14.10 1.12 11.22 (10.02) 2.112009 1.43 5.14 1.77 40.42 2.79 (16.65) (2.05) (27.70)

CARABEEFYEAR

PORK D. CHICKEN BEEF

Challenges Challenges

ProspectsProspects ImportsImports Production PotentialProduction Potential Genetic ImprovementGenetic Improvement Jobs and Income GenerationJobs and Income Generation

VisionVision

Local beef cattle production Local beef cattle production catering to the high-end markets. catering to the high-end markets.

Immediate ConcernsImmediate Concerns

Increasing finished weight per unit of Increasing finished weight per unit of production by finishing local cattle in theproduction by finishing local cattle in the feedlot.feedlot.

Sustaining the overall population growthSustaining the overall population growth and arrest the decline of the commercialand arrest the decline of the commercial sector.sector.

Achieving a total system of productionAchieving a total system of production and marketing.and marketing.

STRATEGIESSTRATEGIES

Integrating:Integrating: Genetic Improvement Herd Build-up Financing Markets and distribution

GENETIC IMPROVEMENT PROGRAM Purebreeding/Conservation: Private

Sector Seedstock and Government Stock Farms as Nucleus Operations

Crossbreeding: Ranchers/Commercial Raisers as Multiplier Farms

Terminal Crossbreeding: Backyard Production/Operations

STRATEGIESSTRATEGIES

Genetic Improvement Program (GIP)Genetic Improvement Program (GIP)

Since almost 94% of the population of cattle is in the Since almost 94% of the population of cattle is in the backyard,backyard,the following programs shall be promoted to preserve the following programs shall be promoted to preserve fertilityfertility& improve genetically the cattle in terms of its size & & improve genetically the cattle in terms of its size & weights. The overall GIP strategy shall be as follows:weights. The overall GIP strategy shall be as follows:

PurebreedingPurebreeding: Private Stud Breeders & Government : Private Stud Breeders & Government Stock Stock Farms as Nucleus Farms for commercial breeders. Farms as Nucleus Farms for commercial breeders. GovernmentGovernment will pursue purebreeding Nellore, Medium-Sized will pursue purebreeding Nellore, Medium-Sized Brahman, Brahman, Simmental & Simbrah - assuring fair competition.Simmental & Simbrah - assuring fair competition. Private stud breeders shall be accredited as nucleus Private stud breeders shall be accredited as nucleus farms. Thesefarms. These nucleus farms shall do their own purebreeding program. nucleus farms shall do their own purebreeding program. TheyThey shall develop an appropriate distribution & transfer shall develop an appropriate distribution & transfer scheme thatscheme that will provide genetically improved stocks in the multiplier will provide genetically improved stocks in the multiplier farmsfarms that would ultimately end at the backyard production that would ultimately end at the backyard production system. system.

Crossbreeding:Crossbreeding: Ranchers & Multiplier Farms for the Ranchers & Multiplier Farms for the Backyard Raisers: Crossbreeding of Backyard Raisers: Crossbreeding of Bos indicus x Bos Bos indicus x Bos taurus taurus (Nellore/Brahman x Simmental/Simbrah).(Nellore/Brahman x Simmental/Simbrah).

The ranchers or multipliers shall produce crossbred The ranchers or multipliers shall produce crossbred beefbeef cattle that will be promoted for the backyard cattle that will be promoted for the backyard production.production. These ranches/multiplier farms shall distribute These ranches/multiplier farms shall distribute improvedimproved crossbred to the backyard following the nucleus crossbred to the backyard following the nucleus plasmaplasma or the big brother-small brother schemes.or the big brother-small brother schemes.

Terminal Crossbreeding:Terminal Crossbreeding: Upgrading Upgrading Backyard cattleBackyard cattle x Nellore, Brahman, Simmental and Simbrah x Nellore, Brahman, Simmental and Simbrah using using bulls from the multiplier farms & AI.bulls from the multiplier farms & AI.

UNAIPUNAIP – The Unified National Artificial – The Unified National Artificial InseminationInsemination Program (UNAIP) of BAI shall expand the on-Program (UNAIP) of BAI shall expand the on-going going initiative, intensifying the institutional capability initiative, intensifying the institutional capability of theof the LGUs along the GIP strategic directions. It shall LGUs along the GIP strategic directions. It shall put input in place AI infrastructure and mechanism to ensureplace AI infrastructure and mechanism to ensure sustainability by way of improving essential sustainability by way of improving essential integrals,integrals, including development of human resource, including development of human resource, provision ofprovision of equipment and strengthening institutional equipment and strengthening institutional linkages,linkages, particularly the academe and the private sector particularly the academe and the private sector – the– the stud breeders and ranchers.stud breeders and ranchers.

HERD BUILD-UP PROGRAM Multi-Livestock Development Loan

Program (MLDLP) Save the Herd Program Animal Infusion

FINANCING PROGRAM Quedancor, LBP, DBP & ACEF PL 480

STRATEGIESSTRATEGIES

New FinancingNew Financing MLDLPMLDLP - The Multi-Livestock Development Loan - The Multi-Livestock Development Loan Program (MLDLP) streamlined and pursued more Program (MLDLP) streamlined and pursued more vigorously and expanded for the HBUP – to include the vigorously and expanded for the HBUP – to include the ranchers.ranchers. QuedancorQuedancor - Tapped to provide credit financing for the - Tapped to provide credit financing for the backyard GIP and HBUP programs:backyard GIP and HBUP programs:

1. Bull Exchange – 1:25-301. Bull Exchange – 1:25-302. Herd Increase – 1:252. Herd Increase – 1:25

ACEF, LBP & DBPACEF, LBP & DBP - GFIs enjoined to finance the - GFIs enjoined to finance the stockyards, “hotels,” slaughterhouses, cutting floors stockyards, “hotels,” slaughterhouses, cutting floors and cold chains.and cold chains. PL 480PL 480 - Make use of the commodity loan for animal & - Make use of the commodity loan for animal & semen infusion.semen infusion.

NEW MARKETS & DISTRIBUTION Development of Grades and Standards Meat Importers, Processors & Wholesalers Cold Chain & Transport System Livestock Hotels & Stockyard Complex Slaughterhouse & Cutting Floors Market Information System E- Commerce

STRATEGIESSTRATEGIES

Importers sourcing their growth locally;Importers sourcing their growth locally; Post-harvest facilities allowing separationPost-harvest facilities allowing separation

at slaughter to cut, box and freeze – and at slaughter to cut, box and freeze – and

facilitate transport;facilitate transport; Wholesalers buying directly from Wholesalers buying directly from

producers;producers; “ “Oksyon” Markets & Livestock “Hotels” Oksyon” Markets & Livestock “Hotels”

for culls,for culls,

growers/finishers, and breeders. growers/finishers, and breeders.

A Total Market and Distribution SystemA Total Market and Distribution System

Production

Livestock Oksyon Mkt

Livestock Hotel

Feedlot/Fattening

Slaughter

Cutting Floors

InstitutionalBuyer

MITASpecial Cuts

PAMPIMfg Grade

Wet Mkt

Processing

A New Market and Distribution SystemA New Market and Distribution System

BAI- Marketing Division

TARGETSTARGETS

Stockyards and “hotels”Stockyards and “hotels” - set up in strategic - set up in strategic location.location. FeedlotsFeedlots - finishing local cattle to increase weights at - finishing local cattle to increase weights at slaughter - at least 350 for native cattle, 420 for slaughter - at least 350 for native cattle, 420 for upgrades and upgrades and 450 for imported live imports.450 for imported live imports. Accredit stud and multiplier breedersAccredit stud and multiplier breeders - production - production of bulls of bulls for the 1,492,892 breeder base - target around 59,715 for the 1,492,892 breeder base - target around 59,715 bulls.bulls.

Breeder InfusionBreeder Infusion - To produce the bulls, some - To produce the bulls, some 167,692 cows are required. As the commercial sector 167,692 cows are required. As the commercial sector has only 114,447 breeders, there is a gap of 53,245 has only 114,447 breeders, there is a gap of 53,245 females.females.

Grazing LandGrazing Land - The existing cow population, - The existing cow population, requires a total of 572,235 hectares of grazing land. requires a total of 572,235 hectares of grazing land. The current land under cattle should be preserved forThe current land under cattle should be preserved for this purpose. this purpose.

POLICIESPOLICIES Promote local sourcing;Promote local sourcing; “ “Commercialization” of the smallhold;Commercialization” of the smallhold; Strengthening of support services;Strengthening of support services;

animal health, standards, environmentanimal health, standards, environment

Coordination Coordination (DENR, DAR, NCIP, DILG)(DENR, DAR, NCIP, DILG)

& Linkages & Linkages (LGUs & Private sector)(LGUs & Private sector) Structural Provision:Structural Provision:

Breeder Accreditation BoardBreeder Accreditation Board Beef Cattle Development CenterBeef Cattle Development Center