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Publication Detail
CSPPS WP 2014-04: Marketing Margins in Philippine Fisheries Industry and Its Implication to Sectoral Poverty: An Empirical Analysis Anchored on the Milkfish Industry

This paper is intended for policymakers and officials of government agencies--specifically the Philippine Department of Agriculture, the Bureau of Fisheries and Aquatic Resources, and other agencies mandated to promote the welfare of the domestic fisheries industry. Tasked to steer direction of the Philippine fisheries industry, it is primal for these policymakers to know the following current-day startling industry facts: our fishermen posted the highest level of poverty incidence among the nine basic sectors despite our vast fishery resources, the dominant role our country plays in the global fishing industry and its contribution to the local economy. Thus, the policy objective is to determine the best policy option that will improve the income of fishermen without putting into jeopardy food security.

To determine potential reasons for the low incomes among fishermen, the dynamics governing the fisheries marketing system was studied using data from the BAS. It was found out that the price of fish is increasing and that the share of fishermen to prices paid for by consumers is decreasing. In addition, there is a strong evidence of market power imposed upon fish producers/fishermen by the retailers. The paper also attempted to review existing policies and legislation related to fisheries marketing and credit from the works of Hernando (2002).

Four policy alternatives were presented for consideration and these are: (1) status quo or maintaining of current conditions; (2) government intervention in the input and output market; (3) income transfer/area payments; and (4) development of market institutions like establishment of commodity board tasked to rationalize industry-specific infrastructures, market information, regulation and coordination, legal mechanisms, and specific market-based risk measures.

Advantages and disadvantages of each policy option were presented. Using effectiveness, sustainability, efficiency, flexibility, institutional constraints, and sector performance as criteria, it was found out that the best policy option to address the short term goal of addressing poverty among the fishermen without putting into jeopardy food security is government intervention in the input and output market.

It was also suggested that while addressing short-term objectives, foundations that will address the major problem of market inefficiency have to be simultaneously addressed. This includes industry rationalization through development of market institutions with private sector on the lead. In addition, market inefficiencies can be corrected so that the market power that exists can be reduced if not totally eliminated.

UPLB Center for Strategic Planning and Policy Studies
Authors Keywords
Tan, Reynold; fisheries; marketing margins; fish industry; conjecture; Department of Agriculture; Bureau of Fisheries and Aquatic Resources;
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Published in 2014 and available in the CSPPS-CPAf, UP Los BaƱos, College, Laguna or Downloaded 354 times since October 26, 2016
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