The Philippines seed market is projected to grow at a CAGR of 9.0% during the forecast period (2021-2026). The commercialization of seed especially, rice has not been much significantly affected by the impact of COVID-19, as compared to other crops, as rice seed demand has been always on the higher side. However, a substantial disruption in the functioning of both demand and supply, posing hurdles for all stakeholders including consumers, has been witnessed in the seed sector. The disruptions were majorly due to the measures taken by the government, which led to increasing losses in the seed sector. Rice is the most important staple crop in the country, followed by maize, dry beans, and potato. The main vegetable crops are eggplant, pumpkin, squash, gourds, tomato, and onion. The local crops with significant areas of harvest include cassava, sweet potato, pulses, and oilseeds. The main non-food crop in the country is tobacco. In order to make the country’s seed sector more competitive, the companies are calling for reforms. For instance, in 2018, one of the leading vegetable seed companies, East-west Seed, called for reforms in the seed industry to make the Philippines more competitive, as well as to make vegetable farming a more profitable occupation for smallholder farmers.
Key Market Trends
Development of New Varieties
In order to develop seeds with improved genetic traits and better pest resistance, the seed sector in the Philippines has been characterized by significant investments in R&D. The ongoing research and development in the Philippines seed market have boosted the new product developments on an extensive scale. For instance, in 2015, The National Seed Industry Council approved 14 new inbred and dry-seeded varieties developed by various research institutes. Till 2018, the country released 19 drought-tolerant rice hybrids for the rainfed lowlands, four for the uplands, and 15 for saline-prone environments. Apart from being more resilient, climate-smart varieties are also being developed in the country. The recently released drought-tolerant rice variety, NSIC Rc 282, offered encouraging results. The contribution of these varieties to the country's food security is even more crucial because the Philippines is one of the countries most vulnerable to climate change. So, these new innovations are more prone to address the challenges faced by Filipino farmers which is, in turn, driving the seed market.
Rice Dominates the Cereals Market
The rice seed market in the Philippines was recorded at 1,88,14,827 metric ton production in the year 2019. Non- hybrid seeds accounted for more than half of this market by volume, while the remaining was accounted for by hybrid seeds in 2019. Major rice-producing regions in the country are Central Luzon (18.7%), Western Visayas (11.3%), Cagayan Valley (11%), Ilocos Region (9.8%), Soccsksargen (7.5%), and Bicol region (6.8%). Nearly half of the rice varieties adopted in the country are by IRRI and more than one-fourth of the farmers in the country adopt Phil rice varieties. Privately bred rice varieties account for a minute percent. Less than 10% of adopted rice comprises privately bred varieties, of which the majority were bred by Bayer and SL Agritech. The Philippines, due to the lack of an effective seed delivery system, is not self-sufficient for rice production. Owing to this, it mainly depends on imports from neighboring countries, making it one of the world's biggest rice importers. In order to be self-sufficient in the near future, the government has been urging farmers to shift to hybrid rice seeds, as this would significantly contribute to achieving the 100% rice self-sufficiency level of the country by 2019. The DA had also planned to expand hybrid rice area up to 700,000 hectares in 2017 and as much as one million in 2020. Adopting hybrid seeds can help farmers become more competitive, by allowing them to produce more at a lower unit cost than inbred seeds, resulting in higher profit. However, despite these benefits, hybrid seed adoption is still low, which is restraining the market growth in the country.
The Philliphines seed industry is concentrated with few players the dominating majority of the market. SL-Agritech, Allied botanical, East-West Seed, Syngenta Group, Bayer’s Group, Pioneer Hi-Bred, and Kaneko Seeds are among the few dominant players, which offer both hybrid and non-hybrid seeds. The companies present in the country are focusing on different business strategies to expand their market share.
Reasons to Purchase this report:
- The market estimate (ME) sheet in Excel format
- 3 months of analyst support