AN ECONOMIC ANALYSIS OF PHILIPPINE DOMESTIC TRANSPORTATION&. 1, 0- VOLUME II THE DEMAND FOR TRANSPORTATION: COMMODITY FLOWS AND PASSENGER MOVEMENTS

Preparedfor:

THE NATIONAL ECONOMIC COUNCIL OI0 THE REPUBLIC OF THE PHILIPPINES

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/T AN ECONOMIC ANALYSIS OF PHILIPPINE DOMESTIC TRANSPORTATION

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January 1057

FINAL REPORT

AN ECONOMIC ANALYSIS OF PHILIPPINE DOMESTIC TRANSPORTATION

VOLUME II THE DEMAND FOR TRANSPORTATION: COMMODITY FLOWS AND PASSENGER MOVEMENTS

S R I Project No. IU-1554

Preparedfor: THE NATIONAL ECONOMIC COUNCIL OF THE REPUBLIC OF THE PHILIPPINES

FOREWORD

A comprehensive study of Philippine domestic transportation was undertaken in 1956 by SLanford Research Institute for the National Economic Council of the Rep. ic of the Philippines. The study was conducted to provide information and recommendations helpful to the Council in formulating legislative, administrative, and financial policies and measures designed to increase the contribution of the domestic transportation system to the economic development of the Philippines.

All types and aspects of domestic transportation--land, water, and air--were studied by the Institute, except local transportation within individual municipalities, cities, and metropolitan areas. An investigation of commodity and passenger movements which create demands for transportation services was also included as an essential part of the analysis.

The report comprises seven volumes:

I INTRODUCTION, CONCLUSIONS AND RECOMMENDATIONS for the entire study, and AN ACTION AND INVESTMENT PROGRAM

II THE DEMAND FOR TRANSPORTATION: COMMODITY FLOWS AND PASSENGER MOVEMENTS

III DOMESTIC WATER TRANSPORTATION AND PORTS

IV LAND TRANSPORTATION: ROADS AND MOTOR VEHICLES

V LAND TRANSPORTATION: RAILROADS

VI AIR TRANSPORTATION

VII THE ROLE OF GOVERNMENT IN TRANSPORTATION

This volume (Volume II) contains an analysis of intraprovincial and interprovincial commodity movements which influence domestic trans­ port requirements and an analysis of geographic and economic factors which affect the demand for passenger transportation.

v TABLE OF CONTENTS

Section Page

FRONTISPIECE . . . . ii

FOREWORD ...... V

I INTRODUCTION ...... * . * p * . 3

II SUMMARY AND CONCLUSIONS...... 7

Export Commodities...... 7

The Movement of Domestic Commodities ...... * * . 8 The Movement of Imports and Manufactures . . 10 Traffic Areas...... 1.1 Passenger Movements...... 12.

III AGRICULTURAL COMMODITIES--FOOD CROPS...... 15

The Movement of Food Crops...... 15 Palay and Rice...... 19

Methods of Marketing ...... 19 Origin and Destination of Palay and Rice, 1955 . . . . 22 Future Developments in Palay and Rice, 1957-1966 . . . 29 Transportation Needs and Improvements in the Movement of Palay and lice...... 35 Appendixes to Falay and Rice...... 39

Corn...... 83

Methods of Marketing ...... 83 Origin and Destination of Corn, 1955...... 84 Future Developments in Corn, 1957-1966...... 89 Transportation Needs and Improvements in the Movement of Corn...... 92 Appendixes to Corn...... 95

vii TABLE OF CONTENTS (Continued)

Section Page

IV AGRICULTURAL COMMODITIES--COMMERCIAL CROPS ...... 125

Coconut and Coconut Products ...... 125

Methods of Marketing Copra ...... 125 Methods of Marketing Desiccated Coconut...... 127 Origin and Destination of Copra, 1955...... 130 Transportation Needs and Improvements in the Movement of Copra ...... 151 Appendix to Copra...... 159

Sugar and Sugar Products...... 167

Methods of Marketing Sugar ...... 168 Methods of Marketing Molasses...... 169 Origin and Destination of Sugar Cane, Crop Year, 1954-1955...... 172 Origin and Destination of Centrifugal Sugar, Crop Year, 1954-1955...... 174 Origin and Destination of Molasses...... 179 Future Developments in Sugar and Molasses...... 183 Transportation Needs and Improvements in the Movement of Sugar and Sugar Products...... 184

Fibers: Abaca, Ramie, and Maguey,...... 187

Methods of Marketing Abaca...... 187 Origin and Destination of Abaca Fiber, 1955...... 190 Origin and Destination of Baled Abaca Fiber to Export Ports, 1955...... 199 Future Developments in Abaca...... 203 Transportation Needs and Improvements in Relation to the Movement of Abaca...... 204 Appendix to Fibers...... 209

viii TABLE OF CONTENTS (Continued) ction Page

IV (Continued)

Tobacco and Tobacco Products...... 217

Methods of Marketing Tobacco ...... 217 Origin and Destination of Virginia Leaf Tobacco, 1955 and 1956...... 219 Origin and Destination of Cigar Leaf or Native Tobacco, 1955...... 223 Future Developments in Tobacco...... 228 Transportation Needs and Improvements in the Movement of Tobacco...... 229 Appendix to Tobacco and Tobacco Products ...... 233

V FOREST AND LUMBER PRODUCTS...... 241

Present Producing Areas...... 241 Forest Areas and Their Potential...... 243 Lumber Production and Marketing...... 247 Distribution and the Manila Market...... 249 Transportation and the Lumber Industry ...... 253

Access Roads and Coastal Landings...... 253 Domestic Transportation...... 254

Conclusion...... 257

VI MINERAL PRODUCTION, INCLUDING CEMENT AND FERTILIZER. . . 271

Cement ...... 271 Coal ...... o...... 273 Other Nonmetallic Mineral Production and Fertilizer. . . 273

Pyrites and Fertilizer...... 273 Miscellaneous Nonmetallic Minerals ...... 275

ix TABLE OFCONTENTS (Continued)

Section Page

VI (Continued)

Base Metal Production ...... 275

Iron and Chromite...... 275 Copper and Other Ores...... 277 Gold and Silver Mining...... 278

Conclusion: The Role of Transport and Future Mineral Prospects...... 278

Future Mineral Prospects...... 280 . Domestic Mineral Transport...... 282

VII MANUFACTURING...... 295

Processing Primary Products...... 296 Manufacture of Heavy Commodities...... 297 Consumer Goods...... 297 Handicraft Industries...... 300

VIII TRADE CENTERS, TRIBUTARY AREAS, AND THE DISTRIBUTION PATTERN...... 303

The Distribution of Imports and Other Products. . . . 303 Petroleum Distribution...... 307 Trade Centers and Tributary Areas...... 311

The National Center--Manila...... 313 Interregional Centers...... 313 Major, Secondary, and Minor Centers...... 314

Conclusion: The Role of Transport and the Development of Trade Centers...... 316

IX PASSENGER MOVEMENT...... 335

The Bases for Passenger Movement...... 335 The Traffic Flow Pattern...... 337 TABLE OF CONTENTS (Continued)

List of Tables

Number Page

Section III

III-I Palay: Percent of Total Production by Region and Province, 1955...... 24

III-II Domestic Rice Requirements, 1940-1966 ...... 30

III-III Corn: Percent of Total Production by Region and Province, Crop Year 1954-1955...... 85

III-IV Domestic Corn Requirements, Philippines, 1940-1966. 91

Appendix Tables, Section III

III-A-I Palay: Percent Disposition by Region, 1955 . 40

III-B-I Percentage Distribution of Milling of Rice by Method Used and by Region, 1954-1955...... 46

III-C-I Palay and Rice: Surplus and Deficit Production by Province, Crop Year 1954-1955 ...... 51

III-C-II Estimated Surplus and Deficit Production of Palay and Rice Combined by Province, 1955 ...... 54

I II-C-III Inward and Outward Shipments of Rice, Manila, 1955. 59

III-C-IV Shipments of Rice to Cebu by Province and Port, 1955 63

III-D-I Palay: Total Production, Per Capita Production, Yield Per Hectare, and Area Planted, 1939-1966. 70

III-E-I Palay: Production by Region and Province, 1938-1956 73

III-E-II Palay: Area Planted by Region and Province, 1938-1956...... 75

I II-E-III Palay: Percent of Total Area Planted by Region and Province, 1938-1956 ...... 77

xi TABLE OF CONTENTS (Continued)

Number Page

Appendix Tables, Section III (Continued)

III-E-IV Palay: Yield Per Hectare by Region and Province, 1938-1956...... 78

III-E-V Palay: Percent of Total Production by Region and Province, 1938-1956...... 79

III-F-I Percent Disposition of Shelled Corn by Region and Province ...... 96

III-G-I Corn: Surplus and Deficit Production by Region and Province, Crop Year 1954-1955...... 103

III-G-II Shipments of Corn to Cebu by Province and Port, 1955 106

III-G-III Shipments of Corn to Manila by Region and Province, 1955 ...... 111

III-H-I Corn: Production by Region and Province, 1938-1956. 115

III-H-II Corn: Percent of Total Production by Region and Province, 1938-1956...... 116

III-H-III Corn: Area Planted by Region and Province, 1938-1956 117

III-H-IV Corn: Percent of Total Area Planted by Region and Province, 1938-1956...... 118

III-H-V Corn: Yield Per Hectare by Region and Province, 1938-1956 ...... *...... 119

Section IV

IV-I Estimate of Copra Production by Region and Province, 1955 ...... * * ...... 134

IV-II Origin and Destination of Copra Shipment, 1955 . . . 137

xii TABLE OF CONTENTS (Continued)

Number Page

Section IV (Continued)

IV-III Comparison of Estimates of Total Shipments and Adjusted Total Production for Copra Region III by Province, 1955...... 141

IV-IV Estimated Gross Cane Ground by Province, Crop Year 1954-1955...... 173

IV-V Centrifugal Sugar Allotments, 1954-1955 Crop . . . . . 176

IV-VI Quantity of Centrifugal Sugar Exported to the United States, to World Markets and Allocated to the Domestic Markets, by Region and Province...... 177

IV-VII Distribution of Refined Sugar from Victorias Milling Company, Inc., 1954-1955...... 178

IV-VIII Molasses Production by Province and Central, Crop Year 1954-1955...... 180

IV-IX Exports of Molasses by Port, 1955...... 182

IV-X Fibers: Total Production of Abaca, Ramie, and Maguey by Products, 1955...... 188

IV-XI Fibers: Estimated Total Production of Abaca Fiber by Region and Province...... 192

IV-XII Total Quantity of Abaca Fiber Baled by Region and Province, 1955...... 194

IV-XIII Estimated Quantities of Loose Abaca Fiber Shipped to Domestic Manufacturers by Region and Province, 1955 201

IV-XIV Quantity of Baled Abaca Fiber Exported by Port and Province, 1955...... 202

IV-XV Virginia Leaf Tobacco: Estimate of Area and Produc­ tion by Region and Province, 1955...... 221

xiii TABLE OF CONTENTS (Continued)

Number Page

Section IV (Continued)

IV-XVI Virginia Leaf Tobacco: Estimated Production by Region and Province, January-July, 1956...... 222

IV-XVII Native or Cigar Leaf Tobacco - Estimated Area and Production by Region and Province, 1955...... 224

IV-XVIII Exports of Cigar Leaf and Cigars and Cigarettes. by Port of Export, 1955...... 227

Appendix Tables, Section IV

IV-C-I Area Planted to Abaca, Maguey, and Ramie; by Region and Province, June 30, 1955...... 209

IV-C-II Firms Baling Abaca Fiber, Philippines, 1955...... 211

IV-C-III Exports of Cordage and Hemp Rugs by Port of Export and Province, 1955 ...... 213

IV-D-I Firms Manufacturing Virginia Cigarettes, Philippines . 233

IV-D-II Firms Manufacturing Cigar and Native Cigarettes by Region...... 234

IV-D-III Virginia Tobacco Receipts, 1955 Season ...... 238

Section V

V-I Timber and Lumber Production by Province, Fiscal Year 1954-1955...... 258

V-II Estimates of Total Accessible Forest, Volume by Province, 1952 ...... 260

V-III Lumber and Log Receipts, Manila, 1954-1955 ...... 263

V-IV Selected Timber and Lumber Transport Rates, 1956 . . . 264

xiv TABLE OF CONTENTS (Continued)

Number Page.

Section VI

VI-I Mineral Production Including Cement and Fertilizer, 1955 ...... 285

Section VIII

VIII-I Trade Centers and Tributary Areas, Philippines . .. . 317

List of Figures

III-I Regions of Palay Production, 1955...... 23

111-2 Net Surplus and Deficit Rice Production, 1955. .. . . 50

111-3 Net Surplus and Deficit Corn Production, 1955. . 102

IV-4 Major Coconut Oil Mills, 1956...... 128

IV-5 Desiccated Coconut Factories, 1956...... 129

IV-6 Regions of Copra Production, 1955...... 131

IV-7 Estimated Copra Production, 1955...... 132

IV-8 Origin of Copra Shipped to Cebu...... 140

IV-9 Monthly Shipments of Copra into the Port of Manila 143

IV-10 Monthly Shipments of Copra into the Ports of Tabaco and Legaspi...... 146

IV-11 Monthly Shipments of Copra into the Ports of Zamboanga and Cagayan...... 148

IV-12 Copra Interisland Shipping, Port of Davao...... 150

IV-13 Location of Sugar Centrals, 1955 ...... 171

xv TABLE OF CONTENTS (Continued)

List of Figures (Continued)

Number Page

IV-14 Total Centrifugal Sugar Allotments--Crop Year, 1954-1955...... 175

IV-15 Estimated Total Production of Abaca Fiber by Region, 1955...... 191

IV-16 Abaca (Manila Hemp) Interisland Shipping into the Port of Davao...... 197

IV-17 Monthly Shipments of Abaca Fiber into the Ports of Tabaco and Legaspi...... 198

IV-18 Monthly Shipments of Manila Hemp into the Port of Manila ...... 200

IV-19 Virginia Leaf Tobacco Production by Province, 1955 . . 220

IV-20 Native Cigar-Leaf Tobacco Production by Province, 1955 226

.V-21 Timber and Log Production by Province, 1954-1955 . . . 242

V-22 Lumber Production by Province during the Fiscal Year, 1954-1955...... 244

V-23 Volume Potential Accessible Forest (Excluding Protec­ tion Forest) by Province...... 245

V-24 Lumber and Log Receipts, Manila, 1954-1955 ...... 250

VI-25 Non-Metallic Mineral Production (Including Cement and Fertilizer), 1955...... 272

VI-26 Base Metals Production, 1955...... 276

VI-27 Gold and Silver Mining (Employment),..1955...... 279

VIII-28 Trade Centers and Tributary Areas...... 304

VIII-29 Population Distribution...... 305

IX-30 Traffic Flow Map, Philippines, 1954 ...... 339

xvi Section I

INTRODUCTION

Section I

INTRODUCTION

Commodity and passenger flows create the demand for transport. The assessment of the adequacy of the transport network in relation to re­ quirements for national integration and economic development require an analysis of traffic distribution patterns and potential.

The demand for transport will vary depending upon the volume of the commodity moved and the distance which the commodity is transported by domestic transportation carriers. Thus the major commodities ,erg analyzed to determine (1) the present and potential volume of each major commodity transported from production sites to poinLs of consumption or of shipment to world markets; and (2) the geographical and marketing pattern of distr 4tior.

In addition, the transportation needs and improvements which were indicated by these analyses and field surveys are set forth in this volume in the sections on the individual commodities.

Data on commodities shipped by domestic transport were not avail­ able from transport carriers or government agencies in most cases. Therefore, estimates were derived from.data on production, consumption, exports, imports, and manufactures. Agricultural commodities for export and for the domestic market comprise the initial two groups of com­ modities analyzed. These sections of the study include the two major food crops--palay and corn--and the four principal commercial crops-­ coconut and coconut products; sugar; fibers including abaca, ramie, and maguey; and tobacco and tobacco products. The remaining groups of commodities covered were forest and lumber products; mineral production including cement and fertilizer; and manufactures. In addition, trading centers and tributary area were delimited and mapped in order to deter­ mine the distribution of imports and manufactured consumer products.

Finally, passenger movements were studied and passenger flow pat­ terns were mapped. A more complete discussion of passenger movements specifically related to water, land, and air transportation appears in the following volumes in this study: Volume III, Philippine Domestic Water Transportation and Ports; Volume IV, Land Transportation--Roads and Motor Vehicles; Volume V, Land Transportation--Railroads; Volume VI, Air Transportation.

3 IV1 Section II

SUMMARY AND CONCLUSIONS Section II

SUMMARY AND CONCLUSIONS

The findings on the total quantity of the commodity transported, the geographical and marketing patterns of distribution, and the specific conclusions which have been indicated in relation to transportation needs and improvements of each commodity are summarized in this volume in the ­ section concerned with each commodity. The summary and conclusions which follow immediately here focus on the over-all pattern of dis­ tribution and are discussed under the following categories: export commodities, domestic commodities, imports and consumer manufactures, trading areas and passenger movements.

Export Commodities

Export commodities comprise as much as one-third to one-half of the total tonnage of major commodities (excluding local construction materials and the like) which are shipped within the Philippine archipelago. The total demand creatcd by export commodities for transportation facilities varies significantly depending upon the distance the commodity is moved before reaching an offshore vessel for shipment to world markets.

In 1955, export of logs, lumber, and minerals accounted for about 3.5 million tons, with a definite planned increase to about 6 million. Since production is generally close to the coasts, these heavy bulk movements are generally made by the shortest route to a shipping point. The transport facilities are usually one-purpose and are supplied by private users.

The major agricultural exports reached a total of alinost 2.5 million metric tons in 1955. These agricultural products were moved first from producing areas to primary concentration points--copra bodegas, sugar centrals, or baling locations. From these points, over half of them were subsequently shipped relatively long distances either to ports for export or to domestic processing plants.

A large part of the centrifugal sugar had a transport pattern similar to logs and minerals--short-haul shipments to the nearest central or to a coastal landing by private transport facility.

7 PRElUS PAG 9wNK Most of the sugar cane was moved by private railroads, but the relatively small amounts shipped on the Manila Railroad or the Philippine Railway comprised the largest single commodity movements over each of those lines.

Copra shipped to bodegas and abaca transported to baling centers prior to export create a large demand for roads and trucks.

The further demand for transportation of agricultural export com­ modities from primary concentration points to offshore vessels is generated principally by shipments to major ports for transshipment, and to Manila by truck for coconut-oil mills; abaca in-transit shipments to Manila; and the truck shipments of tobacco to manufacturing plants in Manila. These commodities comprise an important part of the freight transported by carriers in the Philippines.

Transportation needs and improvements indicated by the findings on the study of commodity movements in respect to export commodities are as follows:

1. The major problem of transportation of agricultural export products is in the collection and movement of commodities to primary collection points. Inefficient transport facilities and excessive handling are common. The principal transportation need is for better roads.

2. Most minerals and forest products move only short distances to shipping points, generally provided and maintained by private companies. Consequently, there is little need for government assistance.

3. The extension of transport facilities to new producing areas does not generally constitute a major problem of the export sector of the economy. New export crops such as ramie do not warrant extension of roads until more concrete evidence of production potential is demonstrated.

The Movement of Domestic Commodities

The products produced, consumed, and utilized within the Philippines create more demand for domestic transport than do the traditional export commodities. The bulk of this movement is servicing the domestic economy with foodstuffs and other domestic materials, such as lumber, cement, coal, and fertilizer.

8 The transport of a large part of the total production of agricul­ tural commodities, local construction materials and the like, is comrrised of local, short-distance movement and thus does not contribute significantly to domestic transport demand.

The most important domestic commodities which move between provinces or between rural and urban areas within provinces are the two principal food crops, rice and corn. Rice production exceeds local consumption in several surplus areas: Nueva Ecija in north central Luzon, the Cagayan Valley, parts of Mindanao, and elsewhere. From these points, rice is shipped to the large urban markets, principally Manila, or to deficit areas, in particular to specialized export areas such as Negros. This specialization of export production on the one hand and domestic food crop production on the other, produces a complementarity promoting integration of the country. Over the next decade, these basic commodity flow patterns will persist.

In addition to food products, a variety of other commodities for domestic consumption--notably cement, coal, fertilizer, and lumber--also create demands for transport. While Manila is the largest market Lnd alone receives about half the domestic lumber, for example, anticipated development of processing of these materials will generate more movement in the future. Toledo in Cebu, and Iligan in Mindanao, are likely centers for copper smelting and steel production, respectively, as well as for fertilizer manufacture.

The following transportation needs are indicated in respect to domestic commodity movements.

1. The primary problem is in the collection and movement of com­ modities to primary concentration points. Better roads including barrio roads are needed.

2. The improvement of roads to collection centers is directly related to the successful operation of Farmers Cooperative Marketing Associations. Determination of priorities in the allocations of funds to roads, therefore, should be coordinated with the needs of the Agricultural Credit and Cooperative Financing Administration and the National Rice and Corn Corporation.

9 3. Access roads to new producing areas will be required over the next decade, particularly in surplus producing areas. These roads should be constructed, however, only after careful land surveys and the formulation of developmental plans by specific government agencies, such as the Departments of Agriculture and Natural Resources, the Department of Commerce and Industry, the Agricultural Credit and Cooperative Financing Administration, and the Office of Economic Coordination.

4. More economical methods of shipping minerals and lumber by domestic water transport are required, including specialized carriers, bulk handling techniques, and more dependable service.

The Movement of Imports and Manufactures for Domestic Consumption

The movement of imports and manufactured goods to final consumers is significant, although with the exception of petroleum this movement is not as heavy as the flow of primary commodities, foodstuffs, or domestic materials such as cement, coal, and fertilizer.

Manila is the principal port for imports and the center of consumer product manufacture as well. Therefore, the demand for domestic trans­ port of imported commodities and consumer manufactures stems primarily from the distribution of these commodities from Manila to outlying markets and is not as great as would be the case if manufactures had to be distributed to Manila from outlying production centers.

Imported commodities and manufactured consumer goods not only have less bulk and weight than primary commodities or domestic materials but generally move in the opposite direction from foodstuffs and raw mater­ ials. The seasonality of foodstuff production, moreover, contributes to high load factors for parts of the year on many routes. The results of this unbalanced traffic, which is characteristic of many economies, are not as pronounced in the Philippines as elsewhere because many of the heavy primary commodities--minerals, timber, a large proportion of the sugar--are exported directly abroad. In some instances the domestic movement of consumer manufactured products and general imports into an area may actually be heavier than the domestic movement of raw materials out. Some routes are unbalanced in one direction; others, in a reverse direction; and still others are relatively balanced.

10 The most important transport requirement in relation to the dis­ tribution of imported commodities and manufactured consumer products is not the balance of traffic, however, but rather the improvement of the facilities of the port and industrial area at Manila, especially since manufacturing activity is increasing rapidly in keeping with national development plans for serving the domestic market. The concentration at Manila is likely to continue since the domestic market of which Manila is the center is large enough to support only limited development. Industrial land in Manila is not only expensive and scattered but remote from the port through which many of the domestic and imported raw materials must move before reaching processing and manufacturing plants. Development of an industrial port area should receive careful considera­ tion in view of the need to reduce not only manufacturing costs but also the traffic problem of Manila.

Petroleum is the largest single import, amounting to approximately two million tons per year. Since petroleum is a bulk commodity, it is an exception to most other imports or manufactured goods. Domestic tankers, barges, and tank trucks are used to redistribute it from a few main centers of import or refining (Manila, Cebu, Batangas, San Fernando, Davao, and Iloilo). A significant proportion of the petroleum volume moves in containers; distributors often take advantage of cheap back-haul rates, and thus this traffic is a part of the general move­ ment of imports and manufactures unlike the bulk petroleum movements by private tankers through private facilities.

Traffic Areas

In addition to the analyses that were made of the volume and pattern of commodity flows, trade centers were determined, and trade areas were delimited and mapped. These trade centers, which are the foci of passenger movements and the generators of other traffic on the islands, are the distribution centers for imports and manufactured products.

Sixty-six major and secondary centers serving as regional or district economic and social centers have been defined. Many of these centers are also political capitals. Half of the total number of centers are defined as major centers with rather well defined trade areas; half as secondary centers, similar to the major centers, but, in most cases, with less well defined trade areas. In addition, some 126 or more minor centers have been recognized, with only local or poorly defined trade areas. Below this level are thousands of smaller poblacions and barrios.

11 Manila is the national center controlling the production of a wide local area as well as specialized services for all the islands. The cities of Cebu, Iloilo, Davao, and to a lesser extent, Zamboanga are regional centers with Cebu City the moit important.

In some less developed areas, no completely organized framework of trade exists. Often the only means of surface access is by boat at isolated coastal landings--notably along the northeast coast of Luzon, the east coast of Mindanao, and the Zamboanga peninsula of Mindanao. Moreover, in some places direct distribution from the interregional centers is more important than local distribution from smaller regional centers. This is particularly true near Manila and in areas with poor land transport but with water connections to a major regional center.

The growth of regional centers--desirable for the more complete political, professional, social, and economic services which are es­ sential for economic and social development--would be encouraged by that improvement of transportation facilities necessary to secure lower-cost local commodity movements.

Passenger Movements

Domestic passenger movements are heavy and generate more demand for domestic transport facilities than freight. As a part of the general political, social, and economic servicing of the economy, pas­ senger movements contribute to and reflect the integration of the Philippines. Although seasonality strongly affects volume of traffic and creates loading problems, especially on some longer routes, direction of movement is generally balanced.

12 Section I II

AGRICULTURAL COMMODITIES--FOOD CROPS Section III

AGRICULTURAL COMMODITIES--FOOD CROPS

The Movement of Food Crops

Food crops produced in the Philippines are consumed almost entirely within the archipelago. The movement of the two basic cereal crops, rice and corn, from surplus producing areas to deficit areas and within provinces constitutes the great bulk of the demand for transportation facilities stemming from the production and consumption of food crops. Shipments are also made of bananas, root crops--principally camote and cassava--and other fruits and nuts. Although the supplying of these secondary food crops to Manila and other urban centers results in some interprovincial shipments, most shipments of these products are made within the producing province. Small quantities of other domestic food crops which are produced require only limited transportation. Likewise there is only minor export of food crops and the movement to ports of export for shipment of food crops to world markets comprises a small demand for transportation facilities.

The shipment of food crops from producing to consuming areas within the Philippines generates demands for transportation varying in magni­ tude depending on the distance and the amount of the crops shipped: (1) between regions or provinces, (2) within the province between rural and urban areas, and (3) to a local market near the producer. In addition, the amount shipped will depend upon the proportion of the crops consumed directly by the producer.

Interregional and interprovincial movement of food crops consti­ tutes the largest per unit-ton kilometer demand for transportation and probably the greatest percentage of total demand for transportation as well. The total tonnage shipped within provinces between rural and urban areas is sizeable in the aggregate. But it is estimated that food crops moving from farms to towns generate less demand for trans­ portation than interprovincial movements. The shipment of food crops to local markets close to farms are usually small-unit loads commonly hauled, often by individual sack, by cart, or carabaos, or taken on a bus, and comprising a demand for relatively minor transport facilities. These local movements of food crops are one of the factors accounting for the volume of passenger traffic within provinces.

15 PREnOUS P7-B rL PALAY AND RICE

PREVIOUS PAGE BLANK Palay and Rice

During the crop year 1954-1955, the area planted to palay (rough rice) was approximately 2.7 million hectares or about 45 percent of the total area planted to all crops..1/ Total production was 72.8 million cavans which constituted about 3.2 million metric tons.

It has been estimated that 56 percent or 1,800,000 metric tons of the total production of palay harvested throughout the Philippines was held by palay farme- and hired laborers for their own consumption or was marketed locally by the farmers or through small dealers. This large tonnage of palay, therefore, generated only a relatively small demand for transportation.

About 1 4 million metric tons of palay, or 44 percent of the total production, however, generated a significant demand for transportation facilities. This quantity moved to conos (large rice mills) and was sold through palay and rice dealers in markets outside of the producing province or in provincial markets within the producing province.

An estimated total of between 525,000 to 550,500 metric tons of palay and rice combined were shipped between provinces and regions during 1955.

Methods of Marketing Palay and Rice

Palay (rough unhusked rice) is grown on small farms which average two or three heccares. 2 / Harvesting and threshing of palay is done mainly by hand and with the use of animals by the individual farmer and his family, most often in cooperation with neighboring farmers. In some areas, harvesting and threshing is done with the aid of migratory farm laborers who receive payment in kind. Threshing machines are also used to some extent, particularly in Central Luzon, the owner of the machine also receiving payment in kind.

1/ Department of Agricultural and Natural Resources, Division of Agricultural Economics, Selected Statistics on Rice and Weather Conditions. Manila, 1955. Mimeographed. Tables 13 and 13a. 2/ DANR, Division of Agricultural Economics, Philippine Agricultural Statistics, Vol. II, 1956, Table 26, p. 69.

19 PREitUS AE' The disposition of palay from the point of threshing and placing into sacks may be divided into two stages:

(1) The quantity of palay directly consumed and marketed by farmers or the hired laborers

(2) The quantity of palay distributed through palay merchants

Disposition of Palay by Farmers and Hired Laborers

The quantity of palay which is held by the palay farmer for his own consumption, for seed and for animal feeds is stored on the farm in sacks or in bulk in large basket-like containers. This quantity of palay is either milled by the farmer by hand-pounding or is trans­ ported by him to a local kiskisan (small rice mill). The sacks of palay are transported to the mill in carabao cart, bus, or banca. Part of the palay is paid to mill owner in milling fees and the remainder is brought back to farm for consumption. This movement is comprised of small unit, short-haul loads.

The quantity of palay which is marketed directly by the farmer in the local market is also transported by him to the kiskisan for milling, before it is sold in the local market for local consumption.

The quantity of palay paid to hired laborers for services ren­ dered in harvesting and threshing must also be transported to the area in which the laborers live, often a considerable distance from the locale of harvesting. Trucks and water transport are used by the harvesters to ship palay to their home province. When the palay reaches the home province, a proportion is consumed and marketed directly in the same mainer as by the palay farmer; the remainder is marketed through palay dealers.

From this analysis of the marketing of palay by both the palay farmers and the hired laborers, it may be concluded that the quantity of palay that is milled at local kiskisans is principally that amount of palay which is consumed directly by farmers or harvesters or sold on the local market. Kiskisans are used only to a small extent by palay dealers due to the difference in milling results. The quantity of palay distributed through palay merchants, on the other hand, is milled in conos.

Disposition of Palay and Rice Through Dealers

The movement of palay from the farmer to the final consumer of rice through commercial marketing channels involves numerous .dealers. 20 The quantity of palay which enters into commercial marketing channels, through palay and rice dealers includes the quantities of palay used in the payment of debts incurred by the farmer in the pro­ duction of rice; for rent of the land; and to creditors. In addition, the farmer sells palay to palay dealers for cash not only for payment of debts but also to meet his needs and desires for cash for general consumption. The net result is in many areas that the farmer sells or disposes of a large proportion of the rice requirements for his own family's consumption. Thus, the palay farmer is required to buy rice on the local market to meet the consumption needs of his family.

The primary concentration point in the disposition of palay through commercial channels is Lhe cono or large rice mill. According to an unpublished study conducted by personnel of the Agriculture Credit and Cooperative Financing Administration, the four requirements for the successful operation of a cono are: (1) Trucks to collect and deliver palay and rice to the mill and to markets, (2) storage space for palay, (3) a mill of sufficient size to realize economies of milling and to allow for the processing of an adequate volume of palay, and (4) capi­ tal to speculate on the changing price of palay and rice.

The cono operator is not only a miller of palay, i.e., profits are not made solely on the basis of milling palay. Milling is one integral part of the function of the cono operator as a dealer of palay. The mill is one of the elements which allows him to take advantage of many facets of the marketing process of palay.

The movement of palay to the cono is usually by trucks owned by the operators of the cono. Palay is collected from numerous agents and collection points throughout producing areas which may cover a broad geographical region. For example, the cono operator in Bulacan may find it profitable to send his trucks to Cagayan Valley for the collec­ tion of palay.

There are, of course, palay dealers between the cono operator and the palay farmer. But a dealer who does not own a cono is, in effect, an agent of the cono operator. Those intermediate dealers who also own trucks may move palay to the cono. In addition a small percentage of palay will be transported to the cono by the palay farmer by carabao cart, banca, and bus, or in the case of a large landowner by truck. However, most of the palay deliveries to conos are made by trucks of cono operators.

When the palay is received at the cono it is stored. Most of the palay will be milled at the cono at which it is initially received.

21 This applies to the amount of rice needed to meet local and provincial demands and to meet most of the demand from markets outside of the province of origin. As a palay dealer first, and a palay miller second, the cono operator will sell palay to other regions when the transaction is more profitable. Thus for example, a cono in Santiago, Isabela, may sell palay to a cono in Central Luzon or in Bulacan.

From the cono at which the palay is milled, the rice moves to provincial markets and markets outside of the province. The distribu­ tion of rice to dealers in towns within the province is made by the trucks of the cono operator. This movement is supplemented by the quan­ tities of rice transported by dealers who are not owners of a cono but who also own trucks. In some provinces where roads are not available the rice -.s delivered to provincial markets by water transportation.

The movement of rice to markets outside the province is by truck, rail and interisland vessels. This rice is sold to rice dealers who in turn sell the rice to the final consumer.

Origin and Destination of Palay and Rice, 1955

Figure III-1 shows the geographical boundaries of nine palay regions. The geographical boundaries of these regions are those set forth by the Division of Agricultural Economics. From the analysis of the movement of palay and rice it is concluded that changes in the boundaries of these regions are not warranted.

In 1955, Palay was produced in every province of the Philippines. Table III-I sets forth the percent distribution of rice production by province. The major producing areas were central Luzon, southern Tagalog, western Visayas, Cagayan Valley, and Cotabato.

The demand for transportation generated by the palay produced in these provinces will vary depending upon the amount which is consumed and marketed directly by palay farmers and hired laborers; the quan­ tities milled by conos and sold in provincial markets; and the quan­ tities of palay and rice which are sold in markets outside the original province of production.

Palay and Rice Held and Marketed Locally by Farmers and Hired Laborers

A survey of the disposition of palay by palay farmers has been completed by .the Division of Agricultural Economics. The results and

22 -Legend- I ILOCOS II CAGAYAN VALLEY III CENTRAL LUZON IV SOUTHERN TAGALOG V BICOL VI EASTERN VISAYAS VII WESTERN VISAYAS VIII NORTHERN AND EASTERN MINDANAO IX SOUTHERN AND WESTERN MINDANAO

IVI

IfI %%V % V

%%

I 1

I~ ' #

REGION R/ i A 10

'.4 VIIEInicTIN DVSSO

7- '1/ -AN L Table III-I

PAIAY: PERCENT OF TOTAL PRODUCTION Y REGION AND PROVINCE 1955

Region and Province Region and Province

Philippines 100.00% ' Bicol 7.5%

Ilocos 3.5 Albay 1.3 Camarines Norte .0.3 Abra 0.8E Camarines Sur 4.0 Batanes * Catanduanes 0.2 Ilocos Norte 0.9 Masbate 0.5 Ilocos Sur 1.0 Sorsogon 1.2 La Union 0.9 Eastern Visayas 9.4 Cagayan Valley 9.7 Bohol 2.4 Cagayan 2.5 Cebu 0.3 Isabela 3.4 Leyte 3.9 Mountain Province 2.1 Samar 2.8 Nueva Vizcaya 1.6 Western Visayas 14.8 Central Luzon 26.9 Antique 1.3 Bataan 0.4 Capiz 3.1 Bulacan 3.4 Negros Occidental 3.3 Nueva Ecija 8.2 Negros Oriental 0.3 Pampanga 3.3 Romblon 0.5 Pangasinan 8.2 Iloilo 6.2 Tarlac 2.8 Zambales 0.6 Northern and Eastern Mindanao 7.2

Southern Tagalog 11.4 Agusan 0.7 Bukidnon 1.3 Batangas 2.4 Lanao 2.3 Cavite 1.9 Misamis Occidental 0.6 Laguna 1.3 Misamis Oriental 0.3 Marinduque 0.2 Surigao 1.9 Mindoro Occidental 0.3 Mindoro Oriental 1.2 Southern and Western Mindanao 9.6 Palawan 0.4 Quezon 1.8 Cotabato 5.3 Rizal 1.9 Davao 1.5 Sulu 0.6 Zamboanga del Norte 0.8 Zamboanga del Sur 1.4 * Indicates less than one-half of one percent. Detail may not add to totals due to rounding. 24 explanation of the estimates derived from this survey are set forth in Appendix III-A and Table III-A-I.1/ It has been estimated that 56 per­ cent of the palay grown during the crop year 1954-1955 was held and marketed locally by farmers or other users../ Therefore, of the total production of 3,200,000 metric tons of palay during 1954-1955, approxi­ mately 1,800,000 metric tons generated only a minor demand for trans­ portation facilities. The proportion of this tonnage which was transported moved only short distances and in small unit lots by carabao cart, banca, or bus.

An analysis of the regional pattern indicates some significant differences among the nine regions shown in Figure III-1. The quantity of total production consumed by families of palay farmers ranges from a low of 21.6 percent of total production in central Luzon to a high of 58.3 percent in the Ilocos region../ While an explanation of these variations would require a special study, some hypotheses may be suggested. The low proportion of total consumption in the central Luzon area may be due to the more intensified palay agriculture, high tenancy rate, small size of farm, and long standing customs. It would be of particular interest in the study of transportation problems to determine to what extent the lack or accessibility of transportation facilities determine the share of the crop held by the farmer. An initial indica­ tion from this study is that the more accessible the transport facilities, the greater the tendency for the farmer to sell palay which could be used for his family's consumption. This points to the fact that the impact of improved transportation on the welfare of the palay farmer may be offset by other elements in the economy such as the marketing organiza­ tion or land tenure.

Intraprovincial Movement of Palay and Rice through Palay Dealers

The remaining 44 percent of total palay produced during 1954-1955 constituted 1,400,000 metric tons. This tonnage constitutes the esti­ mated quantity which was collected and distributed through cono

1/ Appendixes III-A through III-E and appendix tables relating to palay and rice will be found in Section III immediately following the discussion of those commodities. 2/ From this estimate the quantity of palay milled in kiskisans may also be estimated. See Appendix III- and Table III-B-I. 3/ See Appendix III-A, Table III-A-I

25

CENTRAL EMV LIBRARY USAID/MANILA operators.j/ Most of this quantity was collected by trucks owned and operated by the rice mills and moved initially into the warehouse of a cono operator. Therefore, a significant demand for transportation facilities was generated by this tonnage of palay moving to large rice mills.

From the primary concentration point at the cono the palay was sold to other markets outside the province; milled and then sold as rice to markets outside the province; or milled and sold in markets within the province.

About 21 percent of total palay produced in 1955 or 670,000 metric tons of palay milled at conos within the province of production were distributed to provincial markets. These provincial markets were com­ prised of urban centers, small towns and to some extent local markets. The intraprovincial distribution of rice constituted an impor­ tant demand for transportation facilities, since it is estimated that practically all of this rice movement was done by trucks.

The reasons for intraprovincial movement stem primarily from demand of the urban areas within the province of production. However, an addi­ tional reason is the marketing organization centered in the cono opera­ tor. As explained in the discussion of marketing methods of palay, the cono operator is most importantly a palay dealer. The palay dealer buys palay from the farmer when prices are low and then sells rice later in the year when prices are higher. The palay does not usually leave the province when it is destined ultimately for markets within the province. The cono operator stores the palay and mills it when he considers the most advantageous price is obtainable. This marketing pattern explains, in large part, the movement of palay to conos and the return movement of rice to local markets. From the survey of palay and rice movements it was learned that the movement of palay to mills and then back to markets is sometimes mistakenly identified as cross-hauling.

Interprovincial and Interregional Movements of Palay and Rice through Palay Dealers

The analysis of the interprovincial and interregional movement of palay and rice was based on the following data:

1. Estimates of surplus and deficit production by province by the Division of Agricultural Economics.

1/ According to these estimates a minimum of 1,400,000 metric tons of palay were milled at conos during the crop year 1954-1955.

26 2. Estimates of receipts and shipments of palay and rice at the port of Manila compiled by the National Rice and Corn Corporation from manifests of interisland vessels.

3. Receipts of palay and rice at the port of Cebu compiled by special study conducted for Stanford Research Institute from a count of sacks of palay and rice received at Cebu.

4. Estimates of receipts of palay and rice at eight major ports compiled by Dr. Frederick Wernstedt from a three month sample of mani­ fests from October 1953 to May-June 1954.

The major conclusions from this study are as follows: 1/

1. The great bulk of palay and rice movements between provinces was from surplus to deficit producing provinces.

2. Although accurate seasonal data were not available, the total tonnage shipped because of difference in harvesting and planting seasons was small relative to the total interprovincial movement of palay and rice of the Philippines.

3. From the study of shipments made by interisland vessels very little cross-hauling was discovered. In the numerous interviews and the surveys conducted in respect to palay and rice movements, many persons expressed the opinion that large quantities of palay and rice move out of a given province during one period of a year and equally large tonnages are shipped back to the same province at a later period. There was very little evidence found to support such a conclusion. Cross-hauling is not a major aspect of the movement of palay and rice in the Philippines.

4. The total tonnage of rice and palay combined, which was shipped between provinces, totalled between 525,000 metric tons and 550,000 metric tons.

5. The largest tonnage movement of palay and rice between provinces was the north-south movement on the Island of Luzon. Ship­ ments from the surplus producing provinces of the central plain of Luzon supplemented by sizeable shipments from Cagayan Valley met, in

1/ For detailed analysis see Appendix III-C including Figure 111-2 and Tables III-C-I through III-C-IV which will be found at the end of the discussion on palay and rice.

27 large part, the deficits of Manila, the Ilocos region, Zambales, Bataan, the southern Tagalog provinces and the Bicol region. Camarines Sur was the surplus producing province of the Bicol region, but did not fully meet the deficit of that area.

6. These movements on the Island of Luzon comprised about two­ thirds of all interprovincial shipments of palay and rice.

7. The Visayas were a net deficit area. Iloilo, Capiz, and Bohol were surplus producers and supplied about one-half of the palay and rice requirements of the Visayas.

8. The remaining 50 percent of the deficit of the Visayas was met by surplus production of palay from Mindanao.

9. Cotabato was the largest surplus producing province of Mindanao and accounted for the highest proportion of palay and rice shipped to the Visayas. In addition, Cotabato supplied Zamboanga City, Sulu, Davao and made shipments to Manila.

10. Bukidnon is the second largest surplus producer and supplied most of the deficit of Misamis Oriental.

11. A large portion of the shipments of palay and rice in the Visayan-Mindanao area involved shipments from surplus areas within a province which in many cases was a net deficit producing province.. For example, shipments from northern Zamboanga del Norte were made to numerous markets while Zamboanga City and the province of Zamboanga del Norte were classified as deficit areas; the area around Pagadian, Zamboanga del Sur shipped palay and rice to Misamis Occidental, a net deficit province, which in turn shipped to Cebu; Surigao and Agusan shipped to Leyte, a net deficit province, which also shipped to Cebu. Most of these movements averaged between 3,000 and 5,000 metric tons.

12. The movements of rice and palay within the Visayas and between Mindanao and the Visayas comprised about one-third of all interprovincial shipments.

13. The shipments of palay and rice from Manila were principally to deficit areas while a majority of the shipments to Manila were from surplus producing areas. Although the total tonnage shipped to and from Manila was relatively small in comparison to total interprovincial movements, Manila is a distributing center to some extent for rice for provinces as far distant as Cotabato.

28 Future Developments in Palay and Rice 1957-1966

The potential demand for transportation stemming from future developments in the production and consumption of palay and rice will depend upon the anticipated increase (or decrease) in total production and probable changes in the regional patterns of production and con­ sumption. Variations in regional pattern include possible changes in the production of each region and province relative to total production of the Philippines and the change in net surplus and deficit of rice by region and province.

Anticipated Changes in Total Production of Palay and Rice Pro­ duction 1956-1966

As shown in Table III-II total production of rice for 1961 and 1966 has been projected on the basis of per capita requirements for the years 1955 and 1986. Total production for 1961 has been estimated at 2,400,000 metric tons of rice and for 1966 at 2,635,000 metric tons of rice.

Total requirements represent the quantity of rice necessary to meet human consumption needs plus allowances for seed, animal feeds, and industrial and other uses. Total requirements for the years 1940-1956 were derived by adding annual total production of rice and net imports of rice. Carry-over of rice stocks from year to year were considered negligible. A per capita requirement of 98 kilograms was projected to 1961 and 1966. Utilizing the population estimate of the Bureau of Census and Statistics,!/ the total production estimate was calculated by multiplying total population as of July 1 by the per capita requirement of 98 kilograms.2 / The figures were then rounded to the nearest thousand metric tons.

1/ The Technical Working Committee on Demography recommended the use of Bureau of Census and Statistics population estimates over alter­ native methods for the present time. See National Economic Council, Office of Statistical Coordination and Standards, Report of the Technical Working Committee on Demography, Manila, 1956. Mimeographed. 2/ Ninety-eight kilograms or 1.75 sacks of 56 kilos of rice was the figure stipulated in the Report of the Committee on Rice Production and Consumption for the Crop Year 1956. April 3, 1956.

29 Table III-II

DOMESTIC RICE REQUIREMENTS, PHILIPPINES, 1940-1966

Total Net Total Total Rice Impo rts Domestic Per Capita Production (met ric Requirements Requirement Year Population (metric tons) ton s) (metric tons) (kilograms)

1940 16,459,900 1,535,787 38, 157 1,573,944 95.62

1948 19,143,800 1,456,555 96, 676 1,553,231 81.13

1951 20,259,500 1,698,954 129, 849 1,828,803 90.27

1952 20,645,600 1,838,146 61, 795 1,899,941 92.03

1953 21,039,200 2,041,659 - 2,041,659 97.04

1954 21,440,200 2,066,514 - 42, 339 2,109,153 98.37

1955 21,848,800 2,078,977 67, 800 2,146,777 98.26

1956 22,265,300 2,097,990 80,0 00-1/ 2,177,990 97.82

1961 24,469,700 2,398,031 - 2,398,031 98.00

1966 26,892,300 2,635,445 -- 2,635,445 98.00

1/ Amount authorized for importation, 1956.

Sources: Bureau of Census and Statistics. DANR, Division of Agricultural Economics, Philippine Agricul­ tural Statistics, 1954, Vol. I, p. 29. National Economic Council, Office of Statistical Coordination and Standards, Report of the Committee on Rice Production and Consumption for Crop Year 1956, April 3, 1956 (mimeographed). Stanford Research Institute.

30 These projections of total productionl/ for the years 1961 and 1966 involve three assumptions in addition to the basic assumption that national income will increase over the next decade: (1) per capita rice requirements will remain stable over the decade 1957-1966; (2) domestic production of rice will increase sufficiently to supply total requirements, i.e. there will be no net imports of rice on the average 1957-1966; (3) domestic production will not exceed total domestic requirements, i.e. there will be no net export of rice on the average 1957-1966.

The discussion of these assumptions is given in Appendix III-D at the end of this section.

Anticipated Changes in Regional Patterns of Palay Production 1957-1966

Tables III-E-I through III-E-V in Appendix E summarize the changes in the nine palay regions, (shown earlier on Figure 1) between 1939 and 1956. Total production of palay, percent of total production of the Philippines, area planted, percent of area planted and yield per hectare are set forth by region and province for selected years. Although detailed analyses of each province are required to fully assess future trends, some of the basic trends in regional production can be derived from these tables.

In respect to the movement of palay and rice over the next decade the most important changes would be those which would alter the pattern of surplus and deficit production. The primary reasonsfor interprovin­ cial shipments of palay and rice stem from surplus and deficit production.

Anticipated Changes in Surplus and Deficit Producing Provinces in Luzon and Adjacent Islands

Manila was the largest deficit area during 1955. With the anti­ cipated changes in total production of palay in the Philippines and the basic assumption that national income will increase, Manila will remain as the largest consuming center of rice in the Philippines. Applying the same percentage of total production which was moved to Manila for consumption during 1955, a total tonnage of approximately 137,000 metric tons will be consumed in 1961 and 150,600 metric tons in 1966.

1/ See Appendix III-D, Table III-D-I.

31 During 1955 the central Luzon provinces of Pangasinan, Nueva Ecija, Tarlac, Pampanga, and Bulacan comprised the largest producing region in the Philippines. Production of the region has increased only 3 percent while the total production of the Philippines increased 41 percent between 1938-1942 and 1953-1956. Thus the percent of total production dropped from 38 percent to 27.8 percent. The slow increase in pro­ duction was due to an absolute decrease in area planted, while yield per hectare increased. Nueva Ecija was the principal province which declined in production as a result of decreased hectarage. Yield remained at the same level. The basic reasons for this decline would require a special study, however, the dislocation of war and unrest in the postwar period undoubtedly account for some of the decline.

Over the next decade, it is probable that production of this region will increase at a slower rate than the total production of the Philippines. It is estimated that this area will produce about 25 per­ cent of total production by 1966. If productivity increases occur the trends of the past 15 years could be changed and greater production will be realized. However, as of 1955, the area was well above the yield per hectare of the Philippines as a whole.

Cagayan Valley the second most important producing area of Luzon, experienced a more rapid rate of increase than the total Philippines. Production increased 71.4 percent. Percent of total production in­ creased from 8 percent to 9.7 percent. This increase was due to both increased yield and hectarage planted to palay. The greatest changes occurred in the province of Isabela where production jumped by 100.7 percent.

Over the next decade some increase in productivity will undoubt­ edly occur and there is ample land available for new production. Therefore, it is anticipated that Cagayan Valley will increase produc­ tion to about 10 percent in 1961 and 10.5 percent of total production of the Philippines by 1966.

This increase in Cagayan Valley production will .offset to a considerable extent the anticipated slower rate of increase of central Luzon area. Therefore, about the same north-south movement of palay and rice should be expected over the period 1957-1966.

The deficit areas of northern Luzon will continue to require rice to meet consumption requirements over the next decade. The production of Ilocos region, with the exception of Abra and Batanes provinces, declined absolutely between 1938-1942 and 1953-1956, declining in rela­ tive importance from 5.9 to 3.7 percent of total production. This was

32 due to a decline in hectarage particularly after 1954, which is related to the initiation of Virginia leaf tobacco production. Yield per hectare was low reflecting the problem of the high man-land ratio of this region. The specific problems of increasing yield in the Ilocos are a subject for a detailed analysis. However, with the anticipated increase in Virginia leaf tobacco, it is estimated that the Ilocos area will remain as a deficit area and requirements for palay and rice will increase.

Zambales and Bataan have experienced significant increases in yield per hectare, while hectarage has declined. Total production increased 6 percent in Zambales and decreased by 13.4 percent in Bataan. On the basis of these trends it is estimated that these provinces will remain as deficit areas over the next decade.

Therefore, the same basic pattern of interprovincial shipments between the provinces north of Manila should remain.

The southern Tagalog region increased production of palay more rapidly than the total Philippines over the past 15 years. Percent of total production rose from 10.2 to 11.5 percent. This was a result of both greater hectarage as well as an increase in yield per hectare. from 18.4 to 25.6. There were differences among the provinces of this region. Batangas, Cavite, Mindoro, Quezon, Palawan, and Rizal accounted for the absolute increase while Laguna and Marinduque declined. The increased production in Batangas and Cavite was due to sharp in­ creases in yield per hectare. In Palawan, Mindoro, and Quezon increases were a result of a greater hectarage, although some increases in yield per hectare were experienced. Laguna dropped in yield as well as hectarage, while hectarage declined slightly in Marinduque. Rizal increased both yield and hectarage.

The trends in this region are difficult to project; however, it appears that production waill increase both absolutely and relatively to the total production of the Philippines over the next decade. Thus, some decline in the deficit requirements of this region will probably occur. If more diversified agriculture is initiated, because this region is adjacent to the Manila market, substitution for palay pro­ duction may occur and change the trend indicated over the past 15 years. Virginia leaf tobacco production in Mindoro will probably not decrease palay production, because of the availability of land and the special­ ized nature of the tobacco project on that island.

The Bicol region as a whole increased production by Q6 percent, as a result of increased hectarage. Yield per hectare declined slightly

33 and was below the average for the Philippines. Camarines Sur accounted for the great bulk of the increase, while the other provinces of the region dropped relatively to the total Philippines.

With the stabilization of the abaca industry, and the problem of Kadang-Kadang disease in the coconut industry, palay production should increase at a more rapid rate over the next decade. Moreover, the low yields per hectare indicate that increases are possible, although no final conclusion can be derived without a detailed analysis. In any case the region will not become a surplus producing area and will still require some shipments of palay and rice to meet deficit requirements.

Anticipated Changes in Surplus and Deficit Producing Provinces in the Visayas and Mindanao

In the eastern Visayas, production of all provinces increased more rapidly than total production for the Philippines. Percent of total production for this region rose from 7.1 to 8.9 percent. The increased production was due primarily to increased hectarage, with only small increases in yield per hectare being registered in most provinces of the region..

Bohol was the only surplus producing area; Leyte, Cebu, and Samar were deficit areas. From the survey conducted in these provinces availability of land was indicated. However, a significant increase in productivity is required if the deficit is to be overcome.

In the western Visayas total production of the region increased at slightly higher rate than the total production of the Philippines. This increased production was a result principally of greater hectarage, and some increases in yield per hectare. Romblon, Negros Oriental, and Antique provinces experienced the greatest percentage increase while Iloilo accounted for the largest absolute increase.

With the stabilization of sugar production and probable decreases in hectarage, increased palay production in Negros Occidental should be expected with a concomitan. decline in the quantities of palay necessary to meet deficit requirements. If the rate of increase in Romblon and Negros Oriental is maintained the deficit requirements of these provinces should decline also over the next decade. These trends indicate that Iloilo and Capiz should fill a greater proportion of the deficit of the western Visayas. It is possible that as a region the western Visayas may become self-sufficient within the next decade. In the northern and eastern Mindanao area, Bukidnon experienced the most significant increase in production. This increase was a result of sharp increases in both hectarage devoted to palay and yield per hectare. In addition Surigao and Agusan registered important gains, as a result of increase in hectarage and yield per hectare. Lanao increased less rapidly, although a significant jump in yield per hectare was experienced. All of these provinces were surplus producers during 1955. If the trend indicated over the past 15 years continues the deficit of the Misamis provinces should be met and a larger portion-of the deficit of the eastern Visayas received from northern and eastern Mindanao provinces. Although Misamis Oriental and Misamis Occidental provinces increased production they will probably remain as deficit areas. Therefore, no sharp departure from present distribution pattern is indicated, although a greater surplus may be shipped to the eastern Visayas.

In the southern and western Mindanao region the largest regional percentage increase in production was experienced of all the 9 palay regions. The percent of total production rose from 5.4 to 9.1 percent. The surplus producing province of Cotabato accounted for most of the gains in absolute production while Davao and Zamboanga del Sur and Zamboanga del Norte combined registered the largest percentage increases between 1938-1942 ard 1953-1956. The growth in production was due to both greater hectarage and increased yield per hectare.

On the basis of these trends, Cotabato will remain as the surplus­ producing province while Davao and the Zamboanga should decrease to some extent as deficit areas. As indicated in the discussion of palay and rice movements during 1955, Zamboanga del Sur and Zamboanga del Norte have surplus producing areas within the provinces, although the provinces as a whole are estimated to be deficit areas. No changes in this pattern are anticipated over the next decade.

Transportation Needs and Improvements in the Movement of Palay and Rice

The movement of palay and rice has been divided into three cate­ gories: the movement of palay to kiskisans and local markets by farmers and hired laborers; the collection and movement of palay to conos for milling; and the distribution of rice from conos to rice dealers for final distribution to consumers.

The primary problem of transportation in the movement of palay and rice is in the collection and movement of palay to the cono. This is

35 particularly important in respect to the program of the Agricultural Credit and Cooperative Financing Administration and the related Farmers' Cooperative Marketing Associations. Better roads are required to facilitate the concentration of palay at the conos of these government agencies.

A secondary problem is the movement from the conos to the rice dealers. In the Visayan area, in particular, the improvement of roads would allow for greater concentration and thus allow for more economi­ cal means of water transport.

Finally, over the next decade, there will be a need for access roads to new producing areas. However, these roads should be con­ structed only after careful developmental plans are completed in coor­ dination with governmental agencies such as the Department of Agriculture, and Agricultural Credit and Cooperative Financing Administration; Depart­ ment of Commerce and Industry, and Office of Economic Coordination. Appendix III-A Appendix III-A

Explanation of the Estimate of Palay Held or Marketed Locally by Farmers and Hired Laborers

The estimate of 56 percent of the palay held or marketed locally by farmers was derived as follows:

a. In Table III-A-I, the quantity consumed by family (Column 10) is shown as 36.80 percent. According to Mr. Castillo c^ the Division of Agricultural Economics, if the survey is reliable no portion of this amount was sold.

b. The residual is the amount of palay left over after subtracting Columns 1-10 from Total Production. It has beeni estimated that 50 per­ cent was sold to palay dealers. Therefore, 45.26 percent of the total production was held by the farmer for consumption and marketed locally by the farmer (Column 12).

c. Part of disposition of palay for the uses and the payments indicated in Columns 1-9 was also held by the farmer, and consumed or marketed locally by the persons receiving the palay in payment from the farmer.

d. It was estimated that 50 percent of the quantities for seed and animal feed was held by palay farmers. The remaining 50 percent was purchased through dealers.

e. Fifty percent of the payments for harvesting, threshing and hauling was consumed or marketed directly by the persons who rendered these services. The remaining 50 percent was sold through palay dealers.

f. In addition to the above total, a small amount was consumed and marketed locally by landlords and creditors. This amount was estimated to be 1.85 percent of total production.

PREVIOU PAGE BLANK Table III-A-I

PALAY: PERCENT DISPOSITION BY REGION, 1955

(1) (2.() ) () Repayment of Repayment of Loans & In- Loans & In- Conamed Total Rent To terest to Land- terest to Sold To By Col.10 + Production Seaed Aniail Food *rresti. Threshinr Haulinr Landlord lord Other Creditors Creditors Family Residual 4 Col.11

PHILIPPINES 100.00 4.04 1.46 7.62 Z."2 C.8l 1.10 2.33 3.87 8.30 36.80 16.92 45.28

Ilocos 100.00 3.90 C.60 5.61 0.53 0.59 19.97 0.42 0.54 1.89 58.29 7.66 62.12

Cagayan Valley 100.00 3.32 1.29 4.60 2.73 0.88 9.59 1.29 4.32 14.82 37.32 19.54 47.09

Central Luzon 100.00 3.27 1.33 6.50 4.09 1.07 17.58 3.;3 6.62 6.19 21.58 28.34 35.75 Southern Tagaog 100.00 4.93 1.77 9.06 3.7! 0.61 15.12 2.01 0.87 8.C5 42.97 10.86 48.40 Bicol 100.00 4.95 2.11 8.06 1.33 0.67 14.22 0.66 2.80 7.92 43.70 13.60 60.50 Eastern Visayas 100.00 4.81 1.00 9.46 3.50 1.19 10.62 0.55 1.61 6.19 47.45 13.61 54.26 Western Visayas 101.00 3.93 2.04 8.S8 6.89 0.78 18.91 5.15 5.43 5.12 33.43 9.34 38.10 Northern & Eastern Mindanao 100.00 4.97 0.94 5.95 1.74 1.10 8.04 0.6C 3.41 12.30 41.63 19.12 51.19 Southern & Mindanao Western 100.00 3.79 0.97 8.41 2.14 0.29 3.44 0.47 2.15 16.16 47.68 14.50 54.93

80MCEs DARR, DIVISION OF AGRICULTURAL ECONCHICSI STAWD RESEARCH IESTITUTE O g. In summary it is estimated that 56 percent of the palay was held for consumption and other uses or was marketed locally. The following tabulation summarizes the derivation of these estimates.

Disposition of Palay from Palay Farms

Held or Sold to Marketed Locally Palay Dealers Disposition % of Total Production % of Total Production

Consumed by family 36.80 - Residual 8.46 8.46 Seeds 2.02 2.02 Animal feeds .73 .73 Harvesting 3.86 3.86 Threshing 1.86 1.86 Hauling .42 .42 Rent to landlord ) Repayment of loans and ) interest to landlords) 1.85 26.65 Repayment of loans and ) interest to others ) Sold to creditors )

Total 56.00 44.00

Source: Stanford Research Institute, Appendix III-B

PREVIOUS PAgE BLANK Appendix III-B

Estimate of Amount of Palay Milled in Kiskisans

From the analysis of the quantity of palay and rice held or marketed locally by farmers and hired laborers the estimate of 56 percent of the total production of palay of the Philippines was derived (See Appendix III-A). From this figure it is possible to estimate the total amount of palay milled in kiskisans.

As part of the survey of the disposition of palay the Division of Agricultural Economics obtained data on the percentage of palay milled by various methods. These percentages are shown in the following lable III-B-I.

The percentages set forth do not represent the relative amount milled by var.ius methods of total production for the Philippines as a whole, but only of that amount held or marketed by the farmer. There­ fore, it is suggested that these percentages should be applied against the 56 percent of palay estimated in Appendix III-A. The reason for this conclusion is that practically all other palay moves through palay dealers. These dealers will almost invariably mill palay at a cono because of higher milling results.

On the basis of this conclusion the amount of palay would be equal to 52.4 percent of 1,800,000 metric tons (56 percent of total palay production) or 943,200 metric tons. In total 29.5 percent of all palay was milled in kiskisans.

PREVIUS PA EB . Table III-B-I

PERCENTAGE DISTRIBUTION OF MILLING OF RICE BY METHOD USED AND BY REGION, 1954-1955

Percentage Distribution of Milling of Rice by Method Used and by Region, 1954-1955

Hand Hilled Milled Region Pounded In Cono In Kiskisar Forcent Percent Percent

Philippines 38.37 9.23 52*40

Ilocos 57.23 0.21 42.56

Cagayan Valley 29.97 2.32 67.71

Central Luzon 12-36 18.67 68.97

Southern Tagalog 14.29 13.40 72.31

Bicol 54.66 2.52 42.82

Eastern Visyas 75.92 5.81 18.27

Western Visayas 38.83 8.49 52.68

Northern and Eastern Mindanao 66.68 10,49 22.83

Southern and Wostern Mindanao 54.11 5.55 40.34

Source: DANR, Division of Aricultural Economics

46 Appendix III-C Appendix III-C

Movements Detailed Analysis of Interprovincial and Interregional of Palay and Rice through Palay Dealers

as the amount of production Surplus production of palay is defined require in excess of gross consumption requirements. Gross consumption on the per­ ments are comprised of human consumption requirements based centage of rice-eating population in each province; seed requirements; of Agricultural animal feeds; industrial uses; and wastes. The Bureau Resources has Economics of the Department of Agriculture and Natural or deficit of palay for each published the estimates of the net surplus province shown on Table III-C-I.

are shown or The net surplus and deficit of rice for each province III-C-I serves as an initit Figure 111-2. This map combined with Table throughout the indicator of the interprovincial movements of rice Philippines.

the surplus esti- In order to estimate tonnage of these movements as well as rice move, mates have been adjusted to take account of palay trucking firms, ments. From interviews with palay and rice merchants, that about 20 percent o: and government personnel it has been estimated is in the form of the interprovincial movement of surplus production of cleaned rice. These estimate palay while 80 percent is in the form 525,500 metric ton are shown on Table III-C-II. In total an estimated in the Philippine of palay and rice were shipped between provinces Archipelago,

on Luzon and Adjacent Interprovincial Movements of Palay and Rice Islands

adjusted for In total according to surplus and deficit estimates metric tons of palay and rice palay and rice percentages about 350,000 and adjacent islands. combined were shipped between provinces of Luzon

J ~N -Legend. (metric tons)

Surplus: Deficit: 50,000 50,000

-- 20,000 - 20.000 10,000 - 10,000 0 - O

0

aL-

FIG. 111-2 NET SURPLUS AND DEFICIT RICE PRODUCTION 1955

50 Table III-C-I

PALAY AND RICE: SURPLUS AND DEFICIT PRODUCTION BY PROVINCE CROP YEAR 1954-1955 (000's Omitted) r 1 1 I, F Palay Clean Rice -ross Gross Net Production Consum-ption Net Surplus Region and Consumption Surplus or Column Requirements or (Deficit) Province Produvtior. Requirements (Deficit) 2 x .0286 Col, 2 x .0286 Col. 3 x .0286 I 4 1 Cavans Cavans Cavans etric Tons Metric Tons Metric Tons

Philippines 72,793 72,270 523 2,082 2,067 15

'.anila 4,161 (4,161) 119 (119) 2 5 Ilocos 2,580 3,922 (1,342) 74 112 (38)

Abra 560 366 194 16 10 5.5 Batenes .8 11 (11) .02 .3 (.3) Ilocos Norte 647 1,175 (528) 18.5 34 (15) Ilocos Sur 709 1,279 (570) 20 36.5 (16) La Union 663 1,090 (428) 19 31 (12)

Cagayan Valley 7,040 3,486 3,554 201 100 102

Cagayan 1,827 1,115 712 52 32 20 Isabela 2,494 988 1,506 71 28 43 1ountain Province 1,547 946 601 44 27 17 Nueva Vizcaya 1,172 436 735 33.5 12 21

Central Luzon 19,605 13,566 6,039 561 388 173 Bataan 260 417.5 (157) 7 12 (4) Bulacan 2,476 1,952 524 71 56 15 Nueva Ecija 5,969 2,419 6,549 171 69 101.5 Pampanga 2,409 2,048 361 69 58.5 10 Pangasinan 5,999 4,482 1,517 171.5 128 43 Tarlac 2,047 1,599 448 58.5 46 13 Zambales 444.5 649 (204) 13 18.5 (6)

Source: D,'NR, Division of Agricultural Economics. Table III-C-I (Continued)

Palay Clean Rce Gross Gross Het Production uconsu mption Net Surplus Region and Consumption Surplus or Column Requirements or (Deficit) Province Production Requirements (Deficit) 2 x .0286 Col. 2 x .0286 Col. 3 x .0286

Cavans Cavans Cavans Letric Tons Metric Tons Metric Tons

Southern Tagalog 8,292 11,485.5 (3,194) 237 328 (91)

Batagas 1,744 2,296 (552) 50 66 (16) Cavite 1,360 1,256 104 39 36 3 Laguna 953 1,404 (451) 27 40 (13) Marinduque 133 374 (241) 4 11 (7) Mindoro Occidental 255 206 49 7 6 1 Mindoro Oriental 875 621 255 25 18 7 Palawan 326 5C4 (178) 9 14 (5) Quezon 1,293.5 1,862.5 (369) 37 53 (16) Rizal 1,352 2,962 (1,610) 39 85 (46) Bicol 5,446 6,145 (699) 156 176 (20)

Albay 975 1,438 (465) 278 41 (13) Canarines Norte 210 439 (229) 6 12.5 (6.5) Canarines Sur 2,902 2,342 560 83 67 16 Catanduanes 116 393.5 (278) 33 78 (8) 1asbate 401 552 (151) 11 16 (4) Sorsogon 844 980 (136) 24 20 (4)

Eastern Visayas 6,863 7,E66 (1,003) 196 225 (29)

Bohol 1,738.5 1,356 382.5 50 39 11 Cebu 198 774 (575.5) 6 22 (16) Leyte 2,857 2,955 (98) 82 84.5 (3) Samar 2,069 2,781 (712) 59 79.5 (20) Table III-C-I (Continued)

Palav Clean Rice Gross Gross Net Production Consumption Net Surplus Region and Consumption Surplus or Column Requirenents or (Deficit) Province Production Reauirements (Deficit) 2 x .0286 Col. 2 x .C266 Col. 3 x .0286

Cavans Cavans Cavans Metric Tans Metric Tons Metric Tons

Western Visayas 10,779 11,179 (400) 308 320 (11)

Antique 975 1,030 (55) 28 29 (1.5) Capiz 2,258 2,061.5 196 64.5 59 6 Iloilo 4,534 3,634 899.5 130 104 26 Negros Occidental 2,398 3,470 (1,072) 68.5 99 (31) Negros Oriental 238 498 (261) 7 14 (7) Romblon 376 465 (109) 11 14 (3)

Northern & Eastern Mindanac 5,202.5 4,686.5 516 149 134 15

Agusan 628 351 296 18 9 8 Bukidnon 953 10905 845 27 3 24 Lanao 1,658 1,457 201 47 42 6 Misenis Occidental 407 658 (251) 12 18 (7) !1samis Oriental 185.5 1,085 (897) 5 31 (26) Surigao 1,369.5 1,046 323.5 39 30 9

Sou thern & Western 1dindanao 6,986 5,772 1,214 200 165 35

Cotabato 3,874 1,544 2,331 111 44 67 Davao 1,092 1,388 (296) 31 40 (8) Sulu 450 977 (526) 13 28 (15) Zamboanga del Norte 549 610 (61) 16 17 (2) Zamboanga del Sur 1,020 1,253 (234) 29 36 (7)

I ______1. .1 Table III-C-II

ESTIMATED SURPLUS AND DEFICIT PRODUCTION OF PALAY AND RICE COMBINED BY PROVINCE, 1955

SURPLUS PRODUCING DEFICIT PRODUCINiG PROVINCES PROVINCES

Abra 6,200 thinila 131,00 Cagayan 22,500 Batanes 400 Isabela 47,700 Ilocos Norte 16,700 b. Province 19,00 Ilocos ,u-. 18,000 Nueva Vizcaya 23,300 La Union 13,600 Bulacan 16,600 Bataan 5,000 Nueva. Ecija 112,400 Zambeles 6,500 Pampanga 11,400 Pangasinan 48,100 Batanges 17,500 Tarlac 11,200 laguna 14,300 ithrinduc'ue 7,600 Cavite 3,300 Palawan 5,700 Mindoro Occidental 1,600 Quezon 11,700 Nindoro Oriental 8,100 Rizal 51,000

Camarines Sur 17,700 Ilbar 14,700 Canrineg Norto 7,300 Bohol 12,100 Catandunos 8, E00 lhasbate 4,800 Cepiz 6,200 Sorsogon 4,300 Iloilo 28,500 Cebu 18,200 Agusan 9,400 ley e 3,100 26,700 Samar 22,600 Lanao 6,400 Surigao 10,300 Antique 1,700 Negros Cccidenttl 33,900 Cotabato 73, 00 Heuro- C irntel F,300 Ro.-iblon 3,400

Mar -,ii: Cocidental 7,O0 1-isoin- 'rievnte 2L,400

Davao 9, 4CO Sulu 16,700 Zrriibo-n-a de Horte 1,900! I- Zambomnua dol )r' TOTAL 525, 502.600507.400

1/ Total surplus or deficit of palay production cP.ju!ted: 2C of total surplus or deficit pnlay plus 80% of total surplus or deficit rice equivalent.

SOURCES: Table . . Stanford Research Institute

54 Cagayan Valley and Central Luzon Provinces to Manila, Southern Tagalog Provinces and the Bicol Region

On Luzon and adjacent islands 59 percent of the palay of the Philippines was produced during the crop year 1954-1955. The major interprovincial movement of palay and rice in this area was southbound from the provinces north of Manila. An estimated 261,600 metric tons of palay and rice combined were shipped from Cagayan Valley (Cagayan, Isabela, Mt. Province, and Nueva Vizcaya) and the Central Plain of Luzon (Pangasinan, Nueva Ecija, Tarlac, Pampanga and Bulacan) to Manila and the deficit provinces in the southern part of Luzon.

Manila, the largest single deficit area and the major distribution center for rice of the Philippines, received an estimated tonnage of 131,800 metric tons of palay and rice combined from northern provinces. The southern Tagalog provinces of Laguna, Batangas, Rizal, and Quezon received shipments from the north totaling 94,500 metric tons while 13,300 metric tons were -Dhipped to Palawan and Marinduque. Finally 22,200 metric tons were shipped to the deficit provinces of the Bicol region, Albay, Camarines Norte, Catanduanes, Sorsogon and Masbate.1/

This movement of palay and rice, from north to south, formed a complex pattern through numerous dealers. The palay was milled in every province and in particular in the large conos of Bulacan province. Private proprietary trucks transported most of the rice and palay from the north to Manila and to the provinces of Laguna, Batangas, Rizal, and Quezon. The northern lines of the Manila Railroad carried only about 9,000 metric tons during 1955. Water shipments from Aparri approximated about 5,000 metric tons. Shipments to the Bicol region were by rail and interisland steamer and, of course, those to Palawan and Marinduque were by water transport.

This north-south movement of palay and rice constituted, by a con­ siderable margin, the largest movement of domestic food crops in the islands. In.addition to these shipments north to south, there weresize­ able shipments between provinces north of Manila, in the Bicol region and from Cavite and Mindoro.

1/ Camarines Sur supplied approximately 17,700 metric tons of palay and rice combined to the deficit provinces of the Bicol region. See page 56.

55 Cagayan Valley and Central Luzon Provinces to the Ilocos Region, Zambales, and Bataan

The surplus production of Cagayan province met, in large part, the deficit requirements of Ilocos Norte. Shipments were by truck north and west over the northern tip of Luzon. From Pangasinan rice and palay moved north to La Union, Ilocos Sur, and Ilocos Norte. The deficit of Ilocos Norte and Ilocos Sur was also partially met by shipments from Abra. Northern Zambales received rice from Dagupan, Pangasinan and Pampanga and Tarlac supplied Bataan and southern Zambales. In total these shipments were approximately 60,000 metric tons of palay and rice, combined, during 1955.

In summarizing the movement of rice and palay in the area north of Manila, a.highly complex pattern of milling and distributiln can be noted. For example, palay and rice from the Cagayan provinces moved in large part to markets in Pangasinan and Nueva Ecija and were then distributed to numerous markets. There was no simple one-way directional flow. However, if the surplus-deficit estimates are reasonably correct the result is a net flow in the directions described above.

Camarines Sur to Other Bicol Provinces

In the Bicol area, Camarines Sur constitutes the rice bowl. AV­ proximately 17,700 metric tons were shipped from this province principally to Albay and Camarines Norte. Trucks and rail were the principal trans­ port facilities used. As noted above the surplus of Camarines Sur was not sufficient to meet the deficit of the Bicol region as a whole. Shipments from Manila were made to Masbate, Catanduanes and Albay by interisland vessels as well as some shipments by rail.

Cavite and Mindoro to Manila and Other Deficit Areas of Luzon

The small surplus production of Cavite and Mindoro provinces sup­ plied Batangas or moved to Manila for distribution to other provinces. The total of these shipments was approximately 13,000 metric tons. Interprovincial Movement of Palay and Ri in the Visayas and Mindanao

According to the surplus and deficit estimates approximately 175,000 metric tons of palay and rice combined moved between provinces in the Visayan-Mindanao area.

Interregional Movement between Visayas

Iloilo, Capiz and Bohol are the surplus producing provinces of the Visayas. In the crop year 1954-1955 an estimated 46,800 metric tons was shipped from these three provinces to deficit areas in the Visayas. Most of the surplus from Iloilo was shipped to Negros Occidental; small shipments were sent by truck to fill the deficit to Antique province of approximately 1,700 metric tons. Shipments to Negros Occidental from Iloilo were about 26,800 metric tons.

Capiz shipped about 6,200 metric tons to Romblon, Negros and Cebu combined, while about 12,100 metric tons went from Bohol to deficit areas throughout the Visayas and partially to Misamis Oriental.

The surplus of Iloilo, Capiz and Bohol was not sufficient to meet the deficit of the Visayas. Approximately 45,000 metric tons of palay and rice were supplied from Mindanao to meet the remaining deficit of Negros Occidental, Cebu, Leyte adid Samar.

Movement of Palay and Rice Between Provinces of Mindanao and the Visayas

Cotabato was the principal surplus producing province of Mindanao and supplied the largest percentage of the net deficit of the Visayas. Shipments from Dadiangas, Cotabato, and Lebak approximated 25,600 metric tons, while Surigao shipped about 10,300, Agusan 8,600 and Lanao about 500 metric tons.

The shipments from Cotabato to the Visayas were shipped primarily to Cebu and then transshipped to other deficit areas such as Negros Occidental and Negros Oriental; while Surigao and Agusan supplied western and southern Leyte.

57 Movement of Palay and Rice Between Provinces of Mindanao

Misamis Oriental and Misamis Occidental were the two deficit areas of northern Mindanao. An estimated total of 26,700 metric tons from Bukidnon, supplemented by small shipments from Agusan and Lanao total­ ling about 1,700 metric tons met most of the deficit requirement of Misamis Oriental.

Misamis Occidental received about 5,000 metric tons from Lanao and an estimated 3,000 metric tons from the area around Pagadian, Zamboanga del Sur. Although Zamboanga del Sur, taken as a whole province, was a deficit area the northern part was a surplus-producing region.

Sulu, Zamboanga City, northern Zamboanga del Norte and the southern part of Zamboanga del Sur were the deficit areas of western Mindanao. Shipments from Cotabato estimated at 29,000 metric tons met most of this demand for palay and rice.

Davao was the deficit area of southern Mindanao. Approximately 9,400 metric tons were transported to Davao from Cotabato by truck and by water transport during the crop year 1954-1955.

Estimates of Interprovincial Movement by Interisland Vessel Shipments to and From Manila

Table III-C-III sets forth the estimates of rice shipments to and from the port of Manila during 1955. These figures have been derived from data compiled from manifests of interisland vessels by the National Rice and Corn Corporation. The original data were in sacks and have been converted by multiplying by 56 kilograms. Even with this upward bias the totals may be understated as much as 50 percent. In any case, these data afford a reasonable picture of the pattern of movement to and from Manila.

First, most of the shipments from Manila were to deficit areas such as the Bicol region, eastern Visayas, Negros, Romblon, and Palawan. Table III-C-III

INWARD AND OUTWARD SHIPMENTS OF RICE, MANILA, 1955 (Metric Tons)

To Manila From Manila

Northern Luzon 4,655 43 Cagayan 4,655 -- Batanes - 43

Southern Tagalog 249 2,653 Marinduque 25 424 Mindoro Occidental 24 116 Mindoro Oriental 107 i49 Palawan 93 1,964

Bicol Region 170 15,933

Albay 12 8,181 Camarines Norte - 648 Camarines Sur 9 184 Catanduanes 28 2,380 Sorsogon 25 2,816 Masbate 96 1,724 Eastern Visayas 656 3,137 Cebu 399 2,520 Bohol 3 4 Leyte 71 366 Samar 183 247 Western Visayas 770 2,112

Capiz 413 57 Iloilo 233 256 Negros Occidental 109 1,066 Negros Oriental 3 24 Romblon 12 709 Northern and Eastern Mindanao 5,092 820 Agusan 7 148 Surigao 45 254 Misamis Oriental 191 367 Misamis Occidental 3,950 36 Lanao 899 15

59 Table III-C-III (Continued)

INWARD AND OUTWARD SHIPMENTS OF RICE, MANILA, 1955 (Metric Tons)

To Manila From Manila

Southern and Western Mindanao 19,651 981

Zamboanga del Norte 4 20 Zamboanga del Sur 69 41 Sulu 29 652 Cotabato 11,233 97 Davao 8,316 171

Grand Total 31,243 25,679

Source: National Rice and Corn Corporation; Stanford Research Institute.

60 Second, a majority of shipments to Manila were from surplus areas such as Cotabato and Cagayan. The most important exception is Davao. This may be accounted for by seasonal movements.

Third, most of the shipments are one-directional. For example, Cotabato shipped 11,233 metric tons to Manila and received only 97; Bicol received 15,933 metric tons while only 170 metric tons were shipped from Bicol to Manila; eastern Visayas received 3,137 metric tons and only 656 metric tons were shipped from the same provinces; Cagayan shipped 4,655 metric tons to Manila and no shipments were sent to Aparri.

Fourth, even if the figures are doubled in tonnage a large pro­ portion of the small shipments would constitute no more than small lot shipments collected by interisland vessels on regular routes.

Estimates of Interprovincial Shipments of Palay and Rice to Cebu

Table III-C-IV sets forth estimates of rice shipments to the port of Cebu derived from a special study conducted for Stanford Research Institute. The original data were in sacks and have been converted to metric tons by multiplying by 56 kilograms per sack. These figures are probably not understated.

These data give an indication of the complexity of the pattern of palay and rice shipments in the Visayan-Mindanao area.

First, the largest shipments originate in Cotabato province. However, the tonnage was about half the total indicated by the surplus and deficit estimates. This can be accounted for by a number of other shipments. For example, Manila shipped over 6,000 metric tons to Cebu and received over 10,000 from Cotabato. In effect, Manila may be a distributing center to a large extent espedially when seasonal factors are considered. In addition, the shipments from Lanao and Misamis Occidental were greater than the surplus and deficit estimates indi­ cate. This could have been due to shipments from Pagadian, Zamboanga del Sur to Iligan and Ozamis. Thus the deficit in Zamboanga del Sur, particularly Zamboanga City, was greater and shipments from Cotabato were received to fill this deficit. In summary, particular surplus and deficit areas as well as a complex mark ting pattern were indicated.

61 Second, only small shipments were received from Surigao and Agusan while sizeable shipments, percentagewise, were received from ports on the southern and western coast of Leyte. This may be accounted for by Surigao and Agusan shipments to Leyte to fill the net deficit of this province.

Third, the small shipments from Bohol indicate that the surplus of Bohol may be overstated.

62 Table III-C-IV

SHIPMENTS OF RICE TO CEBU BY PROVINCE AND PORT 1955

REGION, PROVINCE & RICE REGION, PROVINCE & RICE PORT METRIC TONS PORT METRIC TONS

VISAYAS 7o610 MINDANAO (Cont.) Bohol 103 Dadiangas 5,740 Tagbilaran 60 Lebak 35 Others 43 Davao 2,993 Leyte 3,865 Davao 2,993 Ormoc 2,038 Agusan 27 Calubian 247 Lanao 5,508 Palompon 149 Iligan 4,268 Baybay 120 Tubod- 1,231 Einatuan 102 Others 9 Tacloban 977 Misamis Oriental 201 Others 232 Cagayan Samar 51 Misamis Occidental Allen Ozamis 953 Others 31 Oroquieta 127 Negros Oriental 90 Others 98 Dumaguete Surigao 34 Others 10 Surigao 26 Iloilo 2,890 Others 8 Iloilo 2,890 Sulu 17 Capiz 611 Jolo Zanboanga del Sur 1,068 LUZON 6,795 Pagadian 1,024 Manila 6,744 Zamboanga City 44 Albay 51 Zanboanga del Norte 722 Legaspi 51 Dipolog 330 Sindangan 281 MINDANAO 22,352 Lalbason 108 Cotabato 10,604 Others 5 Cotabato TOTAL - - - - 56,757

Source: Special study conducted for Stanford Research Institute. Appendix III-D

PREVIOUS PAE .AR Appendix III-D

Discussion of Major Assumptions Underlying Projections of Total Palay Production

The projections of total production of palay for the years 1961 and 1966 involve three assumptions in addition to the basic assumption that national income will increase over the next decade.

(1) Per capita rice requirements will remain stable over the decade 1957-1966.

(2) Domestic production of rice will increase sufficiently to supply total requirements, i.e. there will be no net imports of rice on the average 1957-1966.

(3) Domestic production will not exceed total domestic require­ ments, i.e. there will be no net export of rice on the average 1957-1966.

These assumptions appear reasonable for the following reasons.

Per Capita Rice Requirements

Changes in per capita requirements are a result primarily of in­ creases or decreases in consumption per person. Variations in allowances for seed, animal feed and industrial and other uses should not change sufficiently to alter per capita requirements.

Consumption per person depends on the percentage of the population which is rice-eating as well as the quantity of rice consumed by persons included in the rice-eating population.

The projection of trends for the percentage of population which is rice-eating and the amount of rice consumed per person of the rice­ eating population can be no better than an informed guess. Data are not available on the changes in these phenomena since 1939.1/ However,

1/ National Economic Council, Office of Statistical Coordination and Standards, See Report of Rice Production and Consumption for Crop Year 1956,,April 3, 1956.

67 certain factors may be cited which point to stability in per capita requirement3 over the next decade. The trend of per capita requirements between 1940-1956 shows no marked changes. (See Table III-II of Section III). Moreover, on the basis of the trend shown, the increase from 95.62 to 98.00 kilograms between 1939 and 1956 probably accounts for any additional increases for the decade 1957-1966.

In respect to the percentage of population which will be rice­ eating, the major shift would probably occur from corn consumption to rice consumption. Corn consumption is concentrated in areas where rice production cannot easily be substituted for corn e.g. Cebu, and where other economic activities will not likely displace corn production. Therefore, any shift to rice consumption would depend principally on those areas wherc only a small percentage of the population presently consumes corn as the principal food crop. Given the assumption that National Income will increase, this may appear probable although the change in percentage should not be large. Under the same assumption, however, indications are that with an increase in National Income greater consumption of foods other than cereals is likely to occur. A recent study srows that cereals (rice and corn) comprise a signifi­ cantly greater percentage of the total diet than is desirable.!/ Thus with an increase tn income the quantity of rice consumed by persons presently included as part of the rice-eating population may decrease. Therefore, it has been concluded that per capita requirements remaining the same over the decade 1957-1966 is a reasonable assumption.

Domestic Production of Palay and Rice

Table III-D-I sets forth the total production and per capita production of palay; yield per hectare and area planted to palay 1939­ 1956, and the projected quantity for the years 1961 to 1966. The projected changes constitute reasonable extrapolations of the past trends.

1/ A Study of the Nutritional Targets Set Monthly by the Institute of Nutrition, the Department of AgricultL .e and Natural Resources and The National Economic Council.

68 Table III-D-I

PALAY: TOTAL PRODUCTION, PER CAPITA PRODUCTION, YIELD PER HECTARE AND AREA PLANTED, 1939-1966 (CAVANS)

Total Per Capita Yield Per Area Production Production Hectare Planted Year (Cavans) (Cavans) (Cavans) (Cavans)

1939 52,193,430 3.23 26.6 1,965,480 1940 53,698,780 3.26 25.8 2,080,380

1946 36,893,940 2.00 22.4 1,649,960 1947 47,460,000 2.52 25.3 1,879,600 1948 50,928,480 2.66 25,1 2,026,380 1949 56,620,200 2.90 26.2 2,164,100 1950 59,228,600 2.98 26.8 2,214,000 1951 59,463,400 2.94 26.4 2,251,800 1952 64,335,120 3.12 26.1 2,466,040 1953 71,458,060 3.40 26.9 2,655,000 1954 72,328,000 3.37 27.3 2,645,440 1955 72,764,196 3.33 27.4 2,655,540 1956 73,429,636 3.30 27.1 2,709,060

1961 83,900,000 3.43 28.0 2,996,400

1966 92,100,000 3.43 29.0 3,175,800

Sources: DANR, Division of Agricultural Economics, Philippine Agricultural Statistics, 1954, Vol. I, pp. 26, 27; DANR, Division of Agricultural Economics, Selected Statistics on Rice and Weather Conditions, December, 1955; National Economic Council, Office of Statistical Coordination and Standards, Report of the Committee on Rice Production and Consumption for the Crop Year 1956, (Mimeographed) April 3, 1956; Bureau of Census and Statistics; Stanford Research Institute.

69 In respect to the projections for hectarage devoted to palay and yield per hectare, even if it were assumed that productivity were to remain stable the hectarage which would be required to yield the pro­ jected total production does not exceed new land available for rice production. Furthermore, if productivity increases faster than in the past, the probability will be higher for domestic production to supply total domestic requirements.

Possibility of Net Rice Exports

The export of rice in significant quantities would require pro­ nounced departures from past trends in the production of palay. The Philippines has not been a net exporter of rice since the early 19th century. In the event palay production for export did occur, however, it would depend primarily on increases in yield per hectare. Palay producers could not compete successfully on world markets if production for export depended upon hectarage increases alone. Yield per hectare of all major exporters of rice was above the productivity in the Philippines in 1953 by at least 3 cavans per hectare./

Moreover, in order to produce a surplus of rice for export, rapid and sharp increases in yield per hectare would probably be required to offset the possible decreases in production resulting from the elimina­ tion of marginal rice producers.

Finally, even if such sharp increases in yield per hectare were achieved, competition between Philippine producers and producers in countries well established in the world market for rice such as Burma, Thailand, and Vietnam would tend to dampen incentives of domestic rice producers. With alternatives for diversification into other crops, which is possible in the Philippines, it appears more probable that producti3n of other crops would occur before rice production for export. Therefore, a reasonable assumption seems to be that net exports of rice will not occur over the next decade.

1/ DANR, Division of Agricultural Economics, Philippine Agricultural Statistics, 1954, Vol. I, Table 42, pp. 31, 32.

70 Appendix III-E

Anticipated Changes in Regional Patterns of Palay Production, 1957-1966 Table III-E-I

PAIAY: PRODUCTION BY REGION AND PROVINCE, 1938-1956 (Cavans)

1938-42 1948-2 1953-86 Percent increase Percent Incrase Reglon and Province Average Average 1953 1954 1955 1956 Average 1938-42 to 1948-82 1938-42 to 1953-56 lippines Phi 51,401,660 58,115,160 71,458,060 72,323.000 72.793.320 73.557.850 72,534,307 13.1 41.1 Manila

Ilocos 2.,10.640 3,257,584 3,733.690 1,833,500 2.580,400 2,544.520 2,673,028 8.2 Abra 281,200 37.716 12.6 (Decrease) 324.520 296,87, 5g60,260 592.310 443,490 Batanes 7.9 1,860 956 900 5.0-,0 B00 i77 750 1.680 94.6 (Decrease) 1.1 Ilocos Norte 1,095.370 1,253994 1.539,610 539,920 647,360 663,620 847625 14.5 Ilocos Sur 827,280 825,376 1.013,780 527,750 709,380 653,160 29.2 (Decreasi) 726,018 0.2 (Decrease) 13.9 (Decrea) La Union 804,930 789,542 854,880 463,890 662,600 634,680 654,012 1.9 (Decrease) 23.1 (Decrease)~ Cagayan Valley 4,126,670 4.562,488 6.816,7S0 7,824.20075 6,61o,160 10.6 71.4 Cagayan 1,474,530 1,454,138 2.231,100 2,442,220 1.826,790 1.550,040 2,012.538 L.4 (Decrease) Isabela 1.303,440 1.353,468 2.475,511U 36.5 3.092430 2,494,310 2,402.470, 2.616.180 3.8 Mountain Province 661,820 806.772 849,980 1,110.460 1,547.170 L,489.940 L.249,387 21.9 100.7 Nueva Viscaya 686,880 948.110 1,260,160 1,179,090 1,171,620 88.8 1,167,710 1.194,645 38.0 73.9

Central Luzon 19,521,750 18.838.410 11.702.720 19.220.100 '9.605.140 20.031,160 20.139.780 3.6 (Decrease) Pangasonan 5,005,650 5.760.228 6,895,800 6,005,360 .3,99, 270, 5.676,540 6F.144.242 15.1 3.2 Nueva Ecija 7,023,240 5.653.508 7,076,230 4,810,530 5,968,760 6.373,560 6.058,558 24.2 (Decrease) H2.7 Paxpanga 2,159,010 2,217,292 2.155,310 2-,020,000 2.409,360 2,427,560 2.255.555 2.7 15.9 (Decrea&") Tarlac 2,070,690 1.935,168 1,821,640 2,966,590 4.5 2.096,620 2,223,440 2,264.572 5.4 (Decrease) 9.4 Bulacan 2,328,030 2,377,512 2,652,540 2,375,500 2,476,150 2,477,200 2,495,348 2.1 7.2 Batano. 293,450 341,914 414,250 440,720 260,420 272.110 346.900 15.1 (Decrease) Zambales 541,580 522,788 696,710 13.4 (DeCrwaae) 591,400 444,560 573,750 574,605 3.6 (Decrease) 6.1 CA3 Southern Tagalog 5 6 4 9.137,43 80936.900 8,291,710 7,977,460 Batangas 8,335,77 18.0 59.5 768,510 1,290,440 2,181,650 2,088,130 1.743,960 1,733,580 1,937,330 67.8 152.0 Cavite 831,930 1,017,522 1,479,990 1,486,620 1,359,760 1.387,240 1,428,403 22.3 Laguna 71.7 977,640 744,180 788,710 1,134,440 653,390 953,670 957,553 31.4 (Decrease) 2.1 (Decrease) Marinduque 161,490 187,436 64,270 286,720 133,070 128,640 158,178 16.1 Mindoro 677,340 756,916 1,070,780 1,312,280 2.1 (Decrea&e) 1,130,190 1,167,890 1.170,285 11.7 72.8 Palawan 112,330 217,080 463,630 482,230 325,740 384.,800 415,597 93.3 270.0 Quezon 964,670 1.162,504 1,343,900 1,251,380 1,293,510 1.292,820 1,295,402 20.5 34.3 Rizal 731,110 788,466 718,510 894,690 1,352,090 926.820 973,027 7.8 33.1 7 Bicol 3, 7 4,2,8 3.599960 6,010,100 5.445,630 6,201,810 3.311925 35.1 Albay 720.340 790,242 66.1 664,510 810,710 972,850 1,109,320 889,347 9.7 Camarines Norte 192,770 299,226 160,390 23.5 300,060 209.990 393,450 265,972 55.2 38.0 Canmarines Sur 1,453,840 2,300,76- 2,016,500 3,025,880 2,902,020 3,297,800 2,810,550 58.3 93.3 Catanduanes 96,760 103,820 104,200 319,010 115,890 115,890 163,748 7.3 69.2 Masbate 175,080 266,054 262,950 498.690 400,880 400,750 390,820 52.0 123.2 Sorsogon 559,080 560,674 381,400 1,055,750 844,200 884,600 791,488 0.3 41.6 Ea-tern Visayas 3,2,3 4,919444 5.636,480 5.917.300 6,6,5 7,523.990 6,486,2355 35.7 78.9 Bohol 967,990 1,467,878 2,395,500 2,5-5,470 1,738,550 1,777,680 2.119,300 5L.6 118.9 Cobu 94,000 128,740 129,080 107,130 198,310 204,240 159.690 37.0 69.9 Leyte 1,365,120 1,971,760 1,589,480 1,889,400 2,856,960 3,203,370 2.384,803 44.4 74.7 Samar 1,199,120 1,351,066 1,522,420 1,355,300 2,068,830 2,343,700 1,822,562 12.7 52.0 Table III-E-I (Continued)

PAIAY: PRODUCTION BY REGION AND PROVINCE, 1938-1956 (Cavans)

1938-42 1948-52 1953-56 Percent Increase Percent In Region and Province Average Average 1953 1954 1955 1956 Average 1938-42 to 1948-a2 1938-42 to

7 Western Visayas 7.255.73 9 10,321,2: 11,261,100 10.779.250 10.229.900 0.4 26.5 46.8 Antique 697,290 712,842 1,092,400 1,557.340 975,400 975,240 1,150,095 2.2 64.9 Capiz 1,731,740 2,563,900 2,505,810 2,329,940 2,257,710 2,261,710 2,338,793 48.1 35.1 Iloilo 2,886.960 3,044,204 3,829,340 3,806,630 4,533,750 3.736,320 3,976,510 5.4 37.7 Negros Occidental 1,622,060 2.439,952 2,134,770 2,760,750 2,398,330 2,634,060 2,481,978 50.4 53.0 Negros Oriental 180,270 212,768 399,320 402,070 237,600 256,460 323,862 18.0 79.7 Romblon 137,410 207,426 359,590 404,370 376,460 366,110 376,632 51.0 174.1

Northern and Eastern Mindanao 2,618.980 3,001,402 4,131,630 6,522.200 5,202,590 5,229.050 5,271,367 14.6 101.3 Agusan 167,820 293.396 400,100 608,950 627,640 625,000 565,422 74.8 236.9 Bakidn.a 65,960 209,874 53,900 1,471,270 953.000 806,850 933,755 218.2 315.6 Lanao 1,242,520 1,138,134 1,393.100 1,853,270 1,657,670 1,56,940 1,640,245 9.2 (Decrease) 32.0 Misamis Occidental 314,120 349,076 449,300 803,190 407,160 414,570 518,555 11.1 65.1 Misanis Oriental 132,040 230,242 330,990 512,020 187,570 419.750 362,582 74.4 174.6 Surigao 696,520 780,650 1,054.240 1,273,500 1,369,550 1.305,940 L,250.803 12.1 79.6

Southern and Western Mindanao 2,818,370 3,869,412 7,388.170 4,803,000 6,985,860 6.59545 37.3 134.0 Cotabato 1,494,810 1,885,590 3,659,400 1,634,230 3,874,390 3,922,210 3,282,558 26.1 119.6 Cavao 281,880 355,976 711,470 1,359,750 1,092,340 1,021,440 1,046,250 26.3 271.2 Sulu 351,860 303,572 371,520 372,400 450,410 4t68,150 415,620 15.9 (Decrease) 18.1 Zmboanga Del Norte 689,820 1,324,274 738,730 473,140 549,0601 569,620 582,637 - - Zamboanga Del Sur --867050 963,480 1,019,660J 1,223,380 1,268,392 - - Zamboanga Provinces (Total) 689,820 1,324,274 2,605,780 1,436,620 L,568,720 1,733,000 1,85L,029 92.0 168.3 Table III-E-II

PALAY: AREA PLANTED TO PAIAY BY REGION AND PROVINCE, 1938-1956 (Hectares)

1938-42 1948-52 1953-56 Percent Increase Percent Increase Regoo and Province Average Average 1933 1954 1955 1956 Average 1938-42 to 1949-52 1938-42 to 1953-56

Philippines 2,096.720 2.224.464 2.655,000 2,645.440 2.655,540 2,709.020 2.666.250 6.1 27.2

Manila

Ilocos 113.460 122.366 131.030 105.810 100,850 99,760 109.360 7.8 3.7 (Decrease) Abra 13.410 14.534 16.040 15.600 21.210 22.440 18,922 8.4 40.4 Batanes 160 104 100 470 70 70 177 53.8 (Decrease) 10.6 1ocos Norte 36.080 44.436 48.020 32.910 31.020 31.600 35.887 23.2 0.5 (Decrease) Ilocos Sur 32.490 33.722 37.100 29,750 24.000 22,230 28.292 3.8 14.8 (Decrease) La Union 31.320 29,570 29,770 27,080 24,460 23.420 29.182 5.9 (Decrease) 19.6 (Decrease)

Cagayan Valley 166,530 160.744 227,110 216,060 237.340 216.060 224,198 3.6 (Decrease) 34.6

Cagayan 68,010 55,618 66,110 72.570 70.020 59.400 67.025 22.3 (Decrease) 1.4 (Decrease) Isabela 54.910 50.708 78.620 77,870 83,590 73,710 78.448 8.3 (Decrease) 42.9 Mountain Province 26.030 29.844 44.450 36.050 53,510 52.720 46,682 14.7 79.3 Nueva Vizcaya 17.580 24,574 37,930 29.790 30.220 30.230 32.042 39.8 82.3

Central Luzon 640.020 668.530 724.670 634.120 573.340 579,430 627.890 4.5 1.9 (Decrease)

Pangasinan 177.320 220.766 235,540 187.350 208.370 197.100 207.090 24.5 16.8 Nueva Ecija 207,390 183,764 213.560 163.570 154,790 162.510 178.607 12.9 (Decrease) 16.1 (Decrease) Pampanga 70.650 82.958 81.430 80.050 81.870 82.570 81,480 17.4 15.3 Tarlac 76.560 75.332 73.430 76,760 52.030 36.580 34,700 1.6 (Decrease) 74.110 Eulacan 75.738 86.200 74,220 56.240 56.300 68.240 2.2 18.3 (Decrease) Bat-s 11 .310 9.914 11.990 10.8..n 6.260 6,540 8.882 14.1 (Decease) 8.6 (Decrease) C Zaabalea 22.690 20.G48 22.620 21.330 13.780 17.630 18.690 13.1 (Decrease) 27.3 (Decrease) 20.1 (Deesee) Southern Tagalog 284,570 297,698 317.280 325.390 331.620 325.930 325.055 9.3 (Decrease) 14.2 Batangas 73,990 69,600 79.190 78,540 55.050 54,750 66.882 6.3 (Decrease) Cavite 43.490 40.77G 43.870 10.6 (Decrease) 44.570 42.730 42,090 43,315 6.7 (Decrease) Laguna 0.4 (Decrease) 34,680 21 .018 32.080 37.980 33.180 22.580 34.305 11.8 (Decrease) Marinduque 12.810 11.116 13.520 13.850 11.500 11.090 12,490 15.2 (Decrease) 2.1 (Deeae) Mindoro 35.800 2.6 (Decrease) 37,162 55.520 55.520 61.090 66.020 59,537 3.6 Pala.n= 8.980 14,190 24.190 25,150 20.260 23.850 23.362 58.0 66.3 Quezon (Tayahas) 49,500 42.638 47,870 160.2 46.990 66.G40 66,640 57.035 16.1 (Decrease) Rizal 25.320 21.198 21,040 15.2 22.790 40.770 27,910 28,127 19.4 (Decrease) 11.1 Bical 153,880 189.752 217,640 281.080 265,330 297,670 265,430 23.3 72.5 Albay 30.950 34.312 36.180 51.800 SS.980 63,390 51.637 10.9 Casarines Norto 9,520 13.154 67.5 7.430 20.450 11,840 22.230 15.487 38.2 62.7 Canartnes Sur 69.630 97.278 117.040 119.960 119.920 131.910 122.207 39.7 75.; Catanduanes 5,980 5.482 9.210 13.170 6.940 6.940 9,065 9.1 (Decrease) Masbate 9.390 14.234 20,500 29.780 27,140 27.600 25,255 51.6 179.6 Sorsogon 28.410 25.292 27.280 45.920 43.510 45.600 40,577 12.3 (Decrease) 42.8

Eastern Visayas 187,310 209.314 236.030 329.770 297.130 323,230 296.540 11.7 58.3

Bohol 39,600 76.892 89.340 115.040 93,710 95,570 98.415 29.0 65.1 Cebu 5 660 6,454 8,840 11.080 9.930 10.110 9.965 14.0 76.1 Leyte 63.870 69.624 77.500 102,380 103.260 115,650 99.697 9.0 56.1 Samar 58.180 5S.344 60.350 101.270 90.330 101.900 88.462 3.3 (Decrease) 52.0 Table III-E-II (Continued)

PAIAY: AREA PLANTED TO PA1AY BY REGION AND PROVINCE, 1938-1956 (Hectares)

1938-42 1948-52 1953-56 Percent Increase Percent Increase Region and Province Average A-ge 1953 i954 1955 1956 Average 1938-42 to 1948-52 1938-42 to 1953-56

Western Visayss 325.390 370.618 416.110 437,120 484.900 463.590 450,430 13.9 38.4

Antique 40.540 36.480 36.150 45.960 36.120 36.120 38.587 11.1 (Decrease) 5.1 (Decrease) Capis 66,430 92.928 95.990 87.270 107,190 107.190 99.410 39.9 49.6 loilo 134.380 138.696 172.880 181,030 189,170 155,680 174.690 3.2 30.0 Negro Occidental 65.480 85,770 82.930 93.120 119.190 131.050 106,572 31.0 62.8 Negros Oriental 8.360 7,824 13,480 16,510 11,610 12,510 13,527 6.8 (Decrease) 61.8 Romblon 10,200 3.920 14,680 13.230 21.620 21 040 17.642 14.3 (Decrease) 73.0

Northern and Eastern Mindanso 112,260 108,798 141,400 212.320 155.820 156,590 166,533 3.2 (Decrease) 48.3

Agusan 8.470 8,028 11,440 24,700 27.310 28,350 22.950 5.5 (Detresse) 171.0 Bukidmon 3,780 6,746 19,680 38,070 27.440 24,450 27.410 78.6 625.1 lanso 47,840 40,538 43,630 60,120 37,850 38,630 44.557 18.0 (Decrpase) 7.5 (Decrease) Misais Occidental 12.650 12.820 18.320 23.020 10,580 10.770 15.672 1.3 23.9 isLsais Oriental 5.750 6.525 9,180 16.520 5,010 11.040 10.438 13.5 81.5 Surigao 33,770 34.140 29,150 49.890 47.630 45,350 45.505 1.1 34.7

Southern and Testern indanso 113.300 126.644 243,730 103 550 209.2.0 246,760 200,812 11.8 77.2

Cotabato 51.160 58.322 121.150 38.170 103.650 123.130 96.525. 14.0 88.7 Davao 14,620 12.342 35.540 25,230 35,910 48.640 36,330 18.5 (Decrease) 148.5 Sulu 16.480 13.900 14,970 7.970 18.180 18.880 15.000 18.6 (Decrease) 9.9 (Decrease) Zamboangs Del Nort. 24.2001 11,2101 28.300 28.3001 23.0021 Zamboanga Del Sur 47.870J 20.970J 23.170] 27 810 29,955 Zamboanga Provinces Total 31.040 42.080 72.070 32,180 51.470 56.110 52.957 35.6 70.6

Sources: DANR, Division of Agricultural Economics. Philippine Agricultural Statistics. Vol. II, 1956. Bureau of Census and Statistics. Yearbook of Philtlapine Statistics 1946; DAN, Division of Agricultural Econonics; Stanford Research Institute. Table III-E-III

PALAY: PERCENT OF TOTAL AREA PLANTED BY REGION AND PROVINCE 1938-42; 1948-52; 1953-56

1938- 1948- 1953. 1938- 1948- 1953­ 1942 1952 1956 1942 1952 1956 Philippines 100.0% 100.0% 100.0% Bical 7.3% 8.5% 10.0% Manila Albay 1.5 1.5 2.0 Camarines Norte 0.5 0.6 0.6 Ilocos 5.4 5.5 4.1 Camarines Sur 3.3 4.4 4.0 Catanduanes 0.3 0.3 Abra 0.3 0.6 0.7 0.7 Masbato 0.4 0.6 Batanes 0.9 0 0.05 0.1 Sorsogon 1.4 1.1 1.3 Ilocos Norte 1.7 2.0 1.4 Ilocos Sur 1.5 1.5 1.1. Eastern Visayas 8.9 9.4 11.1 La Union 1.5 1.3 0.9 Bohol 2.8 3.5 3.7 Cagayan Valley 7.9 7.2 8.4 Cebu 0.3 0.3 0.4 Leyte 3.0 3.1 3.7 Cagayan 3.2 2.5 2.5 Bamar 2.8 2.5 3.3 Isabela 2.6 2.3 2.9 Mountain Province 1.3 1.3 1.8 Western Visayas 15.5 1g.7 16.9 Nueva Vizcaya 0.8. 1.1 1.2 Antique 1.0 1.6 1.4 Central Luzon 30.5 30.1 23.5 Capis 3.2 4.2 3.7 Iloi1o 6.4 6.2 6.0 Pangasinan 8.5 9.9 7.8 Negros Occidental 3.1 3.9 4.0 Nueva Ecija 10.0 8,3 6.7 Negros Oriental 0.4 0.4 0.5 Pampanga 3.4 3.7 3.1 Romblon 0.5 0.4 0.7 Tarlac 3.7 3.4 2.4 Northern & Eastern Mindanao 5.4 4.9 8.2 Bulacan 3.5 3.4 2.6 Bataan 0.5 0.5 0.3 Agusan 0.4 0.3 0.9 Zmbales 1.1 0.9 0.7 Dukidnon 0.2 0.3 1.0 Lanno 2.3 2.0 1.7 Southern Tagalog 13.6 12.0 12.2 Minamis Occidental 0.0 0.6 0.5 Misamis Oriental 0.3 0.3 0.4 Datangas 3.5 3.1 2.5 Surigno 1.0 1.5 1.7 Cavite 2.1 1.8 1.0 Laguna 1.7 1.4 1.3 Southern & Western Mindanao 5.4 5.7 7.5 Marinduque .3.8 0.5 0.5 Mindoro 1.7 1.7 2.2 Cotabato 2.4 2.6 3.5 Palawan 0.4 U.G 0.9 Davao 0.7 0.8 1.4 Quezon (Tayabas) 2.4 2.0 2.1 Sulu 0.0 0.6 0.8 Rizal 1.2 1.0 Il.1 Zamboanga (Total-Norte and Sur) 1.5 1.9 2.0

Notes: Detail may not add to totals due to rounding.

* Indicates less than one-half of one percent. Table III-E-IV

PAIAY: YIELD PER HECTARE BY REGION AND PROVINCE, PHILIPPINES 1938-1942; 1948-1952; 1953-1956 (Cavans per Hectare)

1938--4 1918-52 1953-56 ______

pHXIppiff' 12ICOL.: 22.8 .ilbay 23.3 23.0 17.0 Camarines Norte 20.2 17.4 17.2 Camarines Sur 17.2 ILOCOS: 20.9 23.6 23.0 26.5 26.6 Catanduanes 16.2 18.9 18.1 Abra 21.0 26.7 23.6 babate 3 18.6 18.7 14.9 atanes 11.6 9.2 10.6 oogon. 19.7 22.2 19.5 Ilocos Norto 30.4 28.2 23.6 Il.ocos Sur 25.5 24.5 25.7 -'..)T:, 17 VI;;i, : In 12.L 23. 2 Union 25.7 26.7 25.0 Bobol 16.2 19.1 21.5 Cebu 16.6 19.9 16.0 C;LGAYAN V:.IJEY: ZL& 1..ote 21.4 26.3 23.9 21.7 26.1 30.0 Saer 20.6 24.0 20.6 Isabela 23.7 26.7 33.3 it. Provincm 27.0 26.8 25.4 *.ThT.Ik- 7V3 I=s: 2L& 23.6 Nuovn Viscwry 39.1 38.6 37.3 .tique 17.2 19.5 29.8 COnt 26.1 27.6 23.5 CETR'L LUZOIT 2.LI iloilo 21.5 21.9 22.8 Pangesinn 28.2 29.7 I7egros Occidental 24.8 28.4 23.3 Nuova Ecijd 33.9 30.8 33.9 Negros Griental 21.6 27.2 23.9 Pamponga 30.6 26.7 27.7 Zomblon 13.5 23.2 21.3 Tarlac 27.0 26.1 35.0 Bulamcn 31.4 31.4 36.6 101-111' L EASTERN 12!DAN.; 23.3 27.6 Btann 34.6 34.5 39.1 gusan 19.8 36.5 24.6 Znmbolts 23.9 26.1 Bukidnan .4 30.4 17.4 31.1 34.1 26.0 28.1 36.9 80172IERIT T. OG -Isen-IsOccidental 24.-C 27.2 33.1 Behtanges 1G.4 18.5 29.0 lis-.ci Oriental 23.0 35.3 34.7 Cavite 1? .1 25.0 33.0 Surigno 20.6 22.9 27.5 Ingunn 28.2 24.0 27.9 ibrizzluque 12.6 16.9 12.7 UTiTri. & !ESTH fIlD.11-.: 2&d M0& Maindoro 1C.9 20.4 19.6 Cotzbnto 29.2 32.3 34.0 Pal-won 12.5 15.3 17.8 Dvao 19.3 28.8 28.8 Quezon (T-y-b g) 19.5 27.3 22.7 Sulu 21.4 21.8 27.0 tizal 2. .1 37.2 34.6 Labounge (Total ­ a1rte & .mur) 22.2 31.5 34.9 I ______I __ _ *__ Table III-E-V

PALAY: PERCENT OF TOTAL PRODUCTION BY REGION AND PROVINCE 1938-42; 1948-52, 1953-56

1938- 1948- 1953- 1938- 1948- 1953­ 1942 1952 1956 1942 1952 1956

Philippiner 100.0% 100.0% 100.0% Dicol 6.2% 7.4% 7.3%

Albay 1.4 1.4 1.2 Manila - - - Camarines Norte 0.4 0.5 0.4 Camarines Sur 2.8 4.0 3.9 Ilocos 5.9 6.6 3.7 Catanduanes 0.2 0.2 0.2 Masbate 0.3 0.5 0.5 Abra 0.5 0.7 0.6 Sorsogon 1.1 1.0 1.1 Batanes * -- * Ilocon Norte 2.1 2.2 1.2 Eastern Visayan 7.1 8.5 8.9 Ilocos Sur 1.6 1.4 1.0 La Union 1.6 1.4 0.9 Bohol 1.9 2.5 2.9 Cebu 0.2 0.2 0.2 Cagayan Valley 8.0 7.8 9.7 Leyte 2.7 3.4 3.3 Samar 2.3 2.3 2.5 Cagayan 2.9 2.5 2.8 Isabela 2.5 2.3 3.6 Western Visayas 14.1 15.P 14.7 Mountain Province 1.3 1.4 1.7 Nueva Vizcaya 1.3 1.6 1.6 Antique 1.4 1.2 1.0 Capiz 3.3 4.4 3.2 Central Luzon 38.0 32.4 27.8 Iloilo 5.5 5.2 5.5 Negros Occidental 3.2 4.2 3.4 Pangasinan 9.7 9.9 8.5 Negros Oriental 0.4 0.4 0.4 Nueva Eclja 13.7 9.7 8.4 Romblon 0.3 0.4 0.5 Pampanga 4.2 3.8 3.1 Tarlac 4.0 3.4 3.1 Northern an] Eastern Mindanao 5.1 5.2 7.3 Dulacan 4.5 4.1 3.4 natao n 0.8 0.8 0.5 Agusain 0.3 0.5 0.8 Zambales 1.1 0.9 0.8 Dukidnon 0.1 0.4 1.3 Lanno 2.4 2.0 2.3 Southern Tagalog 10.2 10.6 11.5 Minamia Occidental 0.6 0.6 0.7 Minamis Oriental 0.3 0.4 0.5 Batangas 1.5 2.2 2.7 Surigno 1.4 1.3 1.7 Cavite 1.6 1.8 2.0 Laguna 1.9 1.3 1.3 Southern and Wostern Mindanao 5.4 6.7 9.1 Marinduque 0.3 0.3 0.2 Mindoro 1.3 1.3 1.8 Cotabato 2.9 3.2 4.5 Palawan 0.2 0.4 0.6 Davao 0.5 0.0 1.4 Quezon (Tayabas) 1.9 2.0 1.8 Sulu 0.7 0.5 0.6 Rizal 1.4 1.4 1.3 Zamboanga (Total - Norte & Sur) 1.3 2.3 2.5

Notes: Detail may not add to totals due to rounding. * Indicates less than one-half of one percent. Corn

During the crop year 1954-1955 the harvested area of corn was 1.4 million hectares which comprised approximately 22 percent of the area planted to all crops.1/ Total production was 13.5 million cavans or 770,100 metric tons.

Almost 69 percent of the corn only moved short distances to local markets or was held on farms for consumption. Thus about 530,000 metric tons of corn generated only minor demand for transportation facilities. Most of the remaining 31 percent of corn was shipped between provinces from surplus producing provinces to deficit areas. An estimated 225,000 metric tons moved between provinces during 1955. Intraprovincial movements of corn were only minor comprising probably no more than 3 percent of the corn shipped within provinces.

Methods of Marketing Corn

Corn is grown on farms which average about 2 to 2.5 hectares.i/ Corn is harvested in the major regions between July and September and November and January. Hand methods are used almost exclusively for harvesting.

After harvesting the farmer stores the ears of corn. The corn is shelled and placed in sacks, weighing approximately 57 kilograms, then the farmer brings the corn to a local corn mill or sells the corn to palay dealers.

The movement of corn to local mills for sale in the local market or to be milled for family consumption is transported in small lots and over short distances by carabao, bus or banca.

1/ Department of Agricultural and Natural Resources, Division of Agricultural Economics. 2/ DANR, Division of Agricultural Economics, Philippine Agricultural Statistics, Vol. II, 1956, p. 76.

83 The corn which is destined for markets outside the province is sold through corn dealers. These dealers usually own trucks and collect the corn from collection points along a roat. The major primary con­ centration point such as the cono for rice does not exist to the same extent in cor:.i. Dealers are more numerous and do not mill the corn before shipments are made to final markets. Most of the large corn mills are located in corn consuming centers such as Cebu City.

The intraprovincial movement of corn is very much less than the movement of palay between urban and rural centers within a province. This can be accounted for by the differences in milling practices and the absence of a strong marketing concentration point such as the palay cono operator.

Origin and Destination of Corn, 1955

Corn, the second most important food crop of the Philippines, was produced in every province except Batanes; however, the quantity and relative importance of production by province varied widely. Table III-III sets forth the percent distributior: of corn production by province during the crop yea.. 1954-1955. Cebu was the leading producer followed by Davao, Cotabato, Isabela, Zamboanga del Sur, Negros Oriental and Cagayan.

The demand for transportation generated by the movement of corn varies in the same manner as for palay, i.e. upon the amount which is consumed and marketed directly by farmers; the quantities milled by corn mills and sold in provincial marlets and quantities of corn which are sold in markets outside the original province of production.

Corn Held and Marketed Locally by Farmers

The survey co'ducted by the Division of Agricultural Economics on the disposition of palay also included the disposition of corn. The results and explanation of th- estimate derived from this survey are set forth in Appe:dix III-F which will be found at the end of the discussion on "Corn.-" (See also Table III-F-I.) From the data on the disposition of corn it has been estimated that 69 percent of the corn grown during the crop year 1954-1955 was held and marketed locally by farmers and other users. Therefore, of the total production of 770,127

84 Table III-III

CORN: PERCENT OF TOTAL PRODUCTION BY REGION AND PROVINCE Crop Year 1954-1955

REGIONS & PROVINCES Percent Corn Production

PHILIPPINFS 100.0 ILOCOS 6h Abra .34 Batanes - Ilocos Norte .53 Ilocos Sur .66 la Union .11

CAGAYAN VALLEY 12M Cagayan 4.97 Isabela 6.35 Mbuntain.Province Nueva Vizcaya .10

CENTRAL LUZON iL82 Bataan Bulacan .27 Nueva Ecija 1.32 Pampanga .01 Pangasinan 2.09 Tarlac .16 Zambales

SOUTHERN TAGALOG Batangas 4.34 Cavite .51 Laguna .26 Marinduque .05 Mindoro Occidental .12 Mindoro Oriental .12 Palawan .05 Quezon 1.75 Rizal .10

BICOL Albay .33 Camarineo Norte .02 Camarines Sur 1.75 Catanduanes .21 Masbate 3.13 Sorsogon .31

85 Table III-III (Continued)

REGIONS & PROVINCES Percent 0Qrn Froductiop

EASTERN VISAYAS 18.9. Bohol .76 Cebu 13.71 Leyte 3.09 Samar 1.41

WESTERN VISAYIS Antique .58 Capiz .78 Iloilo 3.52 Negros Occidental. 1./1 Negros Oriental 5.i7 Romblon .73

NORTHERN & EASTERN MINDANAO Agusvn 1.58 Bukidnon 3.52 lenao 3.59 MYsamis Occidental 1.58 MLsamis Oriental 2.57 Surigao .64

SOUTHERN & WESTERN NINDANAO 2 Cotabato 7.08 Davao 7.47 Sulu .06 Zamboanga del Norto 3.44 Zamboanga del Sur 6.30

MANILA

SOURCE: DANR, Division of Agricultural. tconomics; Stanford Research Institute

86 metric tons of corn produced, approximately 531,400 metric tons generated only a minor demand for transportation facilities. This tonnage was not transported and moved only short distances in small lots usually by carabao, bus or banca.

The analysis of regional patterns indicates some significant dif­ ferences between regions. The regions are the same as those shown for palay.

The quantity of total production of corn held for the family's consumption by the farmer ranged from a low of 28.93 to a high 62.94 in the southern Tagalog provinces and western Visayas, respectively.

The percentage for the southern Tagalog provinces may be explained by the accessibility of these provinces to Manila and to the market for animal feeds in the area immediately north of Manila.

Intraprovincial Movement of Corn

The remaining 31 percent of the total corn produced during 1954-1955 comprised 238,700 metric tons. This tonnage constituted the estimated quantity which was collected and distributed through corn dealers. A similar pattern of movement to that for palay occurred with the use of trucks to collect and distribute the corn. However, the trucks are not principally those of mill operators. This stems from the fact that corn moves to market as shelled corn and is usually milled in the locale of the final market.

From the study of intraprovincial movements it has been estimated that at least 25 percent and probably as high as 30 percent of the total corn produced moves to market outside of the original producing province. If this estimate is correct, as well as the amount which is held or marketed locally, i.e. 69 percent, only a small intraprovincial movement of corn is indicated in contrast to the sizeable intraprovincial movements of palay. This seems reasonable for as explained in the discussion on methods of marketing corn, the corn mill is not the center of the marketing process as in the marketing of palay. Much more frequent use of the small corn mill is made and the small dealers represent initial collection points. Therefore, most of the demand for transportation generated by the movement of corn was based on inter­ provincial movement. Interprovincial and Interregional Movements of Corn

The analysis of the interprovincial and interregional movement of corn was based on the following data.

1. Estimates of surplus and deficit production by province pub­ lished by the DivisJ.n of Agricultural Economics.

2. Receipts of corn at the port of Cebu compiled by a special study conducted for Stanford Research Institute from a count of the number cf sacks of corn received at Cebu.

3. Estimates of receipts of corn at the port of Manila compiled by Dr. Frederick Wernstedt from a three-month sample of manifests from October 1953 to May-June 1954.

4. Interviews with personnel of the National Rice and Corn Cor­ poration, Division of Agricultural Economics, trucking firms and merchants.

The main conclusions from this study are as follows:-/

1. Most of the interprovincial movements of corn are between sur­ plus and deficit producing areas. However, the estimates of surplus and deficit corn production published by the Division of Agricultural Economics are subject to serious question for many provinces. There­ fore other data from the sources named above were relied upon exten­ sively in the analysis of interprovincial movements of corn.

2. The principal movement of corn between provinces is from Mindanao to the eastern Visayas. Davao and Cotabato supply the great bulk of these shipments which are received principally at Cebu.

3. The estimated tonnage for the shipments in 1955 from Mindanao to the eastern Visayas is 140,000 metric tons.

4. Additional shipments in the Mindanao area in 1955 include an estimated 9,000 metric tons from Bukidnon and Lanao to Misamis Oriental amd Misamis Occidental; 8,000 metric tons to Zamboanga City, principally from Cotabato and Davao; and roughly 10,000 metric tons from northern Mindanao to Negros Oriental and Negros Occidental, combined.

1/ For detailed analysis, see Appendix III-G, including Figure 111-3 and Tables III-G-I through III-G-III which will be found at the end of the discussion of corn.

88 5. Interprovincial movements of corn on the Island of Luzon are very difficult to determine. The estimates of surplus and deficit corn production published by the Division of Agricultural Economics are either understated as to the deficit or overstated as to surplus by a significant margin. Indications are the deficit is understated because of low estimates of corn for animal feeds.

6. The two leading corn surplus producing areas were Cagayan and Isabela provinces in the north and Batangas province in the south. It has been estimated at best 30,000 to 40,000 metric tons of corn were shipped from these two surplus producing areas to other provinces on Luzon.

7. In 1955 Manila was a net importer of corn. A total tonnage of 17,000 metric tons has been estimated for interprovincial shipments of corn into and out of Manila.

8. In summary, in 1955 between 53,000 and 57,000 metric tons of corn were shipped between provinces on Luzon and adjacent islands, in­ cluding shipments into and out of Manila. An estimated 170,000 metric tons were shipped in the Mindanao-Visayan area; thus total inter­ provincial movements of corn have been estimated to range between 222,000 and 227,000 metric tons during 1955.

Future Developments in Corn

Anticipated Changes in Total Production of Corn, 1957-1967

As shown on Table III-IV, total production of corn has been pro­ jected for the years 1961 and 1966 on the basis of estimated per capita requirements. Total production for 1961 has been estimated at 880,000 metric tons and for 1966 at 940,000 metric tons.

The per capita requirements for 1956 were a departure from past trends and represent the results of a very favorable year in corn production. Therefore, 36.00 kilograms was assumed for 1961. By 1966 it has been estimated that per capita requirements will decline to

89 Table III-IV

DOMESTIC CORN REQUIREMENTS, PHILIPPINES. 1940-1966

/ a/ 2 Por Capita Year Population Total Production Consumption Cavans Fbtric Tons Kilograms 1940 16,459,900 10,038,340 572,185 34.76 1948 1%143,800 9,105,470 519,012 27.11 1951 20,259,500 10,582,?20 603,186 29,77 1952 20,645,600 13,336,200 761,873 36.90 1953 21,039,200 12,447)0)0 709,513 33.72 1954 21,440,200 13,700,f00 7M0,900 36.42 1955 21,848,800 13,511,000 770,127 35.25 1956./ 22,265,300 14,898,390 4 849,205 38.14 1961a. 24,469,700 15,400,000 860,000 36.00 1966 / 26,892,300 16,500,000 940,000 35.00

SOURCES: I/ Bureau of Census and Statistics

2/ DANR,Division of Agricultural. Economics, Philippine Agricultural Statistic, Vol. I, 1954, p.35

3/ DANR, Division of Agricultur-1 Economics, Selected Statistics on Rico and Weather Conditions, December, 1955

/ DANR, Division of Agricultural Economics Preliminary Estimate

5/ Stanfurd Research Institute.

90 35.00 kilograms per person. The estimate is based on the reasoning that increased National Income will cause the marginal consumption of corn to decline. As explained in the analysis of future developments of palay production, increased income will also tend to induce sub­ stitution of riceforother food crops. Therefore, on balance human consumption of corn should decline to some extent. The decline in per capita requirements for human consumption will be offset to a large extent by increased use of corn for animal feeds. Thus, per capita requirements have been projected at approximately the same level.

Anticipated Changes in Regional Patterns of Corn Production, 1957-1966

Tables III-H-I through III-H-V (in Appendix III-H), summarize the changes in the 9 corn regions, delineated in the section on palay and rice between the period 1938-1942 and 1953-1956. Total production of corn, percent of total production of the Philippines, area planted, percent of area planted and yield per hectare are set forth for the period. As in the case of palay detailed analyses of each province are required before final assessment of future developments can be made; however, some basic trends in regional patterns can be derived from these tables.

Anticipated Changes in Surplus and Deficit Areas of the Visayas

The provinces of Cebu, Samar, Negros Occidental, Negros Oriental and Romblon increased production at a faster rate than the total Philippines, while Leyte, Bohol, Antique and Capiz experienced declines in production. These changes resulted in the percentage of total production in the eastern Visayas declining from 29.8 to 23.8 and in the western Visayas increasing from 14.8 to 16.7 percent. The increases in production were a result of both greater hectarage and gains in yield per hectare.

On the basis of these trends it is clear that the Visayas will remain the deficit area for corn of the Philippines.

Anticipated Changes in Corn Production in Mindanao

Davao, Cotabato, Zamboanga and Bukidnon experienced substantial increases in production while the deficit areas declined in production. Therefore, it has been estimated that the same distribution pattern for corn in Mindanao will remain over the next decade.

91 In addition, Cotabato and Davao should continue to supply the great bulk of corn to meet the deficit of the Visayas.

Anticipated Changes in Luzon and Adjacent Islands

Because of the basic question raised concerning the origin and destination of corn on the island it is difficult to anticipate the changes which will occur. However, it seems likely that Cagayan Valley and Batangas will be the major corn producers. Even if the demand for corn for animal feed rises substantially, the basic pattern should still remain.

Transportation Needs and Improvements in the Movement of Corn

The principal transportation needs which can be related to the movement of corn are those for port improvements at Dadiangas and Cotabato, Cotabato. In addition the heavy shipments of corn out of the Port of Davao could be related to the need for improved port facilities.

A secondary problem is the need for better roads in the collection of corn, but this is not as significant as in the case of palay, because of the tonnages involved. Road improvements in Davao and Mindanao should be based to some extent on the potential benefits to corn producers.

92 Appendix III-F Appendix III-F

Explanation of the Estimate of Corn Held or Marketed Locally by Farmers

The estimate of 69 percent of the corn held or marketed locally by farmers was derived as follows:

a. On Table III-F-I the quantity of corn consumed by family (Column 10) is shown as 46.88 percent. No portion oi this amount was sold.

b. The residual is the amount of palay left over after subtracting Columns 1-11 from total production. It has been estimated that 50 percent of the residual was sold to corn dealers.

c. Part of the disposition of corn for the uses and the payments indicated inColumns 1-9 and Column 11 were also held by the farmer and consumed or marketed locally by the persons receiving the corn in payment from the farmer.

d. It was estimated that all of the waste can be attributed to the operations of the farm. This quantity was not transported.

e. Seventy-five percent of the seed, animal feeds, payments for harvesting, husking and shelling, and hauling were held by the farmer or consumed or marketed locally by the person receiving corn from the farmer.

f. The payments for rent, repayment of loans, etc., were estimated by checking the total percentages against the amount which moved between provinces. Since it is estimated about 29 percent of corn is shipped between provinces, the amount held by the persons receiving corn as rent payments, etc., was estimated at only 10 percent of the payments. If this estimate were raised it would indicate that practically no intraprovincial movements of corn took place.

PREVIOUS PAGE BNK

r%e Table III-F-I

PERCENT DISPOSITION OF SHELLED CORN BY REGION AND PROVINCE

(2) (1) (1,,(2 ()) ESID UAL

A0 P NTota Fnm & of to of loans to Sold to Consued vest- Bucking icanz Shellin0 iuling 'ant lar=lord Others Others by Family ate

PLIPIHES100.00 6.45 4.26 0.99 0.9 12.47.79 C..E C.65 13.24 46.,8 0.99 14.28 100.00 4.15 20.51 1.6' 0.64 0.11 11.9L 0.; 0.01 3.67 51.07 0.93 5.22 CLAUMVlLE 100.00 1.99 12.01 2.9 0.59 0.67 10.29 0.54 1.08 15.1C 30.39 1.22 15.22 E1RAL MW 100.00 2.23 7.79 2.76 1.47 1.04 32.1.2 1.11 1.c1 11.72 48.82 0.74 8.88 SOfTfE TAGALOG 100.00 2. CL 11.55 2.2, 0.27 C.47 9.34 0.57 2.65 17.01 28.93 0.74 23.45 BICOL 100.00 2.59 7.27 2.76 0.36 0.56 1.94 C.Cr 2.11 11.33 50.6C 0.27 20.08 EAS=E VISI,!:. 100.00 T.E 3.1.5 5.24 0.55 1.08 10.74 0.32 0..2 7.d9 52.97 0.85 13.65 W=E' VISIYS 100.00 3.45 4.E9 3.C6 1.14 0.86 6.4E 0.45 0.42 3.14 62.94 1.32 10.74 NOEEEN & 8STERU MNDA0 100.00 1.5L 3.62 6.43 1.59 1.21 4.60 0.75 0.51 23.30 41.14 1.23 14.06 SOUTEE3 & WFTE MINDAUO 100.00 1.07 6.33 4.07 1.80 1.06 3.76 0.52 1.14 23.87 39.10 0.95 15.52 The following tabulation summarizes the derivation of the estimate of 69 percent.

Held or Sold to Marketed Locally Corn Dealer

Consumed by family 46.88 Residual 7.14 7.14 Waste 0.99 Seed 1.84 .62 Animal Feeds 4.84 1.61' Harvesting 3.20 1.06 Husking and Shelling 0.99 Hauling .70 .23 Rent ) Repayment of Loans to Landlord ) 2042 20.34 Repayment of Loans to Other ) Sold to Others ) 69.00 31.00

Source: Stanford Research Institute Appendix III-G

PREVIOUS PAGE BLANK Appendix III-G

Detailed Analysis of Interprovincial and Interregional Movements of Corn

Interprovincial and Interregional Movements of Corn

The analysis of the interprovincial and interregional movement of corn was based on the following data:

1. Estimates of surplus and deficit production by province pub­ lished by the Division of Agricultural Economics.

2. Receipts of corn at the Port of Cebu compiled by a special study conducted for Stanford Research Institute from a count of the number of sacks of corn received at Cebu.

3. Estimates of receipts of corn at the Port of Manila compiled by Dr. Frederick Wernstedt from a three month sample of manifests from October 1953 to May-June 1954.

4. Interviews with personnel of the National Rice and Corn Corporation, Division of Agricultural Economics, trucking firms, and merchants.

Estimates of Interprovincial and Interregional Movements of Corn

The net surplus and deficit production of corn for each province have been set forth on Table III-G-I and are shown graphically on Fig­ ure 111-3. These estimates give a gross indication of the interprovincial movement of corn in respect to the major deficit areas and most of the principal producing areas. The eastern Visayas, Negros Occidental and Negros Oriental overwhelmingly comprised the corn deficit area of the Philippines. The major surplus areas which supplied this deficit were provinces located in Mindanao.

101 Q -Legend­ (metric tons)

Surplus: Deficit:

- 50,000 50,000

-20,000 20,000 0 00 0 : 10,000 1 , 00,

0v

FIG. 111-3 NET SURPLUS AND DEFICIT CORN PRODUCTION 1955

102 Table III-G-I

CORN: SURPLUS AND DEFICIT PRODUCTION BY REGION AND PROVINCE, CROP YEAR 1954-1955

Thousands of Metric Tons Thousands of Cavans Gross Gross Net Priducti on Consumption Net 3urplus Consumption Surplus or Column Requirements or ( )ef icit) Region and Province Productio n Requirements (Deficit) 1 x .05 7 Col. 2 x .057 Col. 3 x .057

Philippines 13,511 13,466.5 44 770 767.5 2.5 Manila 13 (13) .7 (.7) Ilocos 223 202 21 13 11.5 1 Abra 46 63 (17) 3 4 (.9) Batanes 1 (1) .08 (.08) Ilocos Norte 72 47 25 4 3 1 02 Ilocos Sur 89 47 42 5 3 2 La Union 15.5 43 (27) .8 2 (1.5) Cagayan Valley 1,581 915 666 90 52 38 Cagayan 671 433 237 38 25 13.5 Isabela 858 411 447 49 23 25 Mountain Province 39 52 (13) 2 3 (.7) Nueva Vizcaya 13 18 (5) .7 1 (.2) Central Luzon 534 485 48.5 30 28 3 Bataan .4 7 (6) .02 .3 (.3) Bulacan 36 35 1 2 2 .05 Nueva Ecija 178 134 44 10 8 2 Pampanga 12 44 (32) .7 2.5 (2) Pangasinan 282 216 66 16 12 4 Tarlac 24 35.5 (11) 1. 2 (.6) Zambales .5 13 (12) .03 .7 (.6) Table III-G-I (Continued)

CORN: SURPLUS AND DEFICIT PRODUCTION BY REGION AND PROVINCE, CROP YEAR 1954-1955

Thousands of Metric Tons Thousands of Cavans Gross Gross Net Producti on Consumption Ne t Surplus Consumption Surplus or Columr Requirements or (Deficit) Region and Province Productic n Requirements (Deficit) 1 x .057 Col. 2 x .057 Col .3 x .057

Southern Tagalog 982 453 529 56 26 30 Batangas 586 201 385 33 11 22 Cavite 69 28.5 41 4 2 2 Laguna 35 61 (26) 2 3 (1) Marinduque 6 10 (4) .3 .5 (.2) Mindoro Occidental 16 10 6 .9 .5 .3 '-a 0 Mindoro Oriental 17 17 .4 .9 .9 .02 3t~. Palawan 4 13 (9) .2 .7 (.5) Quezon 236 79 157 13 4 9 Rizal 13 33.5 (21) .7 2 (1) Bicol 774 522 252 44 30 l4

Albay 44 68 (24) 2.5 4 (1) Camarines Norte 3 11 (8) .1 .6 (.4) Camarines Sur 236 76 160 13 4. 9 Catanduanes 29 26 3 2 1 .1 Masbate 422.5 295 127 24 17 7 Sorsogon 40 45 (5.5) 2 2.5 (.3) Eastern Visayas 2,567 5,157 (2,590) 146 293.5 (148) Bohol 106 726 (620) 6 41 (35) Cebu 1,853 .302 (1,170) 106 17 (67) Leyte 418 1,025 (607) 24 58 (35) Samar 190 383 (193) 11 22 (11) Table III-G-I (Continued)

CORN: SURPLUS AND DEFICIT PRODUCTION BY REGION AND PROVINCE, CROP YEAR 1954-1955

Thousands of Metric Tons Thousands of Cavans Gross Gross Net Production Consumption Net Surplus Consumption Surplus or Column Requirements or (Deficit) Region and Province Production Requirements (Deficit) 1 x .057 Col. 2 x .057 Col. 3 x .057

Western Visayas 1,742 2,480.5 (738) 99 141 (42) Antique 79 82 4 (3) 5 (.1) Capiz 105 131 (26) 6 7 (1) Iloilo 475 349 126 27 20 7 Negros Occidental 190 973 (783) 11 55 (44) Negros Oriental 794 906 (112) 46 52 (6) Romblon oA 99 40 59 6 2 3 Northern and Eastern Mindanao 1,818 1,523 295 104 87 17 Agusan 214 186 27.5 12 11 1.5 Bukidnon 475 232 243 27 13 14 Lanao 485 253 232 28 14 13 Misamis Occidental 214 308 (93.5) 12 17.5 (5) Misamis Oriental 343 413 (70) 19.5 23.5 (4) Surigao 87 131 (44) 5 7 (2.5) Southern and Western Mindanao 3,290 1,716 1,574 187.5 98 90 Cotabato 956 667 289 54.5 38 16 Davao 1,009.5 363 647 57.5 21 37 Sulu 8.5 97 (89) .4 5.5 (5) Zamboanga del Norte 464.5 293 171 26 17 10 Zamboanga del Sur 851.5 296 555 48.5 17 32

Source: DANR, Division of Agricultural Economics. Table III-0-II

SHIPMENTS OF CORN TO CEBU BY PROVINCE AND PORT 1955

Region, Province ard Port Metric Tons

Visayas

Bohol 215 Tagbilaran 215 Leyte 4,168 Orioc 958 Calubian 455 Palompon 451 Baybay 58 Tacloban 3.,868 Maasin 79 Others 299 Sarar 245 Guiuan 154 Calbayog 78 Others 13 Negros Oriental 32 Dumaguete Others 165 Iloilo 251 Iloilo 251 Capiz 2l

Luzon 10,91 Manila 86 Albay 2 6 Legaspi 2-04 Masbate 81 Masbate 407 Cataingan 410 Sorsogon 168

Mindanao 138,139

Cotabato 39,525 Cotabato 19,816 Dadiangas 17,165 Lebak 1,901 Glan 68 Parang 376 Others 199

106 Table III-G-II (Continued)

Region, Province & Port Metric Tons

Mindanao

Davao 90,845 Davao 85,558 Sta. Cruz 1,787 Mialalag 2,439 Others 1,61 Agusan 145 Lanao 8 Iligan 2 Tubod 963 Margas 176 Misamis Oriental 1 046o Cagayan 1,460 IMisamis Occidental 42$ Ozamis 317 Oroquieta 82 Others 29 Surigao I Surigao 3 Sulu 80 Jolo 80 Zamboanya del Norte 920 Dipolo g 143 Sind angan 680 Salug 85 Others 12 Zamboanga del Sur 8 6 Pagadian 68 Zamboanga City 218

T o t a 1 154,331

Source: Special Study Conducted For Stanford Research Institute

107 Beyond this gross indication of movement, however, these data must be qualified and supplemented with other data. The following analysis has combined the data shown on Table III-G-II and III-G-III with the estimates of surplus and deficit production to derive the pattern of 1 interprovincial corn movements. / -

Interprovincial Movements of Corn from Mindanao to the Visayas

The total combined deficit of Cebu, Bohol, Samar, Leyte, Negros Occidental and Negros Oriental was estimated at 198,800 metric tons (See Table III-G-I). The surplus producing provinces of the Visayas-- Iloilo and Romblon supplied only a fraction of this deficit. Even the estimate of 9,000 metric tons appears too high. The great bulk originated in the provinces of Davao and Cotabato. As shown on Table III-G-II, Davao shipped a total of 90,845 metric tons to Cebu in 1955, while ports in Cotabato sent 39,525 metric tons. The total estimated shipments into Cebu were 154,331 metric tons. These two provinces supplied 84 percent of the total receipts of corn at Cebu.

a. The surplus corn production of Davao and Cotabato are under­ stated by a considerable degree. There does not appear to be any probability that these two provinces received large shipments from other provincer for transshipment to Cebu.

b. This conclusion, in conjunction with the quantity of shipments for Cebu from Lanao and Cagayan de Oro, also indicates that the surplus of Zamboanga del Sur and Zamboanga del Norte are overstated in the Division of Agricultural Economics estimates by a wide margin. It is possible that Negros Occidental and Negros Oriental were supplied by corn originating in the Pagadian area of Zamboanga del Sur and the northern part of Zamboanga del Norte. However, if such were the case, it is likely that Iloilo would have received a sizeable tonnage of these shipments to be transshipped to Negros Occidental. The data supplied by Dr. Wernstedt do not substantiate this hypothesis.

1/ The data compiled by Dr. Wernstedt have also been used in deriving the pattern of interprovincial movements of corn. c. It is possible that direct shipments were made from Zamboanga provinces to Bohol and Leyte. Since no data are available on receipts at ports such as Tagbilaran, Bohol or Ormoc, Leyte, this hypothesis cannot be tested directly. However, if such were the case the quantity of shipments received at Cebu would indicate that the deficit of the Visayas was much greater than indicated on Table III-G-I. It is more likely, therefore, that the shipments to Cebu were to a larger extent transshipped to other provinces. This is partially substantiated by the data on receipts at Tacloban compiled by Dr. Wernstedt.

d. Lanao and Bukidnon were secondary surplus producing provinces of Mindanao. Table III-G-I shows a surplus of 28,000 metric tons for these two provinces; 9,000 netric tons of which could have been shipped to Misamis Oriental and Misamis Occidental to meet the deficit require­ ments of these provinces. This would mean that 19,000 metric tons were shipped to Visayas. The data on Table III-G-II indicate that this estimate is overstated.

e. In respect to the substantial deficit of Negros Occidental, from the data available no indication of large shipments from Mindanao or Luzon are indicated. From the survey of Negros Occidental and inter­ views with the Provincial Agriculturist, it can be concluded that this estimate is overstated.

f. About 8,000 metric tons of corn were shipped to Zamboanga City according to the data compiled by Dr. Wernstedt. Seventy-five percent of these shipments originated on Cotabato and Davao. There­ fore, the above conclusions derived appear to be further substantiated.

In summary the following movements of corn in the Visayas and Mindanao area can be set forth:

1. 140,000 metric tons from Mindanao to the eastern Visayas; principally Cebu.

2. 9,000 metric tons from Bukidnon, and Lanao to Misamis Oriental and Misamis Occidental.

3. 8,000 metric tons to Zamboanga City principally from Cotabato and Davao.

4. Perhaps as much as 10,000 metric tons to Negros Occidental and Negros Oriental combined from northern Mindanao.

109 5. Therefore, total tonnage moved in this area was about 170,000 metric tons.

Interprovincial Movements of Corn on the Island of Luzon and Adjacent Islands

According to the data set forth on Table III-G-I, the Island of Luzon and adjacent islands is a net surplus producing area of approxi­ mately 85,000 metric tons of corn. If this were the case a net movement from Manila or other ports of Luzon would be required. From the data on receipts of corn at Manila (See Table III-G-III) and receipts at Cebu, Iloilo, Tacloban, Zamboanga City, Cagayan de Oro, Davao, Legaspi, and Tabaco compiled by Dr. Wernstedt, it is clearly established that Manila is a net importer of corn rather than a net exporter of corn. No other ports on Luzon are indicated as shipping any sizeable tonnages to the Visayas. Therefore, either the estimates of deficit corn production on Luzon are understated or the surplus production is overstated by a significant margin.

Indications are that the deficit is understated because of the low estimate of corn used for animal feeds. No data were available on the volume of corn being utilized as chicken and hog feed particularly in Bulacan and Batangas./ A survey of this area would afford more reliable data.

Assuming that corn was used for animal feeds and that the surplus estimates are correct, a total tonnage movement from Cagayan and Isabela provinces of about 38,000 metric tons is indicated and shipments of about 22,000 metric tons from Batangas should have occurred. Except for about 3,925 metric tons of corn from Aparri very little corn from Cagayan Valley is distributed in Manila according to findings from interviews with trucking firms and merchants. Therefore, the shipments of corn from Cagayan would have to be destined for markets in the central Luzon provinces. No further data were available to establish the extent and destination of these shipments.

1/ The fact that animal feeds might have been understated should not alter the estimates derived in Appendix III-F.

110 1 Table 111-0-III

SHIPMENTS OF CORN TO MANILA BY REGION AND PROVINCE 1955

Region & Province Metric Tons

Luzon Cagayan Valley Cagayan P" ITa Southarn Tagalog ICATIONS f1DAASIOX Hindoro Orie3ntal A Palawani ID/MANIA6 Bicol Region Albay 171 Sorsogon 91 Masbate 496

Visayas

Western Visayas 1.040 Capiz 113 Iloilo 827 Negros Occidental 62 Negros Oriental 23 Romblon 15 Eastern Visayas 5.901 Cebu 5,843 Leyte 57 Samar 1

Mindanao

Northern & Eastern Mindanao Agusan :1 Misamis Occidental 405 Misamis Oriental 2,363 Lanao 546 Southern &Western Mindanao 6,088 Cotabato 4,387 Davao 1,543 Sulu 125 Zamboanga del Sur 33 T o ta 1 23,117

Source: Data Compiled-by Dr. Frederick Wernstedt, 1956; Stanford Research Institute.

111 Corn was shipped from Batangas to Bulacan; however, according to the Division of Agricultural Economics, most of the surplus of Batangas corn was used for animal feeds within the province itself.

Therefore, it seems reasonable to conclude that at best between 30,000 and 40,000 metric tons of shipments of corn were made from the two leading surplus producing provinces of Luzon combined to other provinces within the Luzon area.

Other surplus estimates were not considered reliable enough to include as a part of interprovincial movements of corn. Thus, for example, the surplus of Pangasinan, Pampanga, Quezon, Masbate, and Camarines Sur have probably been accounted for in the total movement estimated.

As shown on Table III-G-III the total tonnage of inbound shipments to Manila was approximately 23,000 metric tons. Table III-G-II, shows 7,506 metric tons to Cebu and probably another 3,000 metric tons to other ports, although Dr. Wernstedt's data indicate much less tonnage to these other ports. Assuming that 50 percent of these shipments have already been counted in other movements, a total tonnage of inter­ provincial shipments into and out of Manila of about 17,000 metric tons has been estimated.

In conclusion it has been estimated that a tonnage of between 53,000 and 57,000 metric tons was shipped between provinces on Luzon and adjacent islands including shipments into and out of Manila during 1955. Added to the estimated 170,000 metric tons in the Visayan-Mindanao area total shipments of corn between provinces range between 222,000 and 227,000 metric tons during 1955. The estimate comprises between 28 and 30 percent of the total corn produced during 1955. Appendix III-Hl

Anticipated Changes in Regional Patterns of Corn Production, 1957-1966 Table III-H-I

CORN: PRODUCTION OF CORN BY REGION AND PROVINCE - PHILIPPINES - 1938-1956 (Cavans)

1938-42 1948-52 1953-50 Percent Increase Percent Increase Region and Province Average Average 1953 1954 1955 1956 Average 1938-42 to 1048-52 1938-42 to 1953-56 Philippines 9,421,740 10.497,798 12,447,000 13,700.000 13,511,000 14,898,340 13.639.085 11.4 44.8 Manila

IInco 221.440 184.620 222,300 132.850 160,800 157,070 168,480 19.9 (Decrease) 31.4 (Decrease) Abra 65,240 66,308 138.000 38,320 37,700 44,280 64,075 1.6 1.8 (Decrease) Batanes 1.560 105 1,000 1,370 1,240 1,530 1,285 1.385.7 (Decrease) 21.4 (Decrease) Iloco. Norte 63.630 46.028 22,8r,- 24.660 51.240 53,140 37.960 33.2 (Decrease) 67.6 (Decrease) Ilocos Sur 66,280 42.032 50,,1 58,170 60,200 49,010 54,245 5S.5 (Decrease) 22.2 (Docrease) La Union 24,730 28,812 1180f, 12,330 10,420 0m110 10.915 16.5 126.0 (Decrease) Cagayan Valley 1,023.3'0 1,129.534 1.67,900 1.835,600 1,670,000 1,317.460 1,624,540 10.4 58.8 Cagayan 496.270 457,62e 457,200 505,530 410,000 329,900 427,007 8.4 (Decrease) 16.0 (Decreaae) Iabela 497,000 632,002 1,177,200 1,296,020 1,109.000 028,110 1,147.582 27.3 130,0 Mountain Province 9,080 21,072 23,000 24,660 47.000 37,800 33,115 132.1 204.7 Nueva Vizcaya 20,060 17,936 8,500 9,500 24,000 21.650 15,015 16,9 (Decrease) 31.5 (Decrease) Central Luzon 500.480 438.948 420,700 403,060 490,000 011.430 490,290 14.0 (Decrease) 0.0 (Oereas) Pangaminan 256,450 24.076 257,100 283,500 271,610 329,340 284,990 2.7 (Decrease) 11.0 Nueva Ecija 166,730 126,982 101.500 110,970 115,690 192,900 130,265 31.3 (Decrease) 28.0 (Decrease) Pampanga 27.580 14.876 26,600 29,770 15,010 21,050 22.90R 85.4 (Decrease) 20.4 (Decrease) Tarlac 14,810 7.752 12,000 13,700 29,720 33,030 22,337 110 (Decrease) 11.1 Bulacan 30,400 31.446 17.100 19,190 36,000 25,800 24,520 3.4 21.0 (Decrease) Dataan 3,090 3,482 3.000 2,740 16,290 6,300 7,582 12.7 145.4 7aabales 1.420 4,734 3,200 4.110 3,680 5.110 4,025 233.4 183.4 Southern Tagalog 245.340 448,288 1,195.200 962,700 823,000 788.610 042.390 82.7 284.1 Batangas 149,300 304.330 695,500 795.830 Cavite 525,500 498,800 921,407 103.8 316.2 17,100 20.552 42,900 47,950 53.730 54,500 49,770 Laguna 72.8 191.1 17,870 31.160 319,300 32,470 34,870 34,780 Marinduque 112,855 11.2 531.5 4,500 5,064 5,000 5.4800 0.220 Mindoro 9,680 7.345 12.5 63.2 17,880 17.90 20,200 21,920 34,300 32,350 27,215 Palawan 0.5 52.2 5,750 20,894 42,800 0.580 7,080 7,090 Quezon 15,885 367.7 578.3 20,320 20,730 20.400 74,020 150 .4 143.740 Rizal 80 97,385 2,0 379.3 12.620 9,590 10,100 7,550 7,730 7,730 10,527 31.8 (Decrease) 19.9 (Decree) Ricol 214.750 336.898 459,100 501.530 042,000 777.390 590,005 19.9 177.5 Albay 23.180 32.980 23.000 26,030 62.320 79,200 Canartnes Norte 47,807 42.3 106.2 4,130 9,920 1,600 1,370 5.460 6,800 3,807 Camarines Sur 97.6 8.5 (Decrease) 24.180 *IR,10 114.100 120,040 184,120 220,000 Catanduanes 162,580 90.3 e72.4 17,000 29,980 10,000 20,550 17,840 Masbate 20,050 19,390 79.5 13.9 120,800 210.192 288900 317,810 Sorsogon 316,160 400,800 340.025 91.9 162.7 16.460 8,620 11.900 13,700 16,100 44.400 21,521 81.0(Decrease) 30.8 eastern Viasyss 2,812,600 2,767.180 2,645,800 2,012.620 3,402.100 4,017,030 3,244.387 1.6 (Decrease) 15.4 Bohol 304,600 218,400 110,300 121.930 225,250 273,020 182,8F150 17,9 (Decrease) 69.6 (Decrease) Cebu 1,347,970 1,51,200 1,09,8200 2,198,810 2,013,000 2,301,600 2,147,912 11.1 L.eyte 1,101.960 19.3 003,170 379,900 417,810 1,030,130 1,204l,t00 719,121 Samar 22,0 (Decrease) 45.4 (Decrease) 57,.080 54,720 157,400 173.090 133.700 156910 111,500 6.0 (Oecreiane)198.2 Western Visayse 1,306,150 1.829,480 2,230,500 2,464,630 1,95,900 2.395.030 2,273,600 30,8 92.9 Antique 53.750 11609 22.800 24,660 11,290 20,620 29.12 4.2 (Decrease) 80,1 (Decreas) Caple 63.060 167,120 41,400 41,210 70,010 79,190 58,710 191.0 8,4 (Dcrease) Iloilo 220,330 317,174 410,900 491,670 345,430 770900 500.002 62,1 127,4 Nqgros Occidental 480,690 621,144 R73,200 091.740 630,200 714,4,0 704.890 29.9 62.3 Negros Oriental 558,00 608,850 849,000 934,340 830,170 794,100 944,102 9.1 Romblon obln11,210 20,194 33,200 5. 30900 69.470 40,350 44,712 82.9 207.8 Northern and Eastern Mindanao 1,947,840 1.495,014 99.100 1.5a3,620 1,720,000 1.806,720 1,522.360 11.0 (Dec:cano) 8.2 (Docreae) Aguman 121.,3i0 97,770 99,00 101,400 155,630 231,200 148,090 7, Dcen) 2. Bukidnonfuion167,450 200,186 115,501) 7. Dces) 2. 127.41n 217.600n 2012,310 188.227 71.1 1. Lao4510 3,40 10,000 482,600 280,21 203.180O 270,602 17,9 (Decrease) 60,8 (Decrease) Misamis Occidental Nlaa'iieOriental 109,940 452.259 414,400 500.010 476.500 500.090 485,010 12.5 (Decrease) 4.9 (Dcrease) 348,000 254,938 2098,00 230.160 40,950 314,700 Surigoo 315.902 39.5 (Deease) 10.3 (Decrease) 6.020 54,324 107.500 117,820 110,00 121,940 114.537 23.2 (Decrease) 71.2

Southorn and 7estern Mindanao 1,359.070 1,910,469 2,5D7,400 2,850,100 2,598,500 3,029,610 2,770,435 38,3 103.7 Cotabato 620,860 663,802 98.800 09140 904,O 912,490 029,265 39,1 Davan 245,390 368,260 835.600 020.040 872,990 1,187,450 054,492 50.1 48.2 Sulu 79,600 83,202 81,000 800 43,410 49.640 65.125 4.5 289.0 21.5 Zeaboasgs Del Norte 359,5001 391,0301 265,830 305,1001 332,0 - (Decrease) Enha-nge Del Surt2. 152 422,300j 464.430J 500,640J 573,000 491,592) Zaboanga Provinces Tola1 413,920 565,112 781,800 860,360 776,470 878,100 824.183 38.5 99.1

"7EE Table III-H-II

CORN: PERCENT OF TOTAL PRODUCTION BY REGION AND PROVINCE 1938-42; 1948-52; 1953-56

1938- 1948- 1953­ 1938- 1048- 1953­ 1942 1952 1956 1942 1952 1956

Philippines 100.0% 100.0% 100.0% Stcol 2.3% 3.2% 4.4%

Nantia­ - Albay 0.2 0.3 0.4 Cuaarines Norte * Iloco. 2.4 1.8 1.2 Camarines Sur 0.3 0.5 1.2 Catanduanee 0.2 0.3 0.1 Abra 0.7 0.6 0.5 Masbate 1.4 2.0 2.5 Bsatanes *. * Sorsogon 0.2 0.2. Ilocos Norte 0.7 0.4 0.3 Ilocos our 0.7 0.4 0.4 Eastern Visyas 29.8 26.4 23.8 La Union 0.3 0.3 * Bohol 3.2 2.5 1.3 Cagayan Valley 10.9 10.7 11.9 Cebu 14.3 14.8 15.7 Leyte 11.7 8.6 5.6 Cagayan 5.3 4.3 3.1 omar 0.6 0.5 1.2 Isabela 5.3 6.0 8.4 Mountain Province 0.1 0.2 0.2 Western Visayan 14.8 17.4 16.7 Nueva Vizecay 0.2 0.3 0,1 Antique 0.6 0.5 0.3 Central Luzon 5.2 4.2 3.6 Capin 0.7 1.6 0.4 Iloilo 2.3 3.4 3.7 Pangapinan 2.7 2.4 2.1 Negros Occidental 5.2 5.9 5.8 Nueva Ecija 1.8 1.2 0.9 Negros Oriental 5.9 5.8 8.2 Paspanga 0.3 0.1 0.2 Romblon 0.1 0.2 0.3 Tarlac 0.1 0.2 Bulacan 0.3 0.3 0.2 Northern and Eastern Mindanao 17.5 14.1 11.2 Bataan * 0.1 Zambales * Agunan 1.3 0.6 1.1 Dukidnon 1.8 2.7 1.4 Southern Tagalog 2.7 4.3 0.9 Lanno 4.6 3.5 2.0 Misamis Occidental 5.4 4.3 3.0 Datangas 1.6 2.9 4.6 Misamis Oriental 3.7 2.5 2.3 Cavite 0.2 0.3 0.4 Surigano 0.7 0.5 0.8 Laguna 0.2 0.3 0.8 Marinduque 0.1 0.1 0.1 Southern and Western Mindanau 14.4 17.9 20.3 Mindoro 0.2 0.2 0.3 Palawan 0.1 0.3 0.1 Cotabato 6.6 8.2 g.I Quezon 0.2 0.2 0.7 Davao 2.6 3.5 7.0 Rizal 0.1 * 0.1 Sulu 0.8 0.8 0.5 Zamboanga (Total - Norte & Sur) 4.4 5.4 6.0

Notes: Detail may not add to total due to rounding. * Indicates less than one-half of one percent.

116 Table III-H-III

CORN: AREA PLANTED BY REGION AND PROVINCE - PHILIPPINES - 1938-1956 (Hectares)

Percent Increase Percent Increase 1038-42 1948-52 1953-56 1938-42 to 1938-42 to Region and Province Average Average 1953 1954 1955 1056 Average 1948-52 1953-50

'hilippines 911140 019,766 1,101,250 1180,000 1,393,72 1,434,430 1,277350 0.9 40.2

Manila

Ilocos 2SL0 19,576 1 40 16800 10 0 18,0 182 .4 (Decrease) 14.2 (Decrease) Abra 5,800 0,504 8,500 2,860 3,500 3,090 4,637 11.0 11.0 (Decrease) Datanes 150 103 140 - 140 140 105 45.0 (Decrenee) 42.9 (Decrease) Ilocos Norto 5,620 5,582 2,560 5,710 7,100 7,360 5,688 0.7 (Decrease) 1.2 Ilocos Sur 6,470 4,704 4,800 7,220 7,410 6,200 6,430 37.5 (Decrease) 0.6 (Decrease) La Union 2,340 2,704 1,150 1,010 1,050 020 1,032 15.0 126 7,(Decrease)

Cagayan Valley 67,780 87,270 25,340 2 110,10 88.30 104,197 1"j.8 53.7 Cagayan 35,660 35,262 34,750 26,00 20,070 22,910 28,422 1.1 (Decraneo) 25.5 (Decrease) Isabela 29, 47,862 80,520 58,500 71,680 55,010 68,168 62.1 130.9 Mountain Province 8b. 1,030 2,310 5,580 0,780 6,040 5,402 119.3 513.9 Nueva Vizcays 1,720 2,210 1,760 1,1160 2,570 2,830 2,205 28.8 28.2

Central Lazon 47,45 43552 42,700 4 59900 62730 53,652 0.0 (Decrease) 13.1 Pangasinan 20,680 22,872 26,220 24,150 30,170 31,080 27,003 10.6 34.0 Nueva Ecija 18,150 13,172 8,130 14,290 18,370 19,290 15,020 37.8 (Derease) 20.8 (Decrease) Paspanga 3,350 1,808 2,800 1,480 1,700 1,910 1,095 85.3 (Decrease) 67.9 (Decrease) Tarlac 1,660 1,066 1,880 3,940 3,370 3,60 3,202 55.7 (Decrease) 00.5 Dulacan 3,110 3,340 2,610 3,450 4,200 4,300 3,040 7.4 17.0 Sataan 350 286 040 1,480 1,500 1,560 1,205 22.8 (Dncrease) 270.0 Zambales 150 46B 330 490 500 730 535 212.0 2560.7

Southern Tagalog 33,020 42,654 83,200 6J,0Q 88,220 84,800 0 1 20.2 144.1 Batangas 20,770 20,038 43,870 37,010 45,330 43,000 42,302 28.3 103.7 Cavite 3,680 3,330 3,020 5,200 7,400 7,570 6,000 10.5 (Decrease) 64.7 Laguna 1,740 3,166 24,050 2,00 3,250 3,250 8,523 82.0 389.8 Marinduque 460 510 450 1,320 1,570 1,640 1,245 10.9 170.7 Mindoro 1,000 2,878 3,440 3,300 10,320 10,040 6,775 01.5 256.6 Palawan 670 3,000 2,400 60 830 830 1,203 ?48.7 79.6 Quezon 2,670 2,134 1,930 15,200 10.680 17,750 13,300 25.1 (Decre...e) 401.5 Rinal. 1,130 002 2,150 600 760 780 1,003 13.9 (Decrese) 3.4 (Decrease)

Bicol 23,720 29,534 356 5376 60,400 68,340 10.092 24.1 138.5 Albay 2,450 3,382 2,500 6,000 8,670 0,910 7,040 37.2 187.3 Camarines Norte 720 800 240 530 760 850 595 11.0 21.0 (Decrease) Camarines Sur 2,800 4,170 10,230 14,520 17,820 17,800 11,093 40.1 (Decrease) 439.0 Catanduanes 1,300 3,704 3,580 2,150 2,600 2,680 2,700 101.8 112.9 Masbat* 14,750 10,588 17,970 20,880 32,980 33,400 27,008 12.5 88.5 Soreogon 1,700 808 1,210 2,000 3,510 3,700 2,788 110.4 (Docrease) 04.0

Eastern Vissya 316,000 284,250 311,480 353,020 440,000 470,530 307,032 11.2 (Decrease) 25.9 Bohol 34,280 24,740 13,340 31,850 38,000 42,800 31,745 38.0 (Docrease) 8.0 (Decrease) Cebu 183,920 180,720 247,020 t 230,050 281,100 287,700 264,087 3.2 43.6 Lay e 92,600 65,252 38,000 84,940 .20,000 120,800 02,585 41.0 (Decrease) * (Decrease) Samar 5,200 4,532 13,120 7,080 8,710 0,230 0,535 14.7 (Decrease) 83.4

Western Viayss 172,420 177,508 221,820 238,080 204,000 211,050 210,137 3.0 27.1 Antique 8,030 0,510 2,070 7,120 0,750 0,650 0,147 23.5 (Decrease) 31.0 (Decrease) Capia 5,700 18,084 7,620 10.600 11,120 11,170 10,150 214.0 70.2 Iloilo 29,700 30,352 45,270 53,420 33,600 51,130 40,001 22.4 10.0 Negros Occidental 53,730 53,102 81,510 76,020 50,030 51,030 04,647 1.2 (Decrease) 20.3 Negros Oriental 73,620 61,500 80,780 78,300 83,100 70,450 70,087 10.7 (Decroae) 8.2 Roablon 1,500 1,408 4,370 12,470 18,240 15,520 11,000 4.1 (Decrease) 602.8

Northern and Eastern Mindanao 141,51 118,884 09,10 145,00 180,300 203,270 118,570 10.0 (Decrease) 12.1 Aguman 10,850 3,730 8,050 13,100 10,000 15,600 13,207 100.7 (Decrease) 21.6 Dukidnon 13,760 18,044 13,250 30,580 20,080 44,970 20,605 35.5 (Decrease) 115.8 Lanao 32,070 28,458 1,410 20,210 32,050 32,620 23,073 15.0 (Decrease) 42.9 (Decrease) Missai Occidental 40,110 40,000 52,500 30,500 37,840 30,220 3D.007 20.0 (Decrease) 23.4 (Decrease) Misamis Oriental 28,740 23,028 10,310 34,040 57,050 50,100 41,825 25.3 (Decreaso) 45.5 Surigao 6,070 4,512 8,500 10,100 12,480 12,080 10,903 34.5 (Decrease) 80.6 Southern and Western Mindanao 88,00 11053B 10 0 103,520 209,0 220,030 189,27 31.2 113.2 Catabato 31,230 43,882 49,010 42,520 52,000 48,500 48,247 40.5 54.5 Davao 16,780 23,338 45,000 45,700 58,200 71,240 55,80 39.1 228.2 Sulu 8,380 7,020 5,000 3,200 4.200 4,230 4,202 10.4 (Decrease) 99.0 (Decrease) Zamboanga Dal Norto 30,040 10,20 23,9801 24,350 24,647 - - Zamboanga Del Sur 34,000] 512320] 70,430] 71,050] 57,115] - - Zamboanga Provinces Total 32,410 42,300 64,700 71,940 04,410 06,000 81,762 30.5 152.3

Sources: DANR, Division of Agricultural Economics, Philippine Aricultural Statistics, Vol. II, 1856. Bureau of Census and Statistica, Yearbook of Philippine Statistics 1940. DANR, Division of Agricultural Economics. Stanford Research Institute. a Indicates less than one-half of one percent.

117 Table III- l-IV

CORN: PERCENT OF TOTAL AREA PLANTED BY REGION AND PROVINCE 1938-42; 1948-52; 1953-56

1938- 1946- 1953- 1938- 1948 - 1953­ 1942 1952 1956 1942 1952 1958 Philippines 100.0% 100.0% 100.0% Bicol . 2.0% 3.3% 4.4%

Manila Albay 0.3 0,4 0.6 Camarines Norte 0.1 0.1 0.1 Ilocos 9.2 2.1 1.4 Camurines Our 0.3 0.5 1.2 Canta:Juanes 0.1 0.4 0.2 Abra 0.6 0.7 0.4 Masbate 1.6 1.8 2.2 Batanea a a * Boreogon 0.2 0.1 0.2 Ilocos Norte 0.6 0.6 0.4 Ilocos Our 0.7 0.5 0.5 Eastern Viasyam 34.7 30,9 31.1 La Union 0.3 0.3 0.1 Bohol 3.7 2.7 2.5 Cagayan Valley 7.4 9.5 8.2 Cebu 20.2 20.6 20.7 Leyte 10.2 7.1 7.2 Cagayan 3.9 3.8 2.2 Samar 0.6 0.5 0.7 Isabsla 3.2 5.2 5.3 Mountain Province 0.1 0.2 0.4 Western Visayse 19.0 19.3 17.2 Nueva Vizcaya 0.2 0.3 0.2 Antique 0.9 0.7 0.5 Central IAmon 5.2 4.7 4.2 Capi: 0.6 2.0 0.8 21oil0 3.3 3.9 3.6 Pangasinan 2.3 2.5 2.2 Negros Octidental 5.9 5.8 5.2 Nueva Ecija 2.0 1.4 1.2 Negros Oriental 8.1 0.7 6.2 Pampangs 0.4 0.2 0.2 Roablon 0.2 0.2 0.9 Tarlac, 0.2 0.1 0.2 Dulacan 0.3 0.4 0.3 Northern and Western Mindanao 15.5 12.9 12.4 Bataan * 0.1 Zambales 0.1 * Agusan 1.2 0.4 1.0 Dukidnon 1.5 2.0 2.3 Southern Tagalog 3.7 4.6 6.3 Lanao 3.6 3.1 1.8 Mienmin Occidental 5.4 4.4 3.1 Batangas 2.3 2.9 3.3 Mienm Oriental 3.1 2.5 3.3 Cavite 0.4 0.4 0.5 Surigno 0.7 0.5 0.9 Laguna 0.2 0.3 0.7 Marinduque 0.1 0.1 0.1 Southern and Western Mindanao 9.7 12.7 14.8 Mindoro 0.2 0.3 0.5 Palawan 0.1 0.3 0.1 Cotabato 3.4 4.8 3.8 Quezon 0.3 0.2 1.0 Davao 1.8 2.5 4.3 Rizal 0.1 0.1 0.1 Sulu 0.9 0.8 0.3 Zamboanga (Total-Norte and Our) 3.6 4.6 6.4

Notes: Detail may not add to total due to rounding.

* Indicates less than one-half of one percent.

118 Table III-H-V

CORN: YIELD PER HECTARE BY REGION AND PROVINCE, PHILIPPINES 1938-1942; 1948-1952; 1953-1956 (Cavans per Hectare)

1938- 1948- 1953- 1938- 1948- 1953- Region and Province 1942 1952 11156 Region and Province 1942 1952 1956

Philippines 10.3 11.4 10.7 Dicol 9.1 11.4 10.6

Manila Albal 9.5 9.8 0.8 Camarines Norto 5.7 8.0 6.4 Ilocos 10.8 9.4 9.4 Comarines Sur 8.8 11.4 10.8 Catanduanes 13.1 7.9 7.0 Abra 11.1 10.2 13.8 Masbato 8.8 12.7 12.3 Datanes 10.4 1.0 12.2 Soreogon 9.7 10.7 7.7 Ilocos Norte 11.3 8.2 6.7 Ilocos Bur 10.2 14.1 8.4 Eastern Visayas 8.9 9.7 8.1 La Union 10.0 10.7 10.0 Dohol 8.9 10.4 5.8 Cagayan Valley 15.1 12.9 15.6 Cebu 7.3 8.2 8.1 LOyte 11.0 13.8 8.2 Cagayan 13.9 13.0 15.1 Samar 11.2 12.1 10.3 Isabela 16.8 13.2 16.8 Mountain Province 10.3 10.9 6.1 Western Visayas 8.1 10.3 10.4 Nueva Vizcaya 12.0 8.1 7.2 Antique 8.7 7.9 4.8 Contral Luzon 10.5 10.1 9.3 Capiz 10.9 9.2 5.7 Iollo 7.4 9.8 10.7 Pangaminan 12.4 10.9 10.2 Negron Occiden tal 9.1 11.7 12.3 Nueva Ecija 9.2 9.3 8.7 Negros Orionta 7.0 9.9 10.6 .1 Pampanga 8.2 8.2 11.5 Romblon 7.2 13.7 3.8 Tarlac 8.9 7.3 6.9 Bulacan 9.8 9.4 0.7 Northern and Eas tern Mindanao 11.7 12.5 9.6 Batman 8.8 12.2 5.9 Zambales 9.5 10.2 7.5 Aguman 11.2 18.1 11.2 Dukidnon 12.2 15.4 8.3 Southern Tagalog 7.4 10.5 11.7 Lanno 13.t 13.0 11.7 Minsais Occide ntal 10.4 11.1 12.2 Iatangas 7.2 11.4 14.7 Misami Orient al 13.1 11.1 7.6 Cavite 4.6 4.0 8.2 Surigno 11.0 12.0 10.4 Laguna 10.3 10.8 13.2 Marinduque 9.8 9.0 5.0 Southern and We. tern Mindanao 15.3 10.1 14.0 Mindoro 9.4 6.2 4.0 Palawan 8.6 8.9 13.2 Cotabato 19.9 19.7 19.2 Quezon 7.6 9.7 7.3 Davao 14.6 15.8 17.3 Rizal 11.2 9.7 9.6 Sulu 9.5 11.0 15.6 Zamboansa (Tot al - Norte and Sur) 12.8 13.4 10.1 Skction IV

AGRICULTURAL COMMODITIES--COMMERCIAL CROPS

V

t,. N~ - NJ; I;

r

p2ft COCONUT AND COCONUT PRODUCTS

PREVIOUS PAGE BLANK Coconut and Coconut Products

In 1955, the area planted to coconuts was approximately 990,000 hectares or 15 percent of the area planted to all crops. There were about 165 million bearing coconut trees yielding between 4.5 and 5 billion nuts.l/

Demand for transportation facilities in 1955 was generated prin­ cipally by the movement of copra--dried coconut meat--used for the production of coconut oil. About 90 percent of all coconuts grown were converted into approximately 1,070,000 metric tons of copra. The bulk of this production, about 827,000 metric tons, was exported as copra; the remainder, approximately 243,000 metric tons, was shipped to coco­ nut oil mills located within the Philippines. Slightly less than half of the coconut oil produced was exported; 51 percent was processed into soap, margarine, and other final products for local consumption. Copra cakes and meal, by-products of coconut oil production, were almost entirely exported and amounted to 81,600 metric tons in 1955.

In addition to the movement of copra, shipments of coconuts to factories for the production of desiccated coconut and the subsequent movement of this confection to ports of export generated a demand for transportation facilities. About 5 percent of all coconuts grown in 1955 were used to produce about 45,000 metric tons of desiccated coco­ nut, all for export.

Other uses of coconut are as food and home-made oil. Transporta­ tion requirements in these uses of coconuts were small.

Methods of Marketing Copra

Coconuts are grown on farms which average between four to five hectares in size.Y/ Individual farmers harvest the nuts throughout the year usually at intervals of 45 days.

1/ Estimates of Bureau of Agricultural Extension and Stanford Research Institute. 2/ DANR, Division of Agricultural Economics, Philippine Agricultural Statistics, Vol. II, 1956, p. 83.

125 PREVIOUS PfACE BLA~JI After harvesting, the farmer removes the husk and splits the coconut shell. Copra is produced by drying the coconut meat in the shell. Drying is most commonly done by placing the half shells in piles over the heat of a fire. This process is performed in small drying huts or tapahans. In some instances, owners of tapahans purchase nuts and produce copra, In addition, the Philippine Coconut Administra­ tion has a program to install copra dryers which will yield a higher grade of copra. At present, however, the great bulk of copra is pro­ duced in small tapahans owned by each individual farmer. There is some sun-dried copra in the Philippines, particularly some of the copra pro­ duced in Cebu, and some farmers will initially dry the coconut meat in the sun before final drying in the tapahan.

After drying is completed, the copra is removed from the shell and stored for a short period by the farmer. It is then usually placed in sacks weighing approximately 50 to 60 kilos.

Copra is finally transported from producing areas to offshore vessels for export to world markets, or to coconut oil mills. The primary concentration point in this movement is the bodega of a copra dealer. Primary bodegas are located at ports or sites from which copra is loaded onto offshore vessels; shipped to major ports for transship­ ment to offshore vessels or shipped to coconut oil mills.

The patterns and methods of transporting copra from the producer to the primary bodega are diverse. One method involves the producer's transporting the copra in sacks or sometimes in baskets directly to the bodega by carabao cart, banca, or bus in small unit loads and usually in short hauls. A second method is for the producer to trans­ port the copra to a subagent or collection point where the copra is collected and transported to the bodega by trucks owned by the copra dealer. By a third method, copra, purchased directly from producers, is transported to bodegas located at larger ports by boats which call at numerous small shipping points and ports along the coast. A fourth method involves subagents who will collect the copra from producers and sell to the ships calling at the shipping points and ports.

Where water transport is used to collect and transport copra, numerous subagents, handling operations, and transshipments over con­ siderable distances are commonly involved before the copra is delivered to the primary bodega, which may be located at a port outside and at a significant distance from the original producing province and area. For example, the bodegas of copra dealers at Cebu City are to a large extent primary concentration points for producing areas covering a broad geographical region.

126 At the primary bodega the copra is further dried, graded, and stored for shipment in sacks weighing 50-60 kilos.

From the primary bodega the copra may be loaded directly to offshore vessels, shipped to major ports for transshipment or shipped to coconut oil mills. In the movement of copra from the primary bodega directly to offshore vessels various methods of delivery to the pier site and loading are employed.

Copra which is shipped from a primary bodega to a port for trans­ shipment to offshore vessels is usually stored in a secondary bodega at the port of transshipment. The secondary bodega is a secondary concentration point. For example, copra bodegas at Cebu City are both primary and secondary concentration points for the movement of copra to offshore vessels. Shipments from primary bodegas to secondary bodegas do not usually involve re-drying and classification of the copra. The methods of loading offshore vessels at ports for transshipment are discussed in Volume III, Domestic Water Transportation and Ports.

In the case of the shipment from the primary bodega to coconut oil mills, the copra moves directly by truck and ship to the mills. The Manila Railroad also transports copra to mills located in the Manila area. The locations of coconut oil mills are shown in Figure IV-4.

Coconut oil for export is shipped from the mills in lighters to offshore vessels. The lighterage operation at Manila is handled by the Atlantic Gulf and Pacific Company. The mills have tanks at sites where the lighters can load the coconut oil from the tanks. The tanks are supplied by tank trailers when transportation of oil to the tank site is required.

Methods of Marketing Desiccated Coconut

The desiccated coconut factories shovn on Figure IV-5 purchase whole coconuts with the fibrous husk removed for processing into desiccated coconut. The nuts are purchased from dealers who collect the nuts from the regions adjacent to the factories extending to a radius of as much as 80 kilometers.

Peter Paul Philippines Corp. receives some coconuts from Mindoro and Marinduque. In most cases the dealers deliver the nuts to the factories in their own trucks. However, in a few cases, the desiccated coconut companies hire trucks and collect the nuts from the region. In

127 Lucena Oil Factory International Oil Factory IRoyal Mfg. Co. Central Vegetable Oil Mtg. Co. Inc. Luson Industrial Corp. Philippine Mfg. Co. Phiiippine Refining Co.

San Pablo Oil Factory Inc. Lacopra Corporation

Visayan Mg. Co." Lu Do and Lu Ym

0

Wee Ken Coprax

FIG. IV-4 MAJOR COCONUT OIL MILLS 1956

128 1.

Products, Inc. Franklin Baker Co. of Phil. San Pablo City (Laguna)

Blue Bar Coconut Co. Timong, Quezon Red V Coconut Products Co. Recordo, Quezon

Peter Paul Phil. Corp. Condelarie, Quezon

0

Red V Coconut P Oroquieta, Mie. O

Blue Bar Coconut Products Company Zamboanga City

a,

FIG. IV-5 DESSICATED COCONUT FACTORIES 1956

129 the case of the Red V Coconut Company at Oroquieta, Misamis Occidental, company-owned trucks collect about half the tonnage shipped to the factory. The Blue-Bar Coconut Company plant at Recordo, Zamboanga City, receives most of the coconuts used in the factory from Basilan Island. These are lightered to Zamboanga City by company-owned launches and barges.

Desiccated coconut is moved generally in sacks of 100 pounds and to some extent in 25-pound bags. It is shipped principally by truck from the five factories to bodegas in Manila located at sites accessible to lighters. The Franklin Baker Co. ships most of the desiccated coco­ nut to the bodega at Manila by rail, and Blue Bar Coconut Company and Sun-Ripe Coconut Products, Inc.,also utilize the Manila Railroad Company for some shipments. From the bodega at Manila, the desiccated coconut is lightered to offshore vessels.

At Zamboanga City, the bags of desiccated coconut are loaded directly from the pier to offshore vessels after being trucked from the factory.

The Red V Coconut Company plant at Oroquieta trucks the desiccated coconut to the pier at Oroquietawhere it is loaded in interisland ves­ sels for shipment to Cebu. At Cebu, it is placed in a bodega and loaded on offshore vessels from the pier.

Origin and Destination of Copra, 1955

On Figure IV-6, six copra regions have been outlined. The geo­ graphical boundaries of these regions are based on two conclusions derived from the analysis made of the copra movements to ports of export and coconut oil mills. First, the great bulk of the movement of copra occurs within each of the regions described. The shipments of copra among the regions constitute a small part of the total demand for trans­ portation iacilities generated by copra movements with the Philippine Archipelago.1/

Second, each of these regions has a center or focus which receives the shipments of copra for transshipment to offshore vessels or to

1/ Although interregional copra movements are a small percentage of the total movement of copra they are of sufficient tonnage in rela­ tion to other agricultural commodity flows to be included in the analysis. 130 / / / / / / / / 0 '3 /

/ /10 / %/.o / oe

FIG. IV-6 REGIONS OF COPRA PRODUCTION 1955 -Legend­ (metric tons)

*- 50,000

- 30,000

- 10,000 1-o

C?

'4

FIG. IV-7 ESTIMATED COPRA PRODUCTION 1955

132 coconut oil mills. Thus for example, Manila and its environs is the center of Region I, the southern Tagalog region. The importance of Manila and its environs is primarily based on copra shipments to coco­ nut oil mills. Cebu, the leading copra port of the Philippines, serves as the focus of copra transshipments for export for the broad geographi­ cal region encompassing the eastern Visayas-northern and eastern Mindanao and the northern coast of Zamboanga del Norte (Region III). In addition, Cebu is the location of the coconut oil production of this region.

In the western Visayas (Region IV), Iloilo City and Dumaguete, Negros Oriental, are two focal points for copra shipments while Zamboanga Cicy and Davao City are the centers for Region V and VI respectively.

Producing Areas

Figure IV-7 and Table IV-I show the distribution of copra produc­ tion by region and province according to the estimate of the Division of Agricultural Economics.1/ Region I comprises the southern Tagalog provinces and includes Romblon, the northwestern part of Capiz and western Masbate. Approximately 30 percent of the copra in the Philip­ pines was produced in this region. Quezon was the leading producer of this region as well as of the entire archipelago.

The Bicol provinces excluding Masbate make up Region II. Approxi­ mately 12 percent of total production originated in this region. Sorsogon was the leading province in production.

Region III, which covers the largest geographical area, includes the eastern Visayas; the provinces of northern and eastern Mindanao; and in addition the northern coast of Zamboanga del Norte. Approxi­ mately 39 percent of total copra was produced in these provinces.

Region IV comprises the western Visayas; Region V, western Mindanao; and Region VI, southern Mindanao, principally Davao province. The com­ bined production of these three regions was approximately 19 percent of the total copra produced in the Philippines during 1955.

1/ The estimates of total copra produced as shown in Table IV-II are higher than data published by the Division of Agricultural Economics (in Table IV-I). The percent distribution of copra production by regions, however,.is approximately the same.

133 Table IV-I

ESTIMATE OF COPRA PRODUCTION BY REGION AND PROVINCE, 1955

Production Percent of Region and Province (Metric Tons) Total Production REGION I - SOUTHERN TAGALOG 292,100 3006

Batangas 14,900 Cavite 4,500 Laguna 45,400 Marinduque 18,700 Mindoro 17,500 Palawan 7,400 Quezon 149,200 Romblon 21,200 Western Masbate 8,500 Northeastern Capiz 2/ 4,800 REGION II - BICOL 110,300 11.5

Albay 29,500 Camarines Norte 14,400 CanmRrines Sur 24,100 Catanduanes 5,600 Sorsogon 36,700

REGION III - EASTERN VISAYAS - NORTHERN & EASTERN MINDANAO 374,300 39.2

Eastern Masbate 16,900 Cebu 47,400 Bohol 26t800 Samar 62,900 Leyto 53,000

Agus an 15,700 Surigao 35,100 Misunis Oriental 50,700 Lanao 90800 Misamis Occidontal 41,200 Northern Zamboanga del Norte 3/ 14,800

z I

134 Table IV-I (Continued)

ESTIMATE OF COPRA PRODUCTION BY REGION AND PROVINCE, 1955

Production Percent of Region and Province (Motric Tons) Total Production

REGION IV - WESTERN VISAYAS 57,200 6.0

Antique 3,700 Capiz j 9,500 Iloilo 12,300 Negros Occidental 10,600 Negros Oriental 21,100

REGION V - SOUTHWESTERN MINDANAO 73,800 7.7

Western Cotabato S/ 13,800 Western Zamboanga del Norte 6/ 15,600 Zamboanga del Sur 14,800 Sulu 29,600

REGION VI - SOUTHERN MINDANAO 47,600 5.0

Davao 47,100 Southern Cotabato j 1,600

1 1/3 total production of Masbate 2/ 1/3 total production of Capiz 3j 1/4 total production of Zamboanga del Norto and Zamboanga del Sur combined. 4 2/3 total production of Capiz i/ 9/10 total production of Cotabato p/ 1/4 total production of Zamboanga del Norte and Zamboanga del Sur combined. 1/10 total production of Cotabato

SOURCE: Departnint of Agriculture and Natural Resources, Division of Agricultural Economics Stanford Research Institute.

135 The Movement of Copra

The demand for transportation facilities generated by copra move­ ments from producing areas within each of the six regions to ports of export and coconut oil mills will vary depending upon:

(1) The quantity of copra exported directly to offshore vessels from ports located in producing provinces.

(2) The quantity of copra shipments to major ports for transship­ ment to offshore vessels.

(3) The quantity of copra shipments to coconut oil mills.

Table IV-II summarizes the estimates made of the origin and desti­ nation of copra shipments in the Philippines during the calendar year 1955 (see Appendix IV-A for notes and sources to Table IV-II.) The following conclusions were derived from an analysis of the data pre­ sented in Table IV-II.

Total Philippines

1. Approximately 1,070,200 metric tons of copra were produced in the Philippines during the calendar year 1955.

2. About 77 percent of the production or 827,200 metric tons were exported and 23 percent or 243,000 metric tons were processed into coco­ nut oil.

3. Total copra exports were shipped from 28 ports throughout the regions shown. Fifty-nine percent of total exports or 490,700 tons were shipped directly to offshore vessels from ports located in pro­ ducing provinces while 41 percent of total exports were shipped to major ports for transshipment to offshore ships.

4. The combined shipments to major ports for transshipment and to coconut oil millswere 579,500 metric tons. Therefore, 54.0 percent of all copra produced moved directly offshore and 46.0 percent was shipped between provinces for transshipment or to coconut oil mills.

5. Of the total shipments of copra to coconut oil mills 49 percent were for coconut oil for export and 51 percent were made to fill require­ ments of coconut oil for the manufacture of soap, margarine, and other products for the domestic market.

136 Table IV-11

ORIGIN AND DESTINATION OF COPRA SHIPMENTS, PHILIPPINESY Calendar Year 1955 (Metric Tons)

* - a 1h a 2 . b e 3 4 . 4.a a 4.b I 4.a 4 4.4 1 4.g I COPREXPORTS COPRAOHIFFED TO COCONUTOIL WILtd: TOTAL IS.AE 0805O Hiltl T AO OT I

Total tQuantity1Quantityi Total I Coed :Cooonet 011: Copra Totalso. J pert@ of I skipped ireceived I Copra re. i oil I for load 1 6 1 pra re o opra I dirsatlyls t ajoer I soltredat i eroted oonsm-ptions Copra I s*lvedby I Totaltroal All05tW1a, PALMlROSAND MOT Proviness a Totaltrom Provisoes ; ff shoreSports for a coocnut I -I eq In : m r pot Ithlm region I outsidereties I ree portsastrans-ship-1 oil rtlls i(aopra equtd(oopra sqwo oou n oaut I a ocated in: mients II vlet) a talent I oll I oilmills 1 Si .pr oduig a a o I 1 00 1(oue 9l I eprovinces I I I4 I I I1.b plus 1) tetrio To exetrl Teneagatrie TensiNtrio Tonsi.etrio ";oasktrio Tonomestrio TonatUetrie Tonspthtria Tonel Pareent Prvovc IVoble Tos Perewnt I 1911LIPPIVE8 .17,200 41,10., t 3,0 248,000a1 1188000 1 1168000 1,a.70.2nna 170,r.00I 543,000)93.8 3,0 R~ntll - 8RITEIG TAG.AWS 1.....0. a9 FOmHI0 Qati _p y 67,000- 11 000 9000 0 4 800 .na o 1 0 .o IIlillA AllD NVIRCIS 88,500d. EDO8,50 170,000 Al87000w 111.000 - 2008500

*~~~~1 *6 * 8 * g . 4 n 00 T Det o 1 01#800 I lianduque SPot I 4101. g .o * *o I I,00 1 1.0 1 Iloilo I 800 1 I 11IIndore 14*.100 ,00 a . I .0 3. I All other1 2,800OOI I Qutzbsaaran

filondue '"u.. 12.0:9 Too3.000 1 1 A ICOL I R O i I I GD* * 1 00 I * D4,8 * 48. . 1 * 1 0 I .3600 1

I Jose t.ar" anibe 9 7000 1 * * * . g .

I C~ I~~~~~10,000 1 *. * e ,0 o 5Dve 1 00 1 a - a ,10 1 a * * . * I1 * Ctbt.I 8000 a. IAMtbat I 11 9310 0 a, . Q .- 1 1 2 .0 - * 0 3 0 . 1 0 . as q o n ,0

8 34.00 1 . * 1 17 40 1. 3 .0 gu I tsspt an 18.01 I2 7, 0C M

1780 I * I I I I * . 1 I ,200 1 . 1 1 1, 0 I 50 a 1 Ii o I Ia ,

SOHR &iseAsleOoletHa a 10,100 9 *1, n ~a , 0 1 U810 I 2.a *m* 214, 5 0 ".100 8 1 , 00 10 .0 4 00 1 10. 1

U. stbonaDeate 5 i 8.70 I 4g 4 *A,0 *110 4 A00 .,, g . g 1,80 gt t ;11500 a 800 Dat 11o0000 C J Cnte g 11a

-0 *0: 10 00 ao " 1 9 0 . I obt 1 8,0 4 1000 a ,0 1 1 .20 * * * 1 .300 : a j

TOO~~~ I.. n3 700 1 7.

5.~y Wetr daaso Ore - I ndreero cs

I 1/ 1 AppeIe ndi .V fr suce

137 Interregional Movement of Copra

1. Most of the copra shipments throughout the archipelago took place within each of the six regions described. Of the total copra shipments within the Philippines an estimated 36,500 metric tons, about 3 percent of the total 1,070,200 metric tonsmoved between regions.

2. The major interregional movements were between Davao and Negros Occidental and Negros Oriental, Cotabato and Cebu. The second­ ary movement was between Davao and Manila.

Regions and Major Copra Centers

1. Region III

The eastern Visayas, northern and eastern Mindanao and northern Zamboanga del Norte constitute the most important copra region in the Philippines. In 1955, 458,100 metric tons (or 43 percent of the total of 1,070,200 metric tons) were shipped to ports of export or coconut oil mills within this region. The primacy of Region III is based on the exports of copra. 407,100 metric tons were exported in 1955 which comprised 49.2 percent of all copra exports of the Philippines in 1955. In addition, 36 percent (43,900 metric tons) of coconut oil exports and 6 percent (8,000 metric tons) of the copra used for coconut oil for domestic use were processed at Cebu City. This comprised 20 percent of the copra shipped to coconut oil mills in the Philippines.

a. Of the exports of copra of 407,100 metric tons from the region, 219,600 metric tons or 54 percent were shipped directly to offshore vessels from ports located in producing provinces while 43 percent or 187,500 metric tons were shipped to Cebu City for transshipment to offshore vessels.

b. In addition Cebu City received 51,000 metric tons of copra for coconut oil mills. Thus a total of 238,500 metric tons were shipped to Cebu either for transshipment or for coconut oil mills.

Shipments Directly to Offshore Vessels. The 219,600 metric tons of copra shipped directly to offshore vessels were exported from 11 ports, 10 outlying ports and the port of Cebu; i.e. the direct offshore ship­ ments which originated in the province of Cebu.

138 The movement of copra to the 11 ports of export located in pro­ ducing provinces in this region was by boat and by truck where roads extend to adjacent producing areas and are in suitable condition. Quantitative data on the amount of copra moving to bodegas in the 10 outlying ports by truck as compared with water transport are not available. However, as indicated by the large number of copra shipping points in this area and the poor condition or lack'of roads along the eastern and northern coast of Mindanao, western and southern Leyte, Samar, and Masbate, a large percentage of the copra moves to.these ports by water transport.

Shipments to Cebu for Transshipment and Coconut Oil Mills. Of the total of 238,500 metric tons of copra shipped to Cebu City for trans­ shipment to offshore vessels or for coconut mills, an estimated 90 per­ cent originated in producing provinces within the region. Table IV-II, Column 4-b, shows the origin of these copra shipments.

The copra movement to Cebu is probably the most complex pattern of any of the commodity flows in the Philippines. Figu2e IV-8 indicates the major points of origin of copra shipped to Cebu City. The copra was shipped to Cebu from an estimated 91 shipping points within the region alone. These shipping points range in size from ports the size of Tagbilaran, Bohol, Tacloban, Leyte, and Cagayan de Oro, Misamis Oriental to small barrios which have no pier or port. Therefore, every type and size of vessel is used to transport the copra to Cebu. These vessels call at ports with commodities for local use and collect copra directly from producers or small copra dealers in small unit loads ranging as low as 1 and 2 tons., The interisland vessel is a floating market for many of these small copra producing areas and represents the sole market to the copra producer.

Within this highly diverse and complex pattern of transportation apparently an important percentage of the tonnage is shipped among the 91 shipping ports before arriving at Cebu. This is indicated by a comparison of total shipments and adjusted production estimates for each province within the region. (See Table IV-III.) Particularly evident are the large excess of shipments over production of Leyte and Bohol. It appears that ports in western and southern Tagbilaran, Bohol receive shipments from ports along the coast of Agusan, Surigao and Misamis Oriental, while large shipments are made from Samar to Leyte, to the port of Tacloban by small boat. In addition, Iligan apparently receives shipments by boat and truck from points along the coast of Misamis Oriental and Misamis Occidental. Some of the copra from Pagadian, Zamboanga del Sur is shipped to Iligan by truck.

139 SOURCE: Dr. Frederick Wernatedt. FIG. IV-8 ORIGIN OF COPRA SHIPPED TO CEBU

140 Table IV-III

COMPARISON OF ESTIMATES OF TOTAL SHIPMENTS AND ADJUSTED TOTAL PRODUCTION 1 ' FOR COPRA REGION III, BY PROVINCE, 1955

Production Total Shipment Surplus or (Exports & Ship- Adjusted (Deficit) over ments to Cebu) Production Total Shipment Region and Province (Metric Tons)& (Metric Tons)2/ (Metric Tons)

REGION III--Eastern Visayas-Northern and Eastern Mindanao 434,600 434,600 Eastern Masbate 27,000 19,600 (7,400)

Cebu 47,400) ) 55,200 1,800 (Camotes) 6,000)

Samar 29,100 73,000 43,800

Leyte 107,500 61,300 (46,200)

Bohol 46,800 31,300 (15,500)

Agusan 10,500 18,300 7,800

Surigao 35,700 40,900 5,200

Misamis Oriental 43,600 58,700 15,100

Lanao 19,500 11,300 (8,200)

Misamis Occidental 47,500 47,800 300

Zamboanga del Norte 14,000 17,400 3,400

Note: Figures may not add to totals due to rounding.

1/ Table IV-II Columns la plus 4a. 2/ Percentage of total production of region by province as estimated by Division of Agricultural Economics adjusted to total shipments, derived as follows using DAE estimates, Samar produced 16.8 percent of copra of Region III. Applying this percentage against total shipments of 434,600 metric tons, the estimate of 73,000 metric tons is derived.

Sources: DANR, Division of Agricultural Economics. Stanford Research Institute,

141 2. Region I

The southern Tagalog provinces, western Masbate, northwestern Capiz and Romblon comprise the second most important copra region in the Philippines. 295,600 metric tons of copra (28 percent of the total of 1,070,000 metric tons) moved to ports of export or coconut oil mills in this region. The importance of the region was based primarily on the shipments of copra to coconut oil mills and secondarily on the exports of copra.

a. 170,000 tons of copra were shipped to coconut oil mills in Manila and environs which comprised 70 percent of the 243,000 metric tons of copra shipped to coconut oil mills in the Philip­ pines. Coconut oil factories in Manila and environs produce 48 percent of the coconut oil exports and 90 percent of the coco­ nut oil for local consumption.

b. Exports of copra from this region totaled 125,600 metric tons or 15.2 percent of total exports of copra from the Philip­ pines. Of these 125,600 metric tons, 70 percent (or S9,300 metric tons) were shipped directly offshore while 30 percent or 33,300 metric tons were shipped to Manila for transshipment to offshore vessels.

c. A total of 206,300 metric tons of copra were shipped from producing provinces to Manila and its environs to coconut oil mills and for transshipment combined.

Shipment of Copra to Manila and its Environs for Coconut Oil Mills and for Transshipment. It has been estimated that 97 percent or 200,300 metric tons of shipments to the Manila area were from provinces within the region, while 3 percent or 6,000 metric tons were from pro­ vinces outside the region. (See Table IV-II, Column 4a.) About 35,000 tons were shipped to Manila by interisland vessels. 29,000 metric tons originated in the region while 6,000 tons were shipped from ports outside the region. The principal supplier outside the region was Davao. These shipments represent very small unit loads picked up by vessels operating between Manila and provincial ports. All shipments of copra received in Manila by water transport were pur­ chased by the coconut oil mills; i.e. no copra was transshipped from interisland vessels to offshore vessels. Figure IV-9 shows the flow of copra into Manila by interisland vessel.

The remaining 171,300 metric tons shipped to Manila, all moved by land transportation. The greatest percentage originated in Quezon

142 SOURCE: Dr. Frederick Wernstedt. FIG. IV-9 MONTHLY SHIPMENTS OF COPRA INTO THE PORT OF MANILA

143 Province (45.6 percent), and secondarily, Laguna (27.6 percent). Most of the 171,300 metric tons came to Manila by trucks owned by copra dealers of the producing provinces. In 1955, the Manila Railroad transported 29,227 metric tons of copra on the Southern Lines. Data on the direction of copra shipments on the Southern Lines are not available.

As has been shown on Figure IV-4, most of the mills are located very close to Manila. The largest mill outside of the immediate Manila area is San Pablo Oil Factory,Inc. at San Pablo City. The truck haul of copra is shorter from producing areas to this mill. However, the movement of oil and copra cakes and meal from San Pablo to Manila by truck tank trailers generated approximately an equivalent demand as the copra moving into mi.ls at Manila.

Shipments of Copra Directly to Offshore Vessels from Ports Located in Producing Provinces. The 89,300 metric tons of copra shipped directly to offshore vessels were exported from 7 ports within the region. Four ports were located in Quezon province which exported 69,300 metric tons in 1955 directly to offshore vessels. The movement of copra to these ports was made by truck supplemented by shipments in boats and bancas as well as carabao carts. Marinduque, Mindoro, and Romblon exported 14,100 metric tons, 3,600 metric tons and 2,300 metric tons, respectively from the ports of Pangi, Quinabigan and Romblon. These ports received most of the copra from producing areas by water transport. This is indicated by the lack of roads on each of these islands.

3. Region II

The Bicol Region was the third most important region. 123,000 metric tons (or 11.5 percent of the total of 1,070,200 metric tons) moved to ports of export in this region in 1955.

a. The volume of copra moved through this region is based solely on copra exports. Copra exports (123,000 metric tons) comprised 14.8 percent of total exports from the Philippines.

b. Of the total exports,63,300 metric tons or 51 percent were shipped directly to offshore vessels while 49 percent or 59,700 metric tons were shipped to Legaspi and Tabaco for trans­ shipment to offshore vessels.

c. Shipments Directly to Offshore Vessels. Shipments directly to offshore vessels were made from four ports, Legaspi

144 and Tabaco, Albay; Jose Panganiban, Camarines Norte; and Bulan, Sorsogon. An estimated 32,800 metric tons were shipped from Legaspi and Tabaco directly offshore. Most of the copra shipped to Legaspi and Tabaco ports were by trucks because of the good condi­ tion of the roads into these two ports. Jose Panganiban in Camarines Norte received most of the copra by truck from within the province and by boat transport along the coastline of Camarines Norte. In Bulan, Sorsogon, truck and boat transport were also used to transport the copra to the port of export.

d. Shipments to Legaspi and Tabaco for Transshipment. The bulk of copra shipped to these two ports (about 59,700 metric tons) originated from the eastern coast of Sorsogon and in Camarines Sur. Catanduanes supplied about 6,300 metric tons which were shipped from the points shown in Figure IV-10. Practically no shipments originated outside the region.

4. Region V

Western Mindanao is the fourth region in importance. 84,100 metric tons (or 7.9 percent of the total 1,070,200 metric tons) were moved to ports of export or coconut oil mills in this region.

a. Copra exports were more important than copra shipments to coconut oil mills. 66,100 metric tons of copra were exported which comprised 8.0 percent of total exports of the Philippines. 61 per­ cent or 40,100 metric tons were exported directly to offshore ves­ sels while 39 percent or 26,000 metric tons were shipped to Zamboanga City for transshipment to offshore vessels.

b. Shipments to the coconut oil mill at Zamboanga City totaled 18,000 metric tons which constituted 7.4 percent of all copra processed at coconut oil mills in the Philippines.

c. The total shipments of copra to Zamboanga City for trans­ shipment and coconut oil processing were 44,000 metric tons.

Shipment of Copra Directly to Offshore Vessels. The estimated 40,100 metric tons shipped directly offshore were shipped from three ports, Zamboanga City, Isabela de Basilan, and Jolo, Sulu Archipelago.

The direct offshore shipments from Zamboanga City have been estimated to originate in Zamboanga del Sur and Zamboanga City in areas accessible by road. While those for Isabela de Basilan are from Basilan Island. The copra received at Isabela de Basilan was

145 CD

~g3

SOURCE: Dr. Frederick Wernstedt.

FIG. IV-10 MONTHLY SHIPMENTS OF COPRA INTO THE PORTS OF TABACO AND LEGASPI

146 principally by small boats which stop along the coast line at small shipping ports of the island. The use of trucks is restricted because of the condition and lack of roads.

On the island of Jolo, the shipments to Jolo were by truck and by small boats collecting from numerous producing points along the coast line.

Shipments to Zamboanga City for Transshipment and for Coconut Oil Mills. Of the total of 44,000 metric tons of copra shipped to Zamboanga City, the majority originate in producing areas along the coast of Zamboanga del Sur, the western coast of Cotabato province, about halfway up the western coast of Zamboanga del Norte, and Sulu and Basilan Island. These shipments were made practically entirely by water transport, since there are no roads connecting these producing areas with Zamboanga City. Figure IV-11 shows the flow of copra into Zamboanga City by interisland vessels.

5. Region IV

The western Visayas is the fifth most important region. 55,800 metric tons (or 5.2 percent of the total of 1,070,000 metric tons) were shipped to ports of export and coconut oil mills in this region. Copra exports were 51,800 metric tons while only 4,000 tons were shipped to the coconut oil mill at Iloilo City.

a. Of the 51,800 metric tons of copra exported, 32,800 metric tons have been classified as direct offshore shipments. This com­ prised 63.7 percent of exports from the area. The remaining 19,000 metric tons were shipped to Iloilo City and Dumaguete for trans­ shipment to offshore vessels.

b. 4,000 metric tons were shipped to qoconut oil mills all of which were used in the domestic market of Iloilo City.

Shipments Directly to Offshore Vessels. The 32,800 metric tons of copra shipped directly offshore were exported from Iloilo City and Dumaguete. It can be assumed that this much originated in the provinces of Iloilo and Negros Oriental. From producing areas of Iloilo province the shipments to Iloilo City were made by truck and boats from shipping points along the western and southern coastline.

In Negros Oriental most of the copra was probably shipped to Dumaguete by water transport. The condition of highways to copra pro­ ducing regions is poor and therefore boats probably pick up most of the

147 SOURCE: Dr. Frederick Wernatedt. FIG. IV-11 MONTHLY SHIPMENTS OF COPRA INTO THE PORTS OF ZAMBOANGA AND CAGAYAN

148 copra. Therefore, the pattern is similar to that which prevails for shipments to Dumaguete for transshipment.

Shipments to Iloilo City and Dumaguete for Transshipment and for the Coconut Oil Mill at Iloilo City. Shipments to Iloilo City for transshipment and for coconut oil mills were approximately 13,000 tons in 1955. These shipments were from Antique, Capiz, and the western coast of Negros Occidental.

Shipments to Dumaguete which totaled 10,000 metric tons were from the ports and shipping points along the eastern coast of Negros Occi­ dental and Negros Oriental.

In addition to the above shipments approximately 8,000 metric tons were shipped to Cebu from ports in Negros Oriental and Negros Occidental, principally Dumaguete and San Carlos.

6. Region VI

in southern Mindanao 53,600 metric tons (or 5.0 percent of the total of 1,070,000 metric tons) were moved to the port of Davao for export.

a. The movement of copra directly to offshore vessels has been estimated at 45,600 metric tons while shipments to the port of Davao for transshipment have been estimated at 8,000 metric tons.

b. Since Davao is the only port which ships directly offshore as well as the only port receiving shipment for transshipment, the patterns of movement for both types of shipments are close to the same.

c. Shipments of copra to the port of Davao are principally from within the province. These originate in producing areas along the coast line of Davao province and are shipped by water transportation to the port of Davao. (See Figure IV-12.) Truck movement is held to a minimum since roads along the coast line do not exist in most of the area.

d. About 3,000 metric tons are shipped from small shipping points along the southern coast of Cotabato province.

e. In addition to these shipments about 13,000 metric tons were shipped from this region. 11,000 metric tons went to Cebu

149 SOURCE: Dr. Frederick Wornstedt. FIG. IV-12 COPRA INTERISLAND SHIPPING PORT OF DAVAO while about 2,000 metric tons were shipped to Manila. These copra shipments were collected at many small ports as well as the port of Davao. (See Figure IV-8 and Figure IV-11.)

Transportation Needs and Improvements in the Movement of Copra

1. In 1955 copra was the third most important export commodity measured in total tonnage shipped within the Philippines. However, although the total tonnage in 1955 was smaller than sugar products (sugar and molasses combined) or lumber and logs, the total demand for transportation facilities generated by copra movements was probably greater than either of these product groups due to the geographical distribution of copra production and the methods of transporting copra to ports of export and coconut oil mills.

2. In the next decade copra will increase in importance as an export commodity relative to sugar production.

3. There may be a few areas in the Philippines where develop­ mental roads may directly encourage production of coconuts. However, because coconut farms are widely distributed and located in coastal areas, increased production will occur almost entirely in present producing areas.

4. The major relationship between coconut production and improve­ ments in transportation facilities is therefore through cost saving and the indirect effects which may accrue to the copra producing segment of the economy.

5. The focus of the analysis on transportation needs and improve­ ments in relation to the movement of copra should be on the economies which may be achieved through lowering the cost of transporting copra and by increasing the marketing alternatives to the producer of copra.

6. The problems of transportation of copra from producing areas to ports of export and coconut oil mills are intraregional. The move­ ment of copra between the regions defined above does not represent a significant transportation problem. There are no apparent economies to be obtained by attempting to induce increased interregional movement by improved transportation.

7. The problems of transportation of copra within the six copra regions may be divided into three parts: (1) the movement of copra

151 from producing areas to the primary concentration points (todegas), (2) the movement of copra from primary concentration points to export ports, (3) the movement of copra from primary concentration points to coconut oil mills.

8. In the Philippine Archipelago there is an inherent necessity for the use of water transport in the movement of commodities. How­ ever, the most important problem of transportation of intraregional copra movements is the excessive use of water transportation in the shipment of copra from producing areas to primary concentration bodegas.

9. More specifically, the problem of excessive water transporta­ tion in the collection and transportation of copra from producing areas to primary bodegas is a contributing factor to the following effects:

a. Dependence of the small copra producer on a single market or buyer. The vessel calling at a shipping point or small port along the coast is the only market.

b. Increased handling in copra shipments.

c. High cost of operations due to scale of shipments and excessive distance of the hauls to primary bodegas.

d. Lessened development of outpcrts.

e. With the lessened development of outports the quantities of shipments from primary bodegas to ports of transshipment are. increased or conversely, the direct shipments from outports to offshore ships are decreased.

10. The major need for improvement in transportation to alleviate this problem is improvement and new construction of roads. This would tend to achieve (but not necessarily achieve) the following:

a. Increased use of trucks in the collection and transporta­ tion of copra to primary bodegas. (Some water transport would be used, however, for a considerable period.)

b. Increased market alternatives to the copra producer.

c. Substitution of a lower cost transportation facility; truck vs. ship.

d. Decreased number of handling operations of copra.

152 e. A greater development of secondary ports.

f. To the extent major outlying ports were further developed, the percentage of shipments to major ports for transshipment to offshore vessels would be decreased.

g. Allow for the development of more alternatives in respect to secondary markets.

h. Aid in the development of secondary ports of sufficient size to achieve economies in handling other export and import commodities.

i. Decrease the need for improving numerous small ports.

11. In summary, the problem of excessive use of water transport is in the collection and transporting of copra from numerous shipping points to primary bodegas. The alternatives are: (1) the possibility of truck movement competing with water transportation for the movement of copra to primary bodegas, and (2) the further development of major outlying ports for increased shipments directly to offshore vessels.

12. The problem of excessive water transportation and the attendant need for road improvement and construction in relation to copra move­ ments varies widely between regions.

Region III

In the eastern Visayas, northern and eastern Mindanao, the problem of excessive use of water transportation is most serious and the need for road improvement based on copra movement is the greatest of any of the six copra regions. This is indicated by the following:

a. The method of shipping the large quantities of copra to Cebu for transshipment. At least 91 shipping points and ports 'within the region itself ship copra to Cebu.

b. The indication of excess handling in the shipments to Cebu because of numerous transshipments.

c. The poor condition of roads along the major coastal areas-­ western-and southern Leyte, northern and eastern Mindanao,. Samar, and .Masbate-wresults in a significant proportion of the copra being shipped to the 10 outlying ports -in vessels rather than by truck.

153 d. The anticipated increase in importance of this copra pro­ ducing region in absolute volume and percentage of total volume of copra which will be exported from ports in this region over the period 1957-1966. This will tend to increase the effects of the problem.

Within the region the problem and the priority for need varies also. Of course, no priority can be assigned on the basis of copra movement alone. The following observations point to the relative needs in this region:

1. Improvement of the roads along the northern coast of Mindanao connecting the ports of Surigao, Nasipit, Cagayan de Oro and Iligan.

2. Improvement and construction of the road along the western coast of Leyte from Ormoc south to Baybay south to Maasin, Malitbog, Sogod and Hinunangan.

3. Improvement and construction of the roads on Samar along the northern, eastern and southern coasts.

4. Improvement and construction of the roads on Masbate, the Camotes and other small islands.

5. Bohol and Cebu roads are in relatively good condition in respect to copra movements.

Region V and Region VI

In the Davao area and western Mindanao there is also a problem of excessive water transportation, but it is not as serious as in Region III.

In Davao, the greatest percentage of the shipment of copra to Davao City originated in small ports along the coast of the province. The road from Davao City services only a small segment of the producing area along the coast. Therefore, there are no alternatives to the pro­ ducers of copra. Road improvement would aid the marketing process of copra within the province.

In Region V, there is lack of roads connecting Zamboanga del Norte and Zamboanga del Sur with Zamboanga City. If the road between Pagadian and Zamboanga City were completed, it would facilitate the flow of copra to Zamboanga City. However, the road between Pagadian and Iligan is

154 presently being used to transport copra from Zamboanga del Sur to Iligan. Thereby the need for a road to Zamboanga City in relation to copra move­ ments is lessened.

In respect to the shipments from Cotabato province, the improvement and construction of a road would principally facilitate the movement of copra from producing areas to primary bodegas. The shipments to Zamboanga City for transshipment would probably continue to be trans­ ported by vessels.

On Basilan Island a road would tend to improve the movement of copra to the primary concentration bodegas, but would not alter the pattern of transshipments.

On the Island of Jolo, the road presently services most of the island. The problem is principally feeder roads to the principal roads. Probably little change would occur in the present pattern of copra movements.

Regions I, II and IV

In these regions with the possible exception of Negros Oriental, there are relatively minor problems of transporting copra especially in comparison to Region III.

In Region I, copra is shipped directly to offshore vessels from ports in the producing provinces or is shipped to coconut oil mills. The exports of copra from the port of Manila originate in nearby prov­ inces and do not constitute excessive movement of copra for transship­ ment. The principal problem to the extent that a problem does exist is in the movement of copra from producing areas to primary bodegas. Access roads would facilitate the process. This is especially the case on the islands of Mindoro, Palawan, Marinduque and Romblon. On the Island of Luzon, Quezon province is in greatest need of access roads to producing areas.

In Region II, the Bicol area, there are some copra producing areas which would benefit with improvement and construction of access roads but these do not constitute a large segment of the region. Improvement of the roads in Camarines Sur would probably increase the use of truck for the movement of copra to Legaspi and Tabaco. The major effect would probably be to decrease the use of rail transport rather than to alter any existing copra flows.

In Region IV, the major need in relation to copra movement is for roads in Negros Oriental from Dumaguete to copra producing areas. 155 Appendix IV-A

PREVIOUS PAGE BLANK Appendix IV-A

EXPLANATION AND SOURCES OF TABLE IV-II

1. Column 1 Total Exports of Copra Source: Associated Steamship, Consolidated Statistics of Cargo Movements from the Philippines. From Ist January to 31st December, 1955.

2. Column la: Quantity Shipped Directly Offshore from Ports Located in Producing Province Explanation: In cases where quantity of exports from ports located in province of production were less than total produc­ tion of province, all exports were classified as direct offshore shipment. For example, ports in Quezon province exported a total of 69,300 metric tons in 1955, (See Column 1). Production of Quezon province has been adjusted to 163,700 metric tons. Therefore, direct offshore shipments from Quezon province were 69,300 metric tons. Sources: Associated Steamship, op. cit.; DANR, Division of Agricultural Economics; Stanford Research Institute.

3. Column lb: Quantity Received at Major Ports for Transshipments Explanation: In cases where exports from ports located in producing provinces were more than total production, the dif­ ference between total exports and the production of the province was estimated to be the quantity of copra received at the port for transshipment to offshore vessels. For example, the ports of Legaspi and Tabaco in Albay province exported a total of 92,500 metric tons in 1955, (See Column 1). Production of Albay province was estimated at 32,800. Therefore, the ports of Legaspi and Tabaco in Albay province received a total of 59,700 metric tons for transshipment. Sources: Associated Steamship, op. cit.; DANR, Division of Agricultural Economics; Stanford Research Institute.

4. Column 2: Total Copra Received at Copra Oil Mills Column 2a plus 2b. OUE BLANK 5. Column 2a: Coconut Oil Exported (Copra Equivalent) Total coconut oil exports converted from long tons to metric tons. Copra equivalent derived by dividing coconut oil by 0.63. Sources: Associated Steamship, op. cit.

6. Column 2b: Total copra cakes and meal exports converted from long tons to metric tons. Ten percent added for local use. Copra cakes and meal comprise about 37 percent of total copra processed into coconut oil. Dividing by .37 resultant figure equals copra equivalent of total coconut oil produced. Subtract copra equivalent of coconut oil exports, resultant figure equals amount of copra equivalent of coconut oil produced for domestic market. Sources: Associated Steamship, op. cit.

7. Column 3: TrLal Copra, Copra and Copra Equivalent of Coconut Oil Columns 1 plus 2.

8. Column 4: Total Copra Received by Major Ports and Coconut Oil Mills Columns lb plus 2.

9. Column 4a: Total from Provinces within Region Explanation: These estimates were based on the following analysis. Region I. Shipments to Manila: The study by Dr. Frederick Wernstedt of the manifests of interisland shipments to Manila indicated ports of origin for water shipments of copra to Manila. Al­ though his data were based on manifests covering the period October 1953, May-June 1954, they have been adjusted and have been estimated to total 35,000 metric tons for the total copra shipments from all ports shipping copra to Manila by water transport. The distribution of these 35,000 metric tons to the various provinces was made according to the data of Dr. Wernstedt's study. Thus, for example, 2,000 metric tons were shipped from Marinduque; 2,000 metric tons were shipped from Davao; 600 metric tons from Cebu; etc.

11 anl From columns la and 2 it was estimated that a total of 206,300 metric tons of copra was received at Manila and environs for export and processing at coconut oil mills. Therefore, since 35,000 metric tons were re­ ceived by water transport a total of 170,300 metric tons must have been shipped in by truck and rail trans­ port. The four provinces which could supply mills with copra by land transport are Batangas, Cavite, Laguna, and Quezon provinces. Thus the 171,300 metric tons originated in these four provinces.

To determine the amount of copra from each of these four provinces the following procedure was followed.

a. Production figures were taken for each of the provinces as shown in Table IV-I, (the DANR, Division of Agricultural Economics estimates).

b. Exports from ports within the provinces were deducted, i.e., 69,300 metric tons werededucted from total of Quezon province.

c. The resultant total copra available for shipment from these four provinces was then calculated.

d. The percentage from each province was then cal­ culated, i.e., 10.3 percent from Batangas, 3.1 from Cavite, 31.4 percent from Laguna and 55.2 percent from Quezon province.

e. The total of 171,300 metric tons was then sub­ stituted for the total copra from the four provinces as estimated by the DAE.

f. The percent available from each of the four provinces was then applied against this new total. g. Thus, 17,600 metric tons came from Batangas, 5,300 metric tons from Cavite, 53,800 metric tons fromi Laguna and 94,600 metric tons from Quezon province.

161 Region II. Bicol Region: The data from Dr. Wernstedt's study showed that only an insignificant amount of copra was shipped to Tabaco and Legaspi from outside the region. Therefore, the total production of this region was equal to total exports, i.e., 123,000 metric tons. The percentages of total production of this region for each province as estimated by the DAE were applied to the total of 123,000 metric tons. The estimated production of provinces in the region was then adjusted upward.

Region III. Eastern Visayas-Northern Mindanao: These estimates are the most reliable of all regions. They are derived from a special study conducted for Stanford Research Institute on the number and port of origin of copra sacks entering Cebu. By multiplying the number of sacks by 59 kilograms, the total copra estimated in this study, i.e. 238,500 metric tons, was for all practical purposes duplicated. These totals are the percentages of sacks entering Cebu taken from a special study conducted for Stanford Research Institute.

Region IV. Western Visayas: Shipments into Iloilo and Dumaguete are very rough estimates. Dr. Wernstedt's study showed the largest shipments from New Washington, Capiz. Hovwever, the total adjusted tonnage was far below the required amount to equal 13,000 metric tons. Therefore, Antique estimates are DAE production. One thousand metric tons were estimated for Negros Occidental, (200 for Misamis Oriental was indicated by Dr. Wernstedt's study and 7,800 metric tons for Capiz is a combination of production estimates by DAE and the residual to make 13,000 metric tons.

No data were available on shipments to Dumaguete. Therefore, 50 percent was assigned to Negros Occidental and 50 percent to northern Mindanao provinces.

162 Region V. Western Mindanao: Dr. Wernstedt's study indicates that Davao was the only province which shipped copra to Zamboanga City from outside the region. Estimates were made on the percentage originating in provinces within the region. The estimates of this region as well as the Davao region, include some tonnage from the producing provinces in which the port is located.

Region VI. Southern Mindanao: There were no shipments indicated from outside the region. The remaining explanation for this region is the same as for Region V.

163 SUGAR AND SUGAR PRODUCTS

PREVIOUS PAGE 8 NK Sugar and Sugar Products

The area planted to sugar cane in 1955 was 267,000 hectares representing about 4 percent of the total area planted to all crops. The total quantity of sugar cane grown was about 12,000,000 metric tons which yielded approximately 1,230,000 metric tons of centrifugal and muscovado sugar, combined.

Centrifugal sugar comprised more than 95 percent of total sugar production. Total centrifugal sugar allotments including nonoperating mills for the crop year 1954-1955 were 1,167,780 metric tons.1' Of the total centrifugal quota, 74 percent (863,654 metric tons) was exported to the United States alone, and an additional 2 percent (22,500 metric tons) was shipped to world markets. Therefore, the movement of sugar cane to centrals, and the shipment of centrifugal sugar to ports of export from the central, constitute the greatest bulk of the demand for transportation generated by sugar movements in the Philippines.2/ However, the domestic quota of centrifugal sugar also represents an important demand on transportation facilities, especially in relation to the movement of all agricultural commodities. A total of 281,625 metric tons or 24 percent of total centrifugal sugar was alloted to domestic consumption. Of this total approximately 100,000 metric tons were re­ fined; the remainder being distributed as washed or brown sugar.

In addition to centrifugal sugar, an estimated 60,000 metric tons of muscovado and panocha sugar were produced in 1955.3/ Most of the production was distributed in local markets and constituted only a minor demand for transportation. Exports amounted to only 3,181 metric tons in the calendar year 1955.

1/ Quota allotments to mill districts have been used rather than actual production figures for the year 1954-1955. Since the full quota has been met in recent years, allotments represent annual average production of mill districts. Net reserves have not been included in the total allotments. 2/ Included in these exports were 8,800 metric tons of refined sugar exported to the United States and 500 metric tons to Hongkong. 3/ Department of Agriculture and Natural Resources, Division of Agri­ cultural Economics.

167 Molasses represents the most important by-product of centrifugal sugar production. Total production in 1954-1955 was 332,700 metric tons of which about 92 percent (305,200 metric tons) was exported; 22,500 were used by alcohol distilleries; and about 5,000 metric tons were used as animal feeds.i2

Methods of Marketing Sugar

Sugar cane production is determined by the quotas allocated by the Sugar Quota Administration to the sugar planters in each mill district.

The sugar cane is moved from the fields by transportation facilities provided or contracted for the centrals. Shortly before the start of the milling season the planter is informed by the mill when the sugar cane will be collected. The cane is cut by the planter and loaded on to rail cars or trucks supplied by the mill. Where the cane is in­ accessible to truck or rail facilities, the cane is hauled by the planter to a loading point. Where the cane must be transported 10 kilometers or over, the central pays the cost of transport.

The majority of mills own and operate railroads to bring the cane to the central. These shipments by rail are supplemented in some cases by truck transport. On Luzon, a number of mills utilize the Manila Railroad for hauling cane to the central; and on Panay, the Asturias Sugar Central, Inc., uses the Philippine Railway for the same purpose.

After the cane is milled, the centrifugal sugar is bagged and stored in bodegas usually located at the central site. In a few in­ stances, the sugar is shipped by the mills to bodegas located at the port of export, or at a distribution point for domestic consumption.

The bagged centrifugal sugar is moved from the bodegas by rail, truck, and barge to ports of export;.Y to refineries at Victorias, Negros Occidental or Insular Sugar Refinery at Mandaluyong, Rizal, or

1/ Estimates of Luzon Stevedoring Co., Manila. 2/ The transportation facilities employed to moje centrifugal sugar from centrals to ports of export are discussed in Volume III, Water Transportation.

168 to distributors for sale on the local market as washed or brown sugar.1 / From the refineries, the refined sugar is transported either to market by the distributors by truck, rail, and barge; or directly to large consumers by barge.

Methods of Marketing Molasses

Molasses is produced as a by-product of centrifugal sugar production and is usually stored in tanks at the centrals. From the mills, molasses is shipped to ports of export, distributed by dealers to the domestic market: for use as animal feeds, or to distilleries for the manufacture of alcohol.

In the Visayan area, the molasses destined for export is transported by the centrals to barges which then lighter the molasses to offshore vessels. At San Carlos and Bais, the molasses is transferred directly from the pier site to offshore ships. Tank cars or Navy cubes on rail flat cars or trucks are used to transport the molasses.

On Luzon, molasses for export is transported from centrals by the Manila Railroad or by truck trailer to collection tanks of the Luzon Stevedoring Co. at Guagua, Pampanga or North Harbor, Manila. The molasses from Pampanga Sugar Mills, Inc., Pampanga Sugar Development Co., Inc., Central Azucarera de Tarlac, and Paniqui Sugar Mills, Inc. is shipped to Guagua, Pampanga; Canlubang Sugar Estate and Central Azucarera Don Pedro supply the North Harbor tank from which the molasses is barged to offshore vessels.

The molasses destined for the domestic market is transported from centrals by truck tank trailers to tank sites of molasses dealers.Y From the tank sites, the molasses is distributed by truck to the domestic market for use as animal feed.

1/ The centrals process centrifugal sugar to washed sugar. 2/ Molasses dealers (excluding Luzon Stevedoring Co.): Go Piao, San Fernando, Pampanga; Ayala Molasses, Manila; and Central Luzon, Polo, Bulacan.

169 LIST OF SUGAR CENTRALS (shown on FIG. IV-13)

LUZON 0 Central Azucarera del Norte 0 Hind Sugar Company Paniqui Sugar Mills, Inc. Central Azucarera de Tarlac Pampanga Sugar Mills 0 Pampanga Sugar Development Co. © Canlubang Sugar Estate © Central Azucarera Don Pedro

MINDORO @ Philippine Milling Company

WEST VISAYAS

Panay Asturias Sugar Central Inc. 0 Central Azucarera de Pilar © Central Santos-Lopez Co. Inc.

Negros Occidental 0 Victorias Milling Co. Inc. Hawaiian-Philippine Company 0 Talisay-Silay Milling Co. Inc. Bacolod-Murcia Milling Co. Inc. 0 Central Azucarera de la Carlota Binabalgan-Isabela Sugar Co. Inc. 0 Ma-ao Sugar Central Co. Inc. 0 Lopez Sugar Central Mill Co. Inc. © Central Azucarera del Danao 0 San Carlos Milling Co., Ltd.

Negros Oriental Central Azucarera de Bais

EAST VISAYAS

Leyte ® Ormoc Sugar Company, Inc.

Cebu Bogo-Medellin Milling Co.

170 p

C

a

p

FIG. IV-13 LOCATION OF SUGAR CENTRALS 1955

171 The molasses used by distilleries requires little transportation. Except for the plant at Calumpit, Bulacan, distilleries are located at the centrals. Calumpit receives molasses by truck from various tank sites of molasses dealers.

Alcohol is used principally as fuel by centrals and on sugar cane farms.

Origin and Destination of Sugar Cane - Crop Year 1954-1955

Ninety-five percent of the sugar cane was transported to the 25 sugar centrals for milling into centrifugal sugar. Figure IV-13 shows the location of the 25 centrals. The sugar cane milled in centrals during the crop year 1954-1955 was grown in adjacent areas to the centrals.

As shown in Table IV-IV total gross cane ground by the centrals was 11,348,800 metric tons. A significant transportation demand was generated by the movement of cane to centrals. The greatest bulk is transported by privately-owned narrow gauge railroads. However, sugar cane represents an important segment of the total freight carried by the northern lines of the Manila Railroad and particularly the freight movelents of the Philippine Railway. (See Volume V, Land Transportation- Railroads.)

Sugar cane used in the manufacture of muscovado sugar and panochas was grown throughout the sugar areas adjacent to the centrals shown on Figure IV-14. Probably as much as 600,000 metric tons of cane were required to yield the estimated 60,000 metric tons of muscovado and panocha produced in 1955. Although the total cane used represents a sizeable tonnage in the aggregate, it was transported to muscovado mills in small unit, short-haul loads principally by carabao cart. In the case of panocha, there is practically no movement of sugar cane required.

172 Table IV-IV

ESTIMATED GROSS CANE GROUND, BY PROVINCE PHILIPPINES Crop Year 1954-1955

PROVINCE Metric Tons

PHILIPPINES 11,548,900

LUZON

Ilocos Sur 19,600 Pangasinan 66,200 Pampanga 1,333,200 Tarlac 760,800 Batangas 545,700 Laguna 451,700 Mindoro 46,100

VISAYAS

Capiz 504,200 Iloilo 193,600 Negros Occidental 6,436,000 Negros Oriental 579,600

Cebu 230,100 Leyte 182,000

Source: Annual Reports of the Philippine Sugar Association for the Fiscal Period November 1, 1954 to October 31, 1955, Manila, 1955.

173 Origin and Destination of Centrifugal Sugar - Crop Year 1954-1955

Table IV-V and Figure IV-14 show the distribution of sugar allot­ ments, by region and province. Negros Occidental is the leading producing province with a total production comprising 57 percent of the total centrifugal sugar of the Philippines, while the Visayas as a whole produced 70.5 percent of the sugar. Sugar production on Luzon, which constituted 30 percent of the total production, was concentrated in the central Luzon region with Pampanga the leading producing province.

As shown on Table IV-VI, from these centrals 74 percent or 863,654 metric tons were exported to the United States and 22,500 metric tons or 2 percent weroe shipped to world markets. The method of moving sugar from the centrals to ports of export is discussed in detail in the section in Water Transport. The remaining 281,625 metric tons or 24 percent were allocated to domestic market.

Of the total allotments to the domestic market approximately 180,000 metric tons were distributed through sugar dealers as washed and brown sugar. The dealers transported the bagged washed or brown sugar from the centrals in trucks, or by rail and barge.

The remaining approximately 100,000 metric tons of centrifugal sugar was shipped to either Victorias Milling Co. at Victorias, Negros Occidental or to Insular Sugar Refinery at Mandaluyong, Rizal. About 75,800 metric tons of centrifugal sugar were refined by Victorias Mill­ ing Co. for the domestic market during 1954-1955.1/ Assuming Victorias used all of its domestic quota of approximately 30,000 metric tons for refining, then 45,000 metric tons of centrifugal sugar were transported by barge and truck to Victorias from centrals located in Iloilo and Negros.2/ The total refined sugar produced by Victorias Milling Co. for the domestic market was 70,623 metric tons during 1955. As shown on Table IV-VII, most of the refined sugar was shipped to dealers in Manila, with significant movements directly to large consumers. The allocations to planters were sold to dealers.

1/ This is based on an assumption that 1 picul of centrifugal sugar yields 130 pounds of refined sugar. 2/ There were some exchanges of export allotments between Victorias Milling Co. and other centrals which would lower the amount of centrifugal sugar shipped to Victorias for refining.

174 -Legend­ (moric tons) 100,000

60,000

20,000 0

0

0:

FIG. IV-14 TOTAL CENTRIFUGAL SUGAR ALLOTMENTS CROP-YEAR 1954-1955

175 Table IV-V

CENTRIFUGAL SUGAR ALLOTMENTS 1954-1955 Crop

Percent Percent of Total of Total Region & Province Piculs Metric Tons By Regioni By Province

PHILIPPINES 18,462,925 1,167,780 100.0 100.0

LUZON:

Il6cos Regiont 30,976 1,959 .2 Ilocos Sur 30,976 1,959 .2

Central Luzon: 3,577,496 226,277 19.4 Pangasinan 105,133 6,650 .6 Pampanga 2,208,320 139,676 12.0 Tarlac 1,264,043 79,951 6.9

Southern Tagalogr 1,805,689 114,210 9.8 Laguna 879,004 55,597, 48 Batagas 851,940 53,885 4.6 Mindoro 74,745 4,728 .4

VISAYAS:

Western Visayas: 12,463,688 788,328 67.5 Capiz 809,671 51,205 4.4 Iloilo 359,575 22,743 2.0 Negros Oriental 811s901 51,353 4.4 Negros Occidental 10,482,641 663,027 56.8

Eastern Visayas: 660,327 35,441 3.0 Cebu 307,223 19,432 1.7 Leyte 253,105 16,009 1.4

Non-Operating Mills 24,749 1,565

1/ Allocated to various operating mill districts. 2 Less than 1.J pIxexnt. Source: Domestic Division, Sugar Quota Administration

173 Table IV-VI

QUANTITY OF CENTRIFUGAL SUGAR EXPORTED TO THE UNITED STATES, TO WORLD MARKETS AND ALLOCATED TO THE DOMESTIC MARKETS, BY REGION AND PROVINCE (Metric Tons)

Quanity Crop Year Allocated 1954-19551/ To United To World To Domestic Total States Markets Markets Allotments

Philippines 863,654 22,500 281,625 1,167,780 Percent of Total 74.0% 2.0% 24.0% 100.0%

Luzon 257,921 6,405 78,120 Ilocos Region 332 64 1,563 Ilocos Sur 332 64 1,563

Central Luzon 170,419 4,126 51,732 Pangasinan 1,576 375 4,698 Pampanga 109,164 2,258 28,255 Tarlac 59,679 1,493 18,779

Southern Tagalog 87,170 2,215 24,825 Batangas 39,713 1,274 12,898 Laguna 42,883 941 11,773 Mindoro 4,574 -- 154

Visayas 605,675 15,984 202,112

Western Visayas 583,848 14,944 189,537 Capiz 38,240 867 12,098 Iloilo 15,886 507 6,350 Negros Occidental 491,555 12,651 158,823 Negros Oriental 38,167 919 12,266 Eastern Visayas 21,827 1,040 12,575 Cebu 13,802 417 5,214 Leyte 8,025 623 7,361 Non Operating Mills.?/ 58 111 1,394

1/ Allotments for Crop Year 1954-1955. 2/ Distributed to various operating mills.

Source: Domestic Division, Philippine Sugar Quota Administration.

177 Table IV-VII

DISTRIBUTION OF REFINED SUGAR FROM VICTORIAS MILLING COMPANY, INC. 1954-1955

Deliveries to Dealers: Metric Tons

Manila 37,733

Cebu 5,705

Iloilo 6,744

Total 50,183

Deliveries to Consumers:

Manila 9,322

Bacolod 953

Gebu 1,154

Iloilo 1,471

Davao 953

Bugo, Mindanao 1,701

Other 1,976,

Total 17.510

Deliveries to Planters 2/ 2,930

Total to all buyers 70,623

1/ From Victorias Bodega belonging to planters. 2/ Sold to dealers.

Source: Victorias Milling Company, Inc., July 6, 1956.

178 Insular Sugar Refinery received a total of 31,100 metric tons of centrifugal sugar during 1954-1955. Centrals on Luzon shipped 25,762 metric tons principally by Manila Railroad to Insular Refinery, while the remaining 5,340 was shipped by barge from the Visayas.

Most of the 29,333 metric tons of refined sugar was distributed through dealers located in Manila, the remaining was shipped to dealers in the Visayas located principally in Iloilo and Cebu.

The distribution of the refined, washed and brown sugar totaling approximately 280,000 metric tons from dealers to final consumers also generated significant demand for transportation. This pattern of distribution is discussed later in the section on trade areas in this volume.

Origin and Destination of Molasses

Table IV-VIII sets forth the production of molasses by province and central for the crop year 1954-1955. Of this total 305,200 metric tons or 91.7 percent was exported. Table IV-IX shows the ports of export and the tonnages.

The movement of molasses from centrals to ports of export in the Visayas is by barge. Iloilo is the principal export port. On the Island of Luzon most of the molasses for export moved from mills to the tank at Guagua, Pampanga by tank trailers. The following tabulation shows the tonnage and transportation facilities employed by Luzon Stevedoring Company during 1954-1955.

Molasses Shipped by Lusteveco, on Luzon 1955 (Metric Ton)

Rail Cars Tank Trailers

From mills to Guagua - 42,500 From mills to Manila 1,600 6,800

Source: Luzon Stevedoring Company,.Manila.

179 Table IV-VIII

MOLASSES PRODUCTION BY PROVINCE AND CENTRAL Crop Year 1954-1955

Province and Central Metric Tons

Philippines 332,700

Ilocos Region

Ilocos Sur 700 Central del Norte 700

Central Luzon

Pangasinan 2,100 Hind Sugar Co. 2,100 Pampanga 48,400 Pampanga Sugar Mills 21,900 Pampanga Sugar Dev. Co. 26,500 Tarlac 25,800 Paniqui Sugar Mills 3,700 Central Tarlac 22,100

Southern Tagalog

Laguna 11,100 Canlubang Sugar Estate 11,100 Batangas 20,300 Central Don Pedro 20,300 Mindoro 1,300 Philippine Milling Co. 1,300

Western Visayas

Capiz 14,300 Astorias Sugar Central 5,600 Central de Pilar 8,700 Iloilo 5,300 Central Santos-Lopez Co. 5,300 Negros Oriental 21,000 Central de Bais 21,000 Negros Occidental 169,500 Bacolod-Marcia 14,700 Binalbagan-Isabela 36,500 Central del Danao 5,000 Hawaiian-Phil. 14,100 Central de la Carlota 22,300

180 Table IV-VIII (Continued)

Province and Central Metric Tons

Lopez Sugar Central 8,300 Maao-Sugar Central 12,100 San Carlos Milling Co. 11,500 Talisay-Silay Milling Co. 13,800 Victorias Milling Co. 31,100

Eastern Visayas

Cebu 6,500 Bogo-Medellin Milling Co. 6,500 Leyte 6,500 Ormoc-Sugar Co. 6,500

Source: Luzon Stevedoring Co., Manila. Table IV-IX

EXPORTS OF MOLASSES, BY PORT 1955

Port Metric Tons

Manila 55,115

Iloilo 188,660

Inanduluga.ri 6,556

Bais 14,158

Hinigaran 12,469

Victorias 12,193

San Carlos 11,660

Pulupandan 2,406

Nadulaoa 1,930

Cobu 30

Total 305,178

L

Source: Associated Steamship Lines, Consolidated Statistics of Cargo Movements from the Philippines, 1st January to 31st December, 1955.

182 Most of the remaining 27,500 metric tons was used by distilleries and constituted only a minor demand for transportation. The molasses distributed as animal feed was transported in tank trailers.

Future Developments in Sugar and Molasses

Increases in total production of sugar will depend upon increased domestic consumption of sugar assuming no change in sugar quotas to the United States and world markets. The total consumption of centrifugal and refined sugar during 1955 has been estimated at approximately 255,000 metric tons.1/ Over the past five years per capita consumption of all sugars (muscovado, panocha, centrifugal and refined) has been estimated at 13.21 kilograms, or 29.13 pounds per person.2 On the assumption per capita consumption of all sugar remains the same over the next decade, total sugar consumption would approximate 325,000 metric tons in 1961 and 355,000 metric tons in 1966. Deducting the 1951-1955 five year annual average of 37,000 metric tons for muscovado and panocha, total consumption of refined, centrifugal and washed sugar would be 288,000 metric tons in 1961 and 318,000 metric tons in 1966.

Mr. Anunciacion has projected consumption estimates on the basis of an increased per capita consumption. The range for 1961 is 307,600 metric tons to 375,000 metric tons and for 1966 from 357,000 metric tons to 516,300 metric tons. These estimates are admittedly optimistic. However, it is probably a reasonable estimate to assume a total con­ sumption of 300,000 metric tons centrifugal and refined sugar for 1961 and 350,000 metric tons for 1966. The increased rate of increase between 1961 and 1966 is based on the anticipated increases in National Income.

With these assumptions in respect to the total production, no shift in production and distribution patterns is anticipated over the next decade.

1/ Casiano Anunciacion, "Our Sugar Consumption Potentialities," Sugar News, Vol, 32, No. 3. March 1956, p. 127. 2/ Ibid.

183 Molasses production is closely related to sugar production. There­ fore, although some relative increases in molasses over sugar may occur due to the possible production of "A" molasses, no significant shift in production and distribution patterns of molasses is anticipated between 1957-1966.

Transportation Needs and Improvements in the Movement of Sugar and Sugar Products

Transportation needs are presently met by private carriers, by the Philippine Railway, the Manila Railroad and barge operations. The anticipated increases in production do not constitute any new requiremer which will not be met by the present carriers. In some cases the roads leading to centrals could be improved to facilitate the movement of sugar cane by truck to the mills. However, relative to other trans­ portation problems in the Philippines, this constitutes a secondary problem.

The key problem of the sugar industry is bulk-handling of sugar for export. The analysis of present methods of handling and recom­ mendations for bulk handling are discussed in detail in the section on ports in Volume III, Domestic Water Transportation and Ports.

184 FIBERS: ABACA, RAMIE, AND MAGUEY Fibers: Abaca, Ramie, and Maguey

In 1955 the combined area planted to abaca (Manila hemp),ramie, and maguey, was 222,800 hectares which comprised 3.5 percent of the total area planted to all crops.- Total production of these fibers as shown on Table IV-X probably did not exceed 121,000 metric tons.

Of the three fibers, abaca is by far the most important. In 1955, 217,000 hectares were planted to abaca and total production approximated 119,000 metric tons. The bulk of abaca is exported as fiber to be manufactured into cordage. About 109,000 metric tons of unmanufactured abaca was exported in 1955. The shipments of abaca fiber from producing areas, to baling centers and then to ports of exports constitute most of the demand for transportation generated by the movement of fibers and fiber products within the Philippines. The greatest percentage of the remaining abaca is shipped to the two domestic manufacturers of cordage in Manila. These firms exported in 1955 about 50 percent of their combined production of about 10,000 metric tons. In addition probably 2,000 metric tons were used in hemp rugs, miscellaneous abaca products for export and for local uses and home-made rope.

Ramie production, for all practical purposes located in southern Mindanao, was approximately 1,300 metric tons and was produced on about 2,900 hectares. Maguey production which was centered in Cebu was no more than 200 metric tons. It is apparent transportation requirements were small for the movement of these fibers.

Methods of Marketing Abaca

Abaca is most commonly grown on small farms of 2 to 3 hectares. In the Davao area before World War II there were extensive abaca plantations of over 1,000 hectares owned and operated by Japanese. However, the small abaca farm is most representative in this region

1/ See Table IV-C-I, Appendix IV-C at the end of the discussion on fibers. PREVOU PAGE B1AR

187 Table IV-X

FIBERS: TOTAL PRODUCTION OF ABACA, RAMIE AND MAGUEY, BY PRODUCTS, 1955

Fiber Product Metric Tons

Abaca Unmanufactured Abaca 107,050 Cordage, Twine 10, C100 Hemp Rugs and Miscellaneous 1,850

Total Abaca Fiber 118,900

Ramie Unmanufactured Ramie 1,300

Total Ramie Fiber 1,300

Maguey Unmanufactured Maguey 200

Total Maguey Fiber 200

Total Production of Abaca, Ramie and Maguey 120,400

Sources: Department of Agriculture and Natural Resources, Fiber Inspection Service, Annual Baling Report, 1955.

Department of Agriculture and Natural Resources, Fiber Inspection Service, Monthly Abaca Balings by Province (Special Report prepared for the Transporta­ tion Survey of the National Economic Council), 1956.

Associated Steamship Lines, Consolidated Statistics of Cargo Movements from the Philippines, from the 1st of January to the 31st of December, 1955.

Elizalde & Co., Manila, P. I.

Manila Cordage Company, Manila, P. I.

Stanford Research Institute.

188 at present. There are two privately operated plantations utilizing decorticating machinery of the Corona type which are between 850 and 1,000 hectares.-/

The method of harvesting abaca varies as to the type of stripping operation used. Where abaca is stripped by the spindle machine or by simple hand stripping, tuxies are made by removing ribbons from the outer portion of the sheaths that make up the abaca stalk. Where decorticating machines are employed the abaca stalk is cut into four foot lengths and shipped to the decorticating location.

In the Davao area where the spindle machine or hagotan is most commonly used, tuxies are grouped and rolled into bundles and hand carried to the machines.

In the case of the decorticating stripping process which is used only in the Davao area, the four foot length of stalks are transported to the decorticating plants from an area as large as 1,000 hectares by narrow gauge railroads.

In the Bicol region and other areas outside of Davao, handstripping is typical and tuxies are simply hand carried to the stripping location, directly from the fields.

After the fiber is produced by stripping, it is hung in the sun to dry and tied into bundles. These bundles are then carried to small merchants or collection points, for hand or small scale spindle machine stripping. From these points, or from the large- stripping machines directly, the bundles are collected by truck and shipped to baling centers. The movement of loose abaca fiber to baling centers involves transfers to small boats in a number of areas and in a few instances

1/ Thomas Jeff Davis, Report to the Government of the Philippines on Economic Policies for Abaca, Rome, July 1956, p. 12. The Institute is indebted to Dr. Davis for his suggestions and the early and liberal use of his report for the study. In particular, the section on future trends of abaca has been extensively used. Any errors which may appear in this study are, of course, solely the responsi­ bility of the author.

189 to rail transport. See Appendix IV-C for a list of baling firms and their locations. (Table IV-C-II).

Loose bundles of unbaled abaca are shipped directly by interisland ships to the two rope and twine manufacturing firms, Elizalde and Co., and Manila Cordage Co., both of which are located in Manila. Manu­ facturers of hemp rugs and miscellaneous abaca products, principally located in Albay province, also purchase abaca in loose bundles of fiber. These comprise small unit loads.

From the baling locations abaca is most commonly shipped by inter­ island ships to Manila as in-transit shipments to offshore vessels. A much lesser quantity of baled abaca fiber is moved directly to off­ shore vessels from baling locations and some is shipped through Cebu as in-transit shipments.

Origin and Destination of Abaca Fiber, 1955

In 1955 abaca was grown in four regions in the Philippines as shown on Table IV-XI and Figure IV-15. The southern Mindanao region, principally Davao province, was the leading producing area. Forty-five percent of the total estimated production was grown in this area. The Bicol region was the second most important producing area with 23 per­ cent of total production' closely followed by the eastern Visayan­ northern and eastern Mindanao region with 22.6 percent of the total abaca production. The fourth region is Jolo which produced an estimated 8.7 percent of total production. Other areas including the western Visayas produced less than one percent of total abaca production in 1955.

The movement of abaca fiber from the four producing regions to destination points may be divided into three categories:

(1) The movement of loose abaca fiber to baling locations.

(2) The movement of loose abaca fiber in bundles to domestic manufacturers of rope and twine.

(3) The movement of baled abaca fiber to ports of exports.

190 REGION -Legend­ I SOUTHERN MINDANAO (metric tons) II BICOL 10,000 III EASTERN VISAYAS, NORTHERN AND 5,000 EASTERN MINDANAO 2,000 IV WESTERN MINDANAO I 0

0

FIG. IV-15 ESTIMATED TOTAL PRODUCTION OF ABACA FIBER BY REGION 1955

191 Table IV-XI

FIBERS: ESTIMATED TOTAL PRODUCTION OF ABACA FIBER BY REGION AND PROVINCE (Metric Tons)

Quantity of Abaca Fiber Produced Percent of Region and Province (metric tons) Total Production

Philippines 118,900 100,0%

Region I - Southern Mindanao 53,600 45.0

Davao 52,1001/ Cotabato 1,500

Region II - Bicol 27,400 23.1

Albay 8,0002/ Camarines Norte 300 Camarines Sur 4,800 Sorsogon 9,900 Catanduanes .4,5003/

Region III - Eastern Visayas - Northern & Eastern Mindanao 26,800 22.6

Samar 3,000 Leyte 10,000 Cebu 50 Northern Mindanao 4,900 Eastern Mindanao 8,800

Region IV - Western Mindanao 10,300 8.7 4/ Sulu 10,300­

Others 800 0.7

Capiz 10 Iloilo 4 Negros Oriental 240 Various 500

192 Table IV-XI (Continued)

Notes:

1/ Includes an estimate of 1,003.2 metric tons purchased by rope factories in Manila. 2/ Includes 1,892.5 metric tons of abaca used in the manufacture of hemp rugs exported. 3/ Includes 5.4 metric tons of abaca used in the manufacture of hemp rugs exported. 4/ Includes an estimate of 9,029.3 metric tons purchased by rope factories in Manila.

Sources:

Department of Agriculture and Natural Resources, Fiber Inspection Service, Annual Baling Report, 1955.

Department of Agriculture and Natural Resources, Fiber Inspection Service, Monthly Abaca Balings by Province (Special Report prepared for the Trans­ portation Survey of the National Economic Council), 1956.

Associated Steamship Lines, Consolidated Statistics of Cargo Movements from the Philippines, from the 1st of January to the 31st of December 1955.

Elizalde & Co., Manila, P. I.

Manila Cordage Company, Manila, P. I.

Stanford Research Institute.

193 During 1955, 90 percent or 107,000 metric tons moved to locations to be baled for export to world markets, while 12,000 metric tons were shipped to domestic manufacturing establishments, principally the rope plants located in Manila.

Movement of Loose Abaca Fiber in Bundles to Baling Locations, 1955

Table IV-XII sets forth the quantity of abaca baled in each province. In addition the quantities baled within the provinc of production, and the quantities shipped between provinces to baling locations are indicated in columns 3, through 5.

Most of the loose abaca moved to baling locations within the province of production. Eighty percent or 85,000 metric tons was trans­ ported by truck, rail, interisland vessel, banca, bus, or carabao cart, to baling centers. The remaining 20 percent or about 23,000 metric tons was shipped to other provinces for baling.

As shown on Table IV-XII Davao baling establishments baled the largest quantities of abaca, about 52 percent of the total abaca fiber baled in 1955. Most of the fiber originated in the province of Davao; it was shipped to baling establishments by truck, interisland vessels, and small boats. In addition Davao received about 1,500 metric tons from southern Cotabato and an estimated 3,200 metric tons from other provinces. Figure IV-16 shows the movement of abaca fiber to Davao by interisland vessels.

Most of the abaca grown in the Bicol provinces was baled within the region. About 2,200 metric tons moved between provinces within the region principally to Tabaco, Albay. Rail and truck facilities were used for these movements supplemented by interisland vessels. In addition 1,000 metric tons were shipped to Manila for baling. Figure IV-17 shows the movement of abaca fiber by interisland vessel into the baling locations at Legaspi, Tabaco.

In the eastern Visayas-northern Mindanao region the loose abaca was shipped to Leyte or Cebu for baling, and sizeable quantities (about 4,000 metric tons) were transported to baling firms in Manila. Cebu firms baled slightly more than 9,000 metric tons, most of which originated in provinces in northern and eastern Mindanao, while Leyte baled over 10,500 metric tons; all but 600 metric tons probably originated within the province. Only a small amount of abaca was baled within Samar, the excess loose fiber being shipped to Cebu or Manila for baling.

194 Table IV-XII

TOTAL QUANTITY OF ABACA FIBER BALED, BY REGION AND PROVINCE, 1955 (Showing Estimated Quantities of Loose Abaca Fiber Originating In Province of Baling Locations Shipped To Baling Locations In Other Provinces, and Received From Other Provinces For Baling.)

Quantity of Loose Abaca Fiber Total Quantity Originating in Shipped to Baling Received From of Abaca F iber Baled Province of Locations in Other Other Provinces Quantity Percent of Baling Location Provinces For Baling Region and Province (metric tons) Total Baled (metric tons) (metric tons) (metric tons)

0 Philippines 23,000

Manila 6,500 6.1 6,500

Region I - Southern Mindanao

Davao 55,800 51,100 4,700 Cotabato 1,500

Region II - Bicol 24,600 23.0

Albay 8,400 6,200 2,200 Camarines Norte 300 Camarines Sur 3,400 3,400 1,400 Sorsogon 9,800 9,800 100 Catanduanes 3,000 3,000 1,400 Table IV-XII (Continued)

Quantity of Loose Abaca Fiber Originating in Shipped to Baling Received From of Abaca Fiber Baled Province of Locations in Other Other Provinces Quantity Percent of Baling Location Provinces For Baling Region and Province (metric tons) Total Baled (metric tons) (metric tons) (metric tons)

Region III - Eastern Visayas - Northern and Eastern Mindanao 20,200 18.8

Samar 500 500 2,500 Leyte 10,600 10,000 600 Cebu 9,100 50 '-S 9,000 Northern Mindanao 5,000 Eastern Mindanao 8,800

Region IV - Western Mindanao

Jolo 1,300

Others

Capiz 11 Iloilo 4 Negros Oriental 240 Various 500

Sources: Department of Agriculture and Natural Resources, Fiber Inspect..on Service, Monthly Abaca Balings by Province, (Special Report prepared for Transportation Survey of the National Economic Council) 1956, Table III. Stanford Research Institute. SOURCE: Dr. Frederick Wernatedt.

FIG. IV-16 ABACA (MANILA HEMP) INTERISLAND SHIPPING INTO THE PORT OF DAVAO

197 SOURCE: Dr. Frederick Wernatedt.

FIG. IV-17 MONTHLY SHIPMENTS OF ABACA FIBER INTO THE PORTS OF TABACO AND LEGASPI

198 The loose fiber shipped to baling locations from Jolo as well as the small shipment from other region- went principally to Manila.

The Movement of Loose Abaca Fiber in Bundles to Domestic Manufacturers of Rope and Twine, 1955

According to representatives of Elizalde and Co., and Manila Cordage Co. practically all of the abaca used in their rope and twine manufacturing plants located in Manila, originated in southern Mindanao and in particular, the province of Jolo. Table IV-XIII shows the estimated quantities shipped from Jolo and Davao to Manila rope manu­ facturers during 1955. These shipments are made by interisland ships.

In addition close to 2,000 metric tons was purchased by hemp rug and miscellaneous abaca product fabricators. However, since most of these are located in Albay province there was only a small demand for transportation generated by these short haul, small-unit load movements, The export of rope, twine, hemp rugs, and miscellaneous products is shown in Table IV-C-III.

Origin and Destination of Baled Abaca Fiber to Export Ports, 1955

As shown on Table IV-XIV most of the abaca fiber moves from baling locations as in-transit shipments to be loaded on offshore vessels at Manila. Eighty-four percent of the total exports of baled abaca fiber moved from baling locations by interisland vessels to Manila. Ten per­ cent of the shipments were loaded directly on offshore vessels from baling locations and the remaining 6 percent were shipped through Cebu as in-transit shipments. Figure IV-18 shows the movement of baled abaca or Manila hemp to the Port of Manila.

Comparing the quantities baled by province with those exported from baling locations (Tables IV-XII and IV-XIV) most of the baled abaca is moved directly as in-transit shipment from baling locations to offshore vessels at Manila. However, a sizeable quantity of baled abaca apparently moves from Leyte to Cebu before it is moved to Manila as in-transit shipments.

ENATRI D/MI RARY COMMUNICAT1"S B~EEI DIVISION AiD/MANILA

199 SOURCE: Dr. Frederick Wernstedt.

FIG. IV-18 MONTHLY SHIPMENTS OF MANILA HEMP INTO THE PORT OF MANILA

200 Table IV-XIII

ESTIMATED QUANTITIES OF LOOSE ABACA FIBER SHIPPED TO DOMESTIC MANUFACTURERS BY REGION AND PRIVINCE 1955

Quantity Shipped to Quantity Shipped Hemp Rug and Misc. to Rope & Twine Abaca Products Mfrers. Region & Province Mfrers. In Manila in Albay Total (Metric Tons) (Metric Tons) (Metric Tons)

Philippines 10,000 1,800 11,900

I. Southern Mindanao Davao 1,000 II. Bicol

Albay 1,800 Catanduanes 5 III. Eastern Visayas

Northern and Eastern Mindanao

IV. Western Mindanao

Sulu 9 000

Others -.

SOURCEs Elizalde.& Co., Manila; Manila Cordage Co., Manila; Associated Steamship Lines, Consolidated Statistics of Cargo Movements for the Philippines, from the 1st of January to the 51st of December, 1955.

201 Table IV-XIV

QUANTITY OF BALED ABACA FIBER EXPORTED (Direct Exports Off-Shore from Baling Locations, Trans-Shipped through Manila; Trans-Shipped through Cebu, and Total Exports of Baled Abaca Fiber by Province) Showing by Port and Province, 19551/ (Metric Tons) Quantity Exported I Direct Offshore Quantity Trans- Quantity Trans- Total Exports of From Baling shipped Through shipped Through Baled Abaca Fiber, Export Port and Province Locations Manila Cebu By Province

2MAImA 6,300 - -

REGION I - Southern lMindanao 200 52,800 4,100 57,100

Davao - - 57#100 Davao 200 52,800 4,100 - Cotabato

REGION II - Bical 3.150 22,203 25i353

Albay - 8,500 Legaspi 1,500 - Tabace 50 7,000

Camnarines Sur -i205 Nato - 3,200 Tigaon - 5

Catanduanes - - 3,000 Virac 3,000

Sorsogon - 10,650 Bulan 1,.00 Casiguran - 2,500 Gubat - 600 . Sorsogon 5,900

REGION III - Eastern Visayas 1.600 17,450 21,350

Cebu -- 16,700 Cebu 1,600 15,100 Table IV-XIV (Continued)

Quantity Exported Direct Offshore Quantity Trans- Quantity Trans- Total Exports of From Baling shipped Through shipped Through Baled Abaca Fiber, Export Port and Province Locations Manila Cebu By Province

Leyte - 3,800 Baybay 600 MAitbog - 1,500 - Tacloban - 1,700 -

Sanar j-- 650 Calbayog 100 - Carangian 50- Catbalogan 25 - Laoang - 25 ­ Z~3 0 TOTAL - PHILIPPINES CA) 11,250 92,453 6,200 109,903

PERCENT OF TONS EXPORTS 10.24 7. 86.127, 5.64 7. 100.00 7.

SOURCES: Associated Steaship Lines, Consolidated Statistics of Cargo Movements from the Philippines, from the 1st of January to 31st of December, 1955.

1 These figures include small shipments of Ramie, and Maguey. Ramie exports were about 1,300 metric tons while Maguey probably did not exceed 200 metric tons. Figures for total export based on the above source differ slightly from those derived from total quantity of abaca fiber baled. Future Developments in Abaca

The future of abaca production depends upon two factors. First, the world market for abaca and second,changes in production methods.

In the report noted above Dr. Davis has investigated the future of abaca in world markets.!' The principal problems stem from competition with vegetable fibers, particularly sisal, and from synthetic fibers especially over a longer period in the future.

"The pattern of competition with the natural fibers has become fixed and appears unlikely to change. Sisal is more desirable than abaca for baler twine and the cheaper fibers will hold the large markets for both baler and binder twine. It is not within reasonable possibility, nor desirability, that abaca should sell at such low prices as to permit its use in these end products. In the United States more than 80% of all hard fiber rope is made from abaca, in England only that part for which the government permits imports. It does not seem probable that any of the boundaries between abaca and other hard fibers will change appreciably within the next decade or longer."

In effect this means that abaca faces an inelastic demand for price decreases and an elastic demand for price increases in competition with natural fibers.

"Synthetic fibers threaten a more dynamic competition..... The forecast for synthetic competition must be made with consideration for time and the price levels of abaca..... For the next ten or fifteen years the inroads (of synthetic over abaca) will probably be moderate unless abaca prices rise to very high levels. Otherwise, synthetic producers will still be unable to meet abaca competition on a broad basis and will look to other fields for consumption of their products."

1/ Thomas Jeff Davis, Report to the Government of the Philippines on Policies for Abaca, Rome, July 1956 (Mimeographed). 2/ Ibid, p. 5 3/ Ibid, p. 5,6.

904 Therefore, the elastic demand upward is strengthened by competition with synthetic fibers and the inelastic demand downward in competition with natural fibers constitutes an effective check to sharp price declines, so long as there is no overproduction.

Dr. Davis concludes:

"The outlook for the next ten years is therefore not as unfavorable as is sometimes supposed. Because of the depletion of Central American stocks and the reduced level of additional production and because of the high rate of shipbuilding, the chances are that 1956 will be a better year for abaca than 1955. However, long-term trends will re-assert themselves and succeeding years may see a very gradual decline in consumption. It is very unlikely that there will ever in peace time be a return to the pre-war export levels which were well in excess of a million bales."1/

Confronted with this market situation the primary problem in the production of abaca is the cost of production. If lower costs of production are to be achieved it will mean a shift to larger abaca farms. To the extent this occurs it will probably mean a shift of production to the Davao area and a relative drop, if not absolute drop, in production of the Bicol and eastern Visayan regions. This shift would not constitute a sharp departure from the present pattern of movement,however.

Transportation Needs and Improvements in Relation to the Movement of Abaca

The movement of abaca has been separated into three categories:

1. Loose abaca fiber to baling locations. 2. Loose abaca fiber to manufacturers. 3. Baled abaca fiber to ports of export.

1/ Ibid, p. 6. 1. The principal transportation problem with relation to the movement of loose abaca fiber is similar to that for copra, namely, the excessive use of water transport and the lack of market alternatives to the nroducer. The condition and lack of roads is the principal need to allow for greater use of trucks.

This is particularly the case in Region I, the Davao area. Moreover improved roads would facilitate the process of concentrating production to the extent this is desirable on the part of the governmen

In the eastern Visayan-northern Mindanao region the same problem exists but to a lesser extent.

In the Bicol area the condition of roads results in only a minor problem in the collection process of abaca.

2. The transportation problems in the movement of loose abaca fiber to manufacturers is the same as shipments of loose abaca fiber to baling locations. This is a problem principally in the Davao region.

3. In respect to the movement of baled abaca to ports of export the basic question concerns in-transit shipments to Manila.

At present there are two fundamental reasons for in-transit ship­ ments to Manila. First is the differential in freight rates for shipments to most world markets. The rate from Manila is lower than from ports adjacent to baling locazions such as Davao and Legaspi-Tabact This reflects in large part the fact that the size of shipments makes it less profitable for the offshore vessels to call at ports other than Manila for abaca shipments. In addition, there are customs of the trade, which strongly encourage in-transit shipments through Manila. In the situations where freight rates are equal between Manila and other ports for abaca shipments, the customs of the trade are the dominant factor explaining in-transit shipments.

If production becomes more concentrated, particularly in the Davao area, the size of shipments may induce offshore vessels to equalize freight rates and call directly at ports other than Manila thus re­ ducing the requirement for interisland vessels.

The problem is one of achieving shipments of sufficient size to induce offshore vessels to call directly and in addition to overcome present customs of the trade.

206 /

Appendix IV-C

2o7 Table IV-C-I'

AREA PLANTED TO ABACA, MAGUEY AND RAMIE BY REGION AND PROVINCE June 30, 1955 (Hectares)

Region and Province Abaa Maguey Ramie

Philippines 217.,020 2,980 2,900

Ilocos 110 430 10 Abra . Batanes 30 - 10 Ilocos Norto 10 170 - Ilocos Sur 60 260 - La Union 10 ./

Cagayan Valley 70 20 30 Cagayan 30 10 Isabola 30 10 30 Mt. Province 2/1/ Nueva Vizoaya 10

Central Luzon 250 380 Bataan - Bulacan 1 Nueva Ecija 10 1/ . Pampanga 10 Pangasinan 190 370 - Tarlac 20 10 - Zambales 20

Southern Tagalog 280 ] Batangas 10 1 Cavite 10 - Laguna l! . Marinduque 10 - Mindoro Occidental) ]/ Mindoro Oriental ) 10 Palawan 20 2!1 Quezon 220 - Rizal 1/ - Manila - -

Bicol 74,430 10 20 Albay 28,360 1/ - Camarines Norte 3,570 2! - Camarines 8ur 19,420 2! 20 Catanduanes 9,340 Masbate 130 10 - Sorsogon 13,610 2! - Table IV-C-I (Continued)

Region and Province icAbaca J Maguoy Ramie

Eastern Visayas 19 ,g80 2,0/0 Enhol 1,330 450 Cebu 130 1,530 Leyte 10,400 60 Sanar 8,020

Western Visayas 100720 100 Antique 450 Capiz 350 Iloilo 50 20 Negros Occidental 230 Negros Oriental 610 80 Romblon 30 V/ Northern & Eastern Mindanao 20,360 450 Agusan 1,630 450 Bukidnon 6,860 Lanao 1,780 Misanis Occidental 380 Misamis Oriental 1,800 Surigao 7,910 .29

Southern & Western Mindanao 99,920 Cotabato 8,830 2/ 1,490 Davao 86,720 I2/ 900 Sulu 1,250 2/' Zanboanga del Norte) Zamboanga del Sur ) 3,120

.I Less than 10 hectares.

Source: Depnattnent of Agriculture and Natural Resources, Division of Agricultural Economics.

210 Table IV-C-II

FIRMS BALING ABACA FIBER PHILIPPINES, 1955

Location Name of Firm

Manila - Manila Cordage Philippine Hemp Exp. It Southern Mindanao

Davao: Santa Ana - Columbian Ropo Kor and Co. Sasa - Columbian Rope Conrad and Co. Macleod and Co. Smith, Boll and Co. Madaum - Macleod and Co. Pancho - Tagum Agricultural Division Kapalong - Abaca Corporation Phil. Ra-me Decorticating

II. Bicol Region

Camarines Sur: Tigaon - Macleod and Co. Joso Robles Smith, Bell and Co. Nato - Pascual P. Leelin

Albays Tabaco - Smith, Boll &nd Co. Columbian Rope Erquiaga, Inc. United Commodities Legaspi - United Commodities

Boreogons Gubat - Andia and Bilbao Sorsogon - Philippine Hemp Exp. Bulan - Andia and Bilbao Conrad and Co. Maclood and Co. Casiguran - Conrad and Co. Macleod and Co.

Catanduanes: Virac - Columbian Rope Conrad and Co. Macleod and Co.

211 Table IV-C-II (Continued)

FIRMS BALING ABACA FIBER PHILIPPINES, 1955

Location Name of Firm

III. Visayao

Samar: Catarman - Manila Cordage

7"-loban - Columbian Rope - Baybay - Aboitiz and Co. Malitbog - Hijos de F. Escano L. Escano and Co.

Cebut =ebu - Aboitiz and Co. Columbian Ropo Conrad and Co. Smith, Bell and Co.

8OURCE: Department of Agriculture and Natural Resources, Fiber Inspection Service.

212 Table V-C-III

EXPORTS OF CORDAGE AND HEMP RUGS, BY PORT OF EXPORT AND PROVINCE 1955

(1) (2) (3) (4) Exported Direct Off- Port of Export shore from Producing Transshipped through Total Area Manila Exports

CORDAGE: 4,700

Manila 4,700 -

HEMP RUGS: 1,800

Albay 600 Logaspi 400 60 Tabaco 100

Catanduanes 5 Virac 5

Others 2.) 1,200 1,200

1/ According to the Fiber Inspection Service, probably most of the produc­ tion could be included under the province of Albay.

Source: Associated Steamship Lines, Consolidated Statistics of Cargo Movements from the Philippines from the 1st of January to the 31st of December, 1955.

213 TOBACCO AND TOBACCO PRODUCTS

PREVIOUS PAGE 81 IK Tobacco and Tobacco Products

In 1955 the area planted to tobacco was 52,600 hectares which com­ prised less than one percent of the total area planted to all crops. Total production was slightly more than 30,000 metric tons.

Two types of tobacco are grown in the Philippines--Virginia leaf and native or cigar leaf tobacco. Virginia leaf is consume..d almost en­ tirely in the domestic market in the manufacture of cigarettes.-1/ Pro­ duction of Virginia leaf has been a recent development in the Philippines having expanded rapidly since 1951. From about 45 metric tons in 1951 production jumped to approximately 10,000 metric tons in 1955 and during the first six months of 1956 had reached a total of over 17,000 metric tons.-

Native leaf or cigar leaf is used in the manufacture of cigars and native cigarettes both for the domestic market and export, and is ex­ ported to world markets as cigar leaf. Total production was almost 20,000 metric tons; about half of which was exported as cigar leaf, the remaining 50 percent going into the manufacture of cigars and cigarettes. Only small quantities of leaf are marketed locally to be made into home­ made cigars.

Methods of Marketing Tobacco

Both types of tobacco are most commonly grown on small farms. The average size tobacco farm according to the Census of 1948 was 2.47 hec­ tares in size.

1/ A small shipment of approximately two metric tons was shipped to Hongkong in 1955. 2/ According to Mr. Stonehill, President of the Philippine Tobacco Flue-Curing and Redrying Corporation, Manila, production in 1956 should be greater than 18,000 metric tons. 3/ Department of Agriculture and Natural Resources, Philippine Agri­ cultural Statistics, Vol. II, 1956, p. 101.

217 Theproducerof Virginia leaf after harvesting the tobacco places the leaves in a small curing barn. From these curing barns small bundle loads are sold to Farmers Cooperative Marketing Associations, tobacco dealers, or to the Philippine Tobacco Flue-Curing and Redrying Corpora­ tion through agents. These buyers classify and bale the tobacco at bal­ ing locations. In some cases, the individual producer will bring the bundles to the baling locations in small unit loads, by carabao or bus. Probably in most instances the buyers will pick up the bundles by truck from subagents or collection points along a road. After the tobacco is classified and baled (each bale weighs approximately 50 kilos) it is then shipped by truck to a redrying plant.1/

In 1955 the Philippine Tobacco Flue-Curing and Redrying Corporation had the only plant in the Philippines. It is located in Manila and has four redrying machines. The Philippine Tobacco Association and the Central Cooperative Exchange opened redrying plants in June, 1956, at Agoo, La Union with one and two redrying machines, respectively. The Philippine-Sino-American Development Corporation and the Pacific Tobacco Corporation will open plants during 1956 in the Manila area with a com­ bined total of three redrying machines.

After the Virginia leaf is redried, it is placed in hogsheads, stored, aged and then shipped by truck to the cigarette factories all of which are located in Manila and its environs.2/ Cigarettes are distrib­ uted in a pattern similar to most conusmer goods shipped from Manila to provincial markets.

In the case of native cigar leaf tobacco, the producer dries the cigar leaf in the sun for three or four days after which it is dried for one to two weeks in the shade usually in a nipa drying shed. During the drying period, the cigar leaf is placed on sticks. These sticks or bundles comprising small loads are then brought by the producer to a local merchant or agent or to a collection point. From these points tobacco buyers collect the bundles of tobacco by truck and haul them to

1/ The producer may classify the tobacco before it is brought or picked up for baling. According to Mr. Stonehill, the producers classified about one-third of the Virginia leaf sold in 1955. 2/ The locations and firms manufacturing Virginia leaf cigarettes are shown in Appendix IV-D. 3/ See section below on Trade areas.

218 a baling location. The cigar leaf is then baled (each bale weighs ap­ proximately 110 kilos) and shipped by truck and to a much lesser extent by rail and interisland ship, to ports of export, to jobbers or cigar and cigarette manufacturing plants in the Manila area.1/ About five per­ cent of the cigar leaf is classified and blended by jobbers and re­ shipped in bales to cigar and native cigarette manufacturers in the Ilocos region.-- Cigars and cigarettes for the domestic market are dis­ tributed in the same manner as most consumer products distributed from Manila to provincial markets.

Origin and Destination of Virginia Leaf Tobacco, 1955 and 1956

As shown on Table IV-XV and Figure IV-19, Virginia leaf tobacco production was concentrated in the Ilocos region of Northern Luzon. About 93 percent of the total production in 1955 was grown in the Ilocos provinces of La Union, Ilocos Sur and Ilocos Norte. Central Luzon pro­ duced most of the remaining Virginia leaf grown in the Philippines, Pan­ gasinan being the principal producing province of that region.

Table IV-XVI shows the production of Virginia leaf for the first six months as indicated by the receipts of the Philippine Tobacco Flue- Curing and Redrying Corporation at Manila. The same basic geographical pattern of production was maintained although the central Luzon provinces produced a greater percentage of total production and Mountain province and Mindoro initiated production on a scale worth noting.

In 1955 based on actual receipts of the Philippine Tobacco Flue- Curing and Redrying Corporation3/approximately 9,000 metric tons or 180,000 bales were shipped from Northern Luzon to Manila. This movement was by trucks most of which were privately owned by the Corporation. The remaining 1,000 metric tons of Virginia was rejected as low grade and was sold on local markets or to cigar and native cigarette manufacturers in the Ilocos for blending purposes.

1/ The locations and firms manufacturing cigars and native cigarettes are shown in Appendix IV-D. 2/ The cigar leaf from the Ilocos region is also originally shipped to Manila, classified and blended and sent back to factories located in the Ilocos provinces. 3/ See Appendix IV-D, Table IV-D-III at the end of this discussion.

219 Go

FIG. IV-19 VIRGINIA LEAF TOBACCO PRODUCTION BY PROVINCE 1955

220 Table IV-XV

VIRGINIA LEAF TOBACCO: ESTIMATE OF AREA AND PRODUCTION BY REGION AND PROVINCE 1955

Area in Quantity PR-oc.ucod Percent of Total Aeu5 A9., 1t 9R . HPOtares . hbtric Ton I Production Philippinos 15,500 10,100 100.0

Ilocos 91.9 Abra 200 20C Batanos Ilocos Norto 700 400 Ilocos Sur 2,400 3,400 la Union 10,800 5,400 4.6 Central J~gr - Bataan Bulacan Huovt Ecija Parpanga 50 50 Pang-sinri 800 400 Tarlac 5 1 Zambalos 50 30 0.2 Canmn Vaqll.0y 5D­ 11 Cagayan 30 Isabol,- 20 6 Nuova Vizceye It. Provinco 1-0 Weten ipy~a 250 1.5 Iloilo Negros Occidental 50 50 Nagrci Oriental 200 100

All Othor 200 200 1.9

Note: Detail may not aam to totals due to rounding. Insignificant amounts, ordinarily not shown when rounding, are shown here to give a more complete picture of the production.

Source: Department of Agriculture and Natural Resources, Division of Agricultural Economics.

221 Table IV-XVI

VIRGINIA LEAF TOBACCO: ESTIMATED PRODUCTION BY REGION AND PROVINCE January-July, 19561/

Quantity of Virginia Leaf Tobacco Quantity Percent of Region or Province (metric tons) Total Production

Philippines 15,400.0 100.0

Ilocos Region 12,700 82.3 Abra 65 Ilocos Norte 2,200 Ilocos Sur 3,200 La Union 7,200

Central Luzon 2,000 13.1 Pangasinan 1,800 Pampanga 3 Nueva Ecija 50 Bulacan 40 Tarlac 100 Zambales 6

Cagayan Valley 520 3.3 Cagayan 10 Nueva Vizcaya 15 Mountain Province 500

Mindoro 1.1

Visayas 22 0.1 Iloilo 2 Negros Occidental) 20 Negros Oriental )

Note: Figures rounded. Small amounts are shown here to give a more complete picture of production.

1/ Dased on actual receipts of Virginia leaf tobacco at Manila, January I-July 8, 1956.

Source: Philippine Flue-Curing and Redrying Corporation, Manila.

222 In the first six months of 1956 this movement had increased by 66 percent to approximately 15,000 metric tons or 300,000 bales. It is estimated that an additional 2,000 metric tons will be shipped to the redrying plants of the Central Cooperative Exchange and the Philippine Tobacco Association at Agoo, La Union during 1956, and an additional 500 to 1,000 metric tons to Philippine Tobacco Flue-Curing and Redrying Cor­ poration at Manila.1/

Therefore, the great bulk of the demand for transportation facili­ ties generated by the movement of Virginia leaf tobacco in the Philip­ pines is generated by shipments from northern Luzon to Manila of baled Virginia leaf. The movement of hogsheads from the redrying plants in Manila to cigarette factories constitutes a minor demand and moreover the trucks are privately supplied.

Origin and Destination of Cigar Leaf or Native Tobacco, 1955

As shown on Table IV-XVII and Figure IV-20 cigar leaf tobacco was grown to some extent in most provinces in 1955, however, 55 percent was raised in the provinces of Isabela and Cagayan. The next largest pro­ ducers were Pangasinan, Ilocos Sur and Cebu which comprised 12, 10, and 5 percent, respectively, of total production. The combined production of other provinces represented about 18 percent of total production of cigar leaf tobacco.

As in the case of Virginia leaf tobacco most of the demand for transportation stemmed from movements from Northern Luzon, particularly the Cagayan Valley, to Manila where the cigar and native cigarettes are manufactured for the most part and the point from which cigar leaf is exported (see Table IV-XVIII). In 1955 about 15,000 metric tons of baled cigar leaf or approximately 75 percent of total cigar leaf production was moved from the North to Manila principally by truck. The remaining 25 percent of cigar leaf production or about 5,000 metric tons originated in provinces throughout the island and was shipped in bales in relatively small unit loads, by interisland ships, truck, and rail.

1/ Philippine Tobacco Flue-Curing and Redrying Corporation, Manila.

223 Table IV-XVII

NATIVE OR CIGAR LEAF TOBACCO: ESTIMATED AREA AND PRODUCTION BY REGION AND PROVINCE 1955 (Metric Tons)

Production Area Quantity Percent of Total Region and Province (hectares) (metric tons) Prcduction

Philippines 37,200 20,000 100.0

Ilocos Region 6,100 2,000 10.0

Abra 400 75 Batanes 10 3 Ilocos Norte 150 240 Ilocos Sur 4,600 1,900 La Union 1,000 600

Caravan Valley 17,700 11,000 55.0 Cagayan 3,000 2,000 Isabela 14,300 8,900 Nueva Vizcaya 20 4 Mountain Province 300 100

Central Luzon 4,800 2,700 13.4

Bataan -- - Bulacan -- -­ Nueva Ecija 700 240 Pampanga - - Pangasinan 4,100 2,400 Tarlac 40 9 Zambales 40 2

Southern Tagalog 200 70 0.3

Batangas 100 30 Cavite 30 1 10 Laguna Marinduque 20 5 Mindoro Occidental 20 6 Mindoro Oriental 20 7 Palawan 10 3 Quezon 10 2 Rizal Manila

224 Table IV-XVII (Continued)

Production Area Quantit Percent of Total Region and Province (hectares) (metric t ons) Production

Bicol 500 100 0.5

Albay 10 2 Camarines Norte Camarines Sur Catanduanes 20 6 Masbate 400 100 Sorsogon

Eastern Visavas 2,400 1,600 7.8

Bohol 300 100 Cebu 1,300 1,000 Leyte 700 300 Samar 200 100

Western Visyas 2,100 1,000 5.2 Antique 300 200 Capiz Iloilo 700 400 Negros Occidental 500 300 Negros Oriental 500 200 Romblon 100 50

Northern and Eastern Mindanao 900 500 2.3 Agusan 200 100 Bukidnon 100 30 Lanao 300 200 Misamis Occidental 100 30 Misamis Oriental 300 100 Surigao 30 10 Southern and Western Mindanao 2,500 1,100 5.4 Cotabato 1,300 700 Davao 500 20 Sulu 100 40 Zamboanga del Norte 300 200 Zamboanga del Sur 300 200

Note: Figures rounded.

Source: Department of Agriculture and Natural Resources, Division of Agricultural Economics.

225 -L1o d

-Legend­ (metric tons)

oo5,000 -- -

0

a Oa

FIG. IV-20 NATIVE CIGAR-LEAF TOBACCO PRODUCTION BY PROVINCE 1955

226 Table IV-XVIII

EXPORTS OF CIGAR LEAF AND CIGARS AND CIGARETTES BY PORT OF EXPORT, 1955

I­

Cigar Leaf 11otric Tons Ciga Lea' £'tricTon Manila 8,600

Cebu 700

Total Export of Cigar Leaf 9,300

Cigar and Cigarettes:

Mbnila 400

I

Note- Figures rounded

SOURCE: Associated Steamship Lines Consolidated Statistics of Car' love:Jnts fron fes Philo. i lot Janury. to 31st Decembo.:-, 1 555

227 Future Developments in Tobacco

Future increase in Tobacco production will depend almost entirely upon Virginia leaf tobacco. It is estimated that the demand for cigar leaf tobacco will remain at about the existing level over the next dec­ ade, both for use in the domestic manufacture of cigars and native leaf cigarettes and in the export of cigar leaf to world markets. There should be no appreciable shift in the regional and provincial pattern of production and distribution of cigar leaf tobacco over the next decade.

In respect to Virginia leaf tobacco it appears that domestic needs will continue to be met by domestically grown Virginia leaf. In fact, during 1956 there was a surplus of production in relation to domestic requirements. However, according to the Philippine Tobacco Administra­ tion this is desirable to allow sufficient inventories to be accumulated to properly age and store the tobacco before being used in cigarette manufacture.

The consumption of Virginia leaf tobacco in the manufacture of ciga­ rettes between 1951-1955 is set forth in the following tabulation.

VIRGINIA LEAF TOBACCO CONSUMED IN THE MANUFACTURE OF CIGARETTES

Year Tons

1951 3,943 1952 6,033 1953 11,095 1954 12,671 1955 13,677

Source: Bureau of Internal Revenue, Statistical Division.

Assuming a 5 percent increase per annum it has been estimated that pres­ ent annual production levels will fill domestic needs for the next five years and will increase to about 23,400 metric tons by 1966.

The possibilities for export of Virginia leaf are still doubtful, because of problems of standardization, quality of tobacco and competi­ tion from other countries. If exports could be realized, however, it is possible for another 20,000 metric tons to be produced. Even if this

228 were to develop the same regional production and distribution is likely to be maintained, with the possible exception of relative growth in the production of Mindoro Occidental.

Transportation Needs and Improvements in the Movement of Tobacco

The problems of transportation in relation to the production and distribution of tobacco are relatively minor compared with other agricultural products, both domestic and export. Moreover, the total tonnage is small in relation to other agricultural commodities.

Considerations for improvement in roads can be related to the col­ lection and distribution of tobacco products. However, present condi­ tions do not constitute a serious problem.

For future production in Mindoro, new roads would undoubtedly lower costs of transport.

229 Appendix IV-D

pIlVO r, wa Table IV-D-I

FIRMS MANUFACTURING VIRGINIA CIGARETTES, PHILIPPINES

Name of Firm Location

Bagumbuhay Cigarette Factory 103 A. del Monte, Grace Park, Rizal Dollar Tobacco Co. 45 Callejon, Reina Regente, Manila Philippine-American Cig. & Cigt. Mfg. Co. 219 Protacio, Pasay City Pioneer Tobacco Corp. 2691 A. de las Alas, Sta. Ana, Manila St. Louis Tobacco Corp. Clavel Cor. Barcelona St., Manila Standard Cigarette Mfg. Co., Inc. 36 Cayetano Arellano, Malabon, Rizal U. S. Tobacco Corp. 24th & Boston Sts., Port Area, Manila La Suerte Cig. & Cigarette Factory 165 Dolores, Pasay City El Ideal Cig. & Cigarette Factory Acacia, Malabon, Rizal La Perla Cig. & Cgt. Factory, Inc. 224 Quirino Ave., Paraiaque, Rizal Westminster Tobacco Corp., Inc. 91 J. Rizal, Mandaluyong, Rizal International Tobacco Co., Inc. 316 Del Pan Street, Manila Bataan Cigar & Cigarette Factory 680 Muelle de Binondo, Manila La Flor de Isabela 240 M. de Comillas, Manila

EuUSPAGE BLANK

233 Table IV-D-II

FIRMS MANUFACTURING CIGAR AND NATIVE CIGARETTES, BY REGION, PHILIPPINES

Manila Area Cigars Name of Firm Location

1. Alhambra Cigar & Cigarette Mfg. Co. 31 Tayuman, Tondo, Manila 2. Compania General de Tobacos de Filipinas 848 M.de Comillas, Manila 3. Dona Rosa Cigar Factory Tonsuya, Malabon, Rizal 4. Katubusan Tobacco Corp. 2137 Juan Luna, Tondo, Manila 5. La Azucena A Bonifacio, Malabon, Rizal 6. La Bonita Cigar Factory 48 Tonsuya, Malabon, Rizal 7. La Carmelita Cigar Factory Tonsuya, Malabon, Rizal 8. La Flor de la Isabela 240 Marquez de Comillas, Manila ca 9. La Flor de Luzon Cigar Factory Javier St., Malabon, Rizal 10. La Loreta Cigar Factory Catmon, Malabon, Rizal 11. La Hermosa Cigar Factory 252 General Luna, Malabon, Rizal 12. La Magdalena Cigar Factory Catmon, Malabon, Rizal 13. La Mallorca Cigar Factory Tonsuya, Malabon, Rizal 14. La Marina Cigar & Cigarette Factory 121 M. Nuval, Navotas, Rizal 15. La Nebleza Cigar & Cigarette Mfg. Co. 91 A. Mabini, Caloocan, Rizal 16. La Patria Cigar Factory Burgos, Malabon, Rizal 17. La Suerte Cigar & Cigarette Factory 165 Dolores, Pasay City 18. La Verdad Cigar Factory Tonsuya, Malabon, Rizal 19. Las Amigas Cigar Factory Tonsuya, Malabon, Rizal 20. Malabon Cigar Factory Malabon, Rizal 21. Nacional y La Fuerza Cigar Factory 160 A.Mabini, Caloocan, Rizal 22. Tinajeros Cigar Factory Tinajeros, Malabon, Rizal Table IV-D-II (Continued)

Manila Area Cigarettes (Native) Name of Firm Location

1. Alhambra Cigar & Cigarette Mfg. Co. 31 Tayuman, Tondo, Manila 2. Bagong Buhay Cigarette Factory 103 A. Del Monte, Grace Park, Rizal 3. Bataan Cigar & Cigarette Factory S. F. del Monte, Quezon City 4. Central Cigar & Cigarette Factory, Inc. 18 Canseco, S. F. del Monte, Q. C. 5. El Ideal Cigar & Cigarette Factory 122 Gen. Luna, Malabon, Rizal 6. Flor de Malabon Cigarette Factory Tonsuya, Malabon, Rizal 7. Insular-Yebana Tobacco Co. 65 M. H. del Pilar, Tugatog, Malabon 8. Katubusan Tobacco Corporation 1805 Juan Luna, Manila 9. La Campana Fabrica de Tab. Inc. 39 Sultana, Makati, Rizal 10. La Dicha-La Paz y Buen Viaje 635 Asuncion, Manila COl 11. La Flor de Isabela 240 M. de Comillas, Manila 12. La Fortuna Cigarette Factory 160 Gen. Luna, Malabon, Rizal 13. La Perla Cigar & Cigarette Factory 224 Quirino Ave. Paranaque, Rizal 14. La Suerte Cigar & Cigarette Factory 165 Dolores, Pasay City 15. Pacific Tobacco Corporation No. 2, 7th Ave., Grace Park, Rizal 16. Richmond Tobacco Co. Lansones Road, Malabon, Rizal 17. Standard Cigarette Mfg. Co. Inc. 36 Cayetano A -ellano, Malabon, Rizal 18. YCO - ABC - Tobacco Factory 121 Sanciangco, Tonsuya, Rizal 19. Liberty Cigarette Factory 11 Luna, Malabon, Rizal Table IV-D-II (Continued)

Ilocos Region Cigars name of Firm Location

1. Bening Cigar Factory Santa Catalina, Ilocos Sur 2. Glory Cigar Factory Santa Catalina, Ilocos Sur 3. Gonzalba Cigar Factory Aringay, La Union 4. La Caridad Cigar Factory Bo. No. 17 Laoag, Ilocos Norte 5. La Esperanza Cigar Factory Santa Catalina, Ilocos Sur 6. La Generosa Cigar Factory Santa Catalina, Ilocos Sur 7. La Laoaguena Cigar Factory Laoag, Ilocos Norte 8. La Liberal Cigar Factory Santa Catalina, Ilocos Sur 9. La Libertad Cigar Factory Santa Catalina, Ilocos Sur co 10. La Ludevina Cigar Factory Santa Catalina, Ilocos Sur 11. La Sta. Trinidad Santa Catalina, Ilocos Sur 12. Meding Cigar Factory Santa Catalina, Ilocos Sur 13. Ras-Mar Cigar Factory Santa Catalina, Ilocos Sur 14. Sisters' Cigar Factory Santa Catalina, Ilocos Sur

Ilocos Region Cigarettes (Native)

1. New (U. S. A.) Cigarette Factory San Fernando, La Union Table IV-D-II (Continued)

Other Region Cigars Name of Firm Location

1. La Lagueflan Cigar & Cigarette Factory Mabini Street, San Pedro, Laguna 2. La Pulupandeha Cigar Factory Pulupandan, Negros Occidental 3. Negros Cigar Factory M. H. del Pilar, Talisay, Neg. Occ. 4. Plaridel Cigar Factory Obando, Bulacan 5. Tatlong Bata Factory Batis, Guagua, Pampanga

Other Region Cigarettes (Native) b'3 W 1. Cavite~o Cigarette Factory Bacoor, Cavite 2. Malvar Cigar & Cigarette Factory Malvar, Batangas 3. Malba Cigarette Factory Maliksi, Bacoor, Cavite

Source: Bureau of Census and Statistics. Table IV-D-III'

VIRGINIA TOBACCO RECEIPTS 1955 Season

Quantity Region and Province Metric Tons Percent

PHILIPPINES 8,973 100.0 ILOCOS: Abra 3 Ilocos Norte 721 8.0 Ilocos Sur 1,393 15.5 La Union 6,496 72.4 CENTRAL LUZON: Nueva Ecija 25 0.3 Pangasinan 296 3.3 Tarlac 13 0.1 Zambales 1 CAGAYAN VALLEY: Cagayan 14 0.2 Isabela 1 SOUTHERN TAGALOG: Laguna 2 - Mindoro Occidental 9 0.1

SOURCE: Philippine T6bleco Fluie-Curing and ledrying Corporation, Manila.

.238 Section V

FOREST AND LUMBER PRODUCTS Section V

FOREST AND LUMBER PRODUCTS-,

About half of the timber produced in the Philippines--more than one and a half billion board feet in the fiscal year 1954-1955--is exported, mostly in the form of logs moving short distances to nearby coastal landings for shipment overseas. The pattern is similar to that of most other primary export products, especially sugar and minerals. Only a little more than one-third of the timber is manu­ factured into lumber in the Philippines and a small amount of products such as veneer and plywood.

About five-sixths of the lumber manufactured in the Philippines is sold domestically, some of it moving fairly long distances. Manila is the principal market, apparently consuming about one-third to one-half the recorded production, lesser amounts going to the Visayas and parts of central and northern Luzon. Although many problems face the industry, including some related to transportation, prospects for increasing timber and lumber production are good, with large stands available especially in Mindanao.

Present Producing Areas

The distribution pattern of timber production may be seen..in Figure V-21. (See also Table V-I at the end of this section).2/ Mindanao is the chief producer--especially the northeastern provinces of Agusan and Surigao--followed by the southeastern coast of Zamboanga del Sur. Other leading producers in order are: Negros Island--especi­ ally Negros Occidental--the only significant producer in the whole Visayan Islands; southeastern Luzon--especially Camarines Norte and Sur, and Quezon Province--and some in Mindoro; northern Luzon in Mountain and Cagayan provinces. There are thus three (or four, if northern Mindanao

1/ Acknowledgment is made to the Bureau of Forestry, Paul Bedard of ICA, Ralph Dempsey, Dee Cho, and others for assistance and data. 2/ Tables for Section V will be found at the end of the section.

241 -Legend-

METRIC TONS BOARD FEET (thousands) 100,000 S 200,000 I----100,000 50,000 I 50,000 25,000

4?P

0

0.1

FIG. V-21 TIMBER AND LOG PRODUCTION BY PROVINCE 1954-1955

242 is divided into two sections as noted above) principal producing regions. Most of central Luzon, the Ilocos coast on northeast Luzon and the Visayas are small producers, generally not even producing sufficient amounts for all their local needs.

Although lumber production is about one-fifth that of timber, the distribution pattern of lumber production (Figure V-22) resembles the distribution pattern for timber, except for the concentration of saw­ mills in Manila. There is also relatively less lumber production in Mindanao, and more production in the other deficit areas of the Visayas and Luzon based on movement of logs to mills in these areas. The rela­ tive importance of lumber to timber can be judged approximately from the lumber map (Figure V-22), where the lumber scale is five times that of the timber scale.

Forest Areas and Their Potential

Superficially the distribution of timber reserves resembles timber production (Figures V-21 and V-23. See also Table V-II at the end of this section). However, significant differences are apparent. Mindanao has relatively greater timber potential than its present production would indicate. Negros, although possessing fairly large timber re­ serves, nevertheless has far less in relation to production than have Mindanao and some other areas. Camarines and Quezon in southern Luzon and Mindoro have significant timber reserves, but not to the extent that Mindanao has. Samar and Palawan have relatively large reserves and very small production.

The same relationship applies to the Cagayan Valley provinces, especially Isabela and Nueva Vizcaya, whose reserves are barely being exploited. The coast of northeastern Luzon is rough, exposed to heavy seas especially during the northeast monsoon and has few good harbors, which has hindered development. If the Manila Railroad builds an ex­ tension to the Cagayan Valley this may spark some increase in production.

Not only does Mindanao have by far the greatest reserves of timber of any area, but it also is the scene of the most rapid new development, primarily for export, but with some production for the domestic market. Future exploitation in Mindanao, however, as in the rest of the Philip­ pines, is largely dependent on the foreign market.

243 -Legend-

METRIC TONS BOARD FEET (tousn0) 40,000 20,000

20,000 10,000 10,000 5,000 5,000 2,500 0 0

0L

FIG. V-22 LUMBER PRO UCTION BY PROVINCE DURING THE FISCAL YEAR 1934-1955

244 -Legend­

(metric tons (board feet in thousands) in millions) 15,000 7,500 10.000 5,000 5,000 2,500 11.0 0

C?

0Q

FIG. V-23 VOLUME POTENTIAL ACCESSIBLE FOREST (EXCLUDING PROTECTION FOREST) BY PROVINCE

1 245 Forest areas in the Philippines are mainly owned by the government and are leased out in concessions. Theoretically the annual cut allowed is no more than regrowth. However, the type of logging practiced has not resulted in sustained yield in most areas. For example, the Insular Lumber Company on Negros, the largest lumber producer in the islands for years, will exhaust its timber concession within six or seven years. Other areas have already been cut over. Even allowing for a one-hundred year cutting cycle, clear cutting, instead of selective logging of the ripe trees, has not resulted in reproduction and regrowth of the forests, especially in the types of trees desired by the market.

All the facts about regrowth are not known; undoubtedly conditions vary from place to place in the islands. [nsofar as a somewhat limited budget permits, the Bureau of Forestry is vigorously promoting research and measures for sustained yield. In spite of the excessive cutting rate in many areas, however, much timber remains and much of it is or can be put on a sustained yield basis. The biggest problem is squatters and kaijigin (burning) agriculture which destroys trees. If this can be controlled, then sustained yield is possible. In the humid climate other fire losses are negligible. Higher prices for timber and larger investments either in good sawmills or further processing mills, such as pulp or paper, encourage the lumberman to harvest his crop wisely because the timber is worth conserving and is needed to repay high capital costs over a long period of time. Fortunately, both these trends appear to be occurrirg slowly in the Philippines. Conservation practices are still poor and the regulations full of loopholes, but a few enlightened small and large operators are going onto a sustained yield basis after encouragement and persuasion from the Bureau of Forestry. If conservation based on sustained yield is followed, a permanent, even larger scale lumbering than at present, is possible in many areas, particularly those with high ratios of reserves to cutting as in much of Mindanao.

The Bureau of Forestry has a land classification program which attempts to classify land into two categories: permanent forest (essentially slopes above 100 or lesser slopes with poor soil or other agricultural deficiencies) and agricultural land, If the potential agricultural land is timbered it is kept as temporary timberland blocks but is designated for future agricultural use as soon as the timber has been removed by clear cutting by licensees. Unfortunately, timbered lands in both categories often are taken over by squatters or kaingin

246 agriculture and the timber destroyed without being marketed. In the execution of the program, two reforms are necessary: 1) proper classification, including especially more detailed classification of the so-called agricultural land into suitable agricultural areas, before a road or other means of access make the area accessible; and 2) a rigid enforcement of the classification.!/ As it is now much valuable timber­ land is destroyed and no permanent agriculture results, neither of which benefits the country.

Lumber Production and Marketing

The total production of domestic and export timber and lumber for the fiscal year 1954-1955 is as follows:

Total Export Domestic

Bd. Ft. M. Tons Bd. Ft. M. Tons Bd. Ft. M. Tons 000 000 000

Timber 1,536,231 3,072,462 573,434 1,146,8682/ 962,797 1,925,594 Lumber 374,91C 749,832 56,019 112,038 318,897 637,794

Source: Annual Report, Bureau of Forestry of the Philippines, July 1, 1954 to June 30, 1955 (Manila, Bureau of Forestry, 1955) pp. 41 and 45.

Since the lumber is produced from the timber, the two figures, timber and lumber, cannot be added together. In reducing timber to lumber approximately half the volume is lost. More than one-third the timber is exported directly, but of the lumber produced from the remainder, about five-sixths is consumed domestically and probably constitutes the bulk of internal movement. Although exact figures are not available, most of this lumber is produced fairly close to timber producing areas and is shipped in rough form to market.

1/ Use of aerial photography would speed up the classification process of agricultural lands and also result in better surveys. Use of existing small-scale aerial photographs now available in other governmental agencies would help the program. 2/ Includes timber converted to lumber.

247 Some logs also move to domestic markets. Although the total volume of logs produced is almost five times greater than lumber, most of the logs move fairly short distances over company or other roada or along streams to the nearest coastal landing for export, or to nearby mills.

In addition to the lumber produced and transported locally, several end products are also produced. This production, however, is minor in comparison with lumber, save possibly firewood production which amounts to about 75,000 cubic meters (65,000 metric tons) paying forest charges reported by the Bureau of Furestry in 1951-1952.- Most of the firewood does not mcve long distances, although some is hauled by train.

Several plywood and veneer plants operate, mostly near Manila, with annual production of approximately 70,452,000 square feet of ply­ wood and 125,511,000 square feet of veneer. A variety of other products, many of them handicraft, are produced at various points scattered over the islands or localized in a few special centers. These products in­ clude furniture, wooden shoes, boxes, musical instruments, sporting goods, toys, matches, boats, charcoal, and products of bamboo, rattan, bark, resin and rubber. Most of the rubber is produced in Basilan Island near Mindanao, with expansion planncd in Mindanao to supply natural rubber to the tire plants built or building in Manila. The Nasipit Lumber Company is building a wallboard mill at Nasipit, Agusan in Mindanao, which will utilize waste and be a great boon to sound forestry. Tentative plans exist for pulp and paper mills at other places, principally Mindanao; some probably will be constructed. One United States company planned such a development for kraft paper, but could not get a firm enough commitment on a concession with a long enough lease to insure the sustained yield production necessary to support such a large capital investment. If longer life concessions could be granted on a flexible basis to concerns practicing good forestry, more capital expenditures might be made for mills utilizing more of the forest resources. The only paper mill in the Philippines at present producing paper from native raw materials is at Bais, Negros Oriental, which operates on sugarcane bagasse from an adjacent sugar mill or central. Some small firms produce some paper products from waste paper in Manila.

1/ Winslow L. Gooch, Forest Industries of the Philippines (U.S. Mutual Security Agency (ICA) and Bureau of Forestry, Philippines, Manila, 1953), p. 85.

248 Domestic lumber in the Philippines is generally rough milled in the form of cants (thick rough boards) and then shipped to finishing mills located in the large cities. There the cants are divided into thinner boards and are finished to smooth lumber. Much lumber is not finished but is used rough in construction. Much local building is also based on local logs which are sawed by hand into rough boards at the building site. Small towns buy their finished or rough lumber from larger cities; larger merchants may send their own trucks directly to the sawmills.

The relatively small size of the domestic market, according to some authorities, is a limiting factor in the development of an export lumber business. According to this argument, Philippine lumber for export is sold largely in the United States as a htgh quality product for interior trim. This luxury market can use only the highest grades of lumber; the lower grades not being able to compete, after a long ocean haul, with normal United States construction lumber such as fir or pine. The small size of the Philippine market limits conversion of Philippine logs into lumber at home for export, since there is little domestic market for the lower grades. In Japan, on the other hand, the large local market which lacks home grown lumber can absorb all available grades of lumber. The high grades can be exported to the United States. Hence Japan saws most of the Philippine timber. So anxious are the Japanese for this raw material that their ships put into numerous scattered laudings throughout the Islands, where American ships are reluctant to touch.

Other lumber brokers argue that if Philippine lumber did not demand such a high markup in the United States, lower grades of lumber could be sold there as well as the highest grades. Probably there is truth in both viewpoints.

Distribution and the Manila Market

No data are available on consumption of lumber by areas within the Philippines, with the exception of some data on lumber receipts at Manila as reported monthly by the Philippine Lumber Producers Association. These data have been processed to show origin by province of lumber and logs received at Manila as sent by individual shippers (Figure V-24. See also Table V-III at the end of this section). Not all the shippers could be located by provinces, but most have been;

249 -Legend-

METRICMETRI TONS BOARD(thousands) FEET 20,000 10,000 15,000 7,500 10,000 5,000 5,000 2,500 0 0

0

0.

FIG. V-24 LUMBER AND LOG RECEIPTS, MANILA (BASED ON 40% SAMPLE) 1954-1955

250 their combined shipments represent about 90 percent of the total tonnage received. This is a large sample, and should represent the proportions fairly, although some errors are likely in smaller shipments from smaller provinces.

The gravest defect of the figures is that, unfortunately, they do not appear to represent more than forty percent of the total receipts at Manila. Manila, for example, is reported by the Bureau of Forestry as producing about 36,000,000 board feet of lumber; Philippine Lumber Association receipts indicate about 28,000,000 board feet of logs arriving. If this figure is reduced by 45 percent to allow for re­ duction of logs in converting to lumber, it amounts to about 15,000,000 board feet,or about 42 percent of the lumber production as reported by .the Bureau of Forestry. This is 21,000,000 board feet short. Whether the discrepancy is as great in lumber receipts is not known. The figures, however, indicate no lumber receipts by truck, yet some lumber is known to arrive by that method.

On the basis of the foregoing, if one assumes that total reported timber and lumber receipts are only about half actual arrivals at Manila, then Manila receipts of 80,000,000 board feet, as reported by Philippine Lumber Producers Association, would be doubled to 160,000,000. This is about 60 percent of the 275,000,000 board feet total Philippine domestic production as reported by the Bureau, or about 50 percent of total domestic and export lumber production. Exports of lumber from Manila in 1954 amounted to approximately 8,000,000 board feet; in 1955 these exports were about 12,000,000. Therefore, it can be estimated that for the fiscal year 1954-1955, Manila's lumber exports were about 10,000,000 board feet, representing about 30 percent of Manila's lumber production./ The total national lumber exports are about 20 percent of total national lumber production. Thus, lumber exports from Manila are a higher percentage of Manila production than total national exports are of total national production. Therefore, it is more realistic to estimate Manila's receipts from total national lumber production, rather than from total domestic lumber production alone. Furthermore, Bureau of Forestry figures for total Philippine lumber production may well miss some local lumber which is hand-processed. It appears that Manila lumber receipts are about one-third to one-half total Philippine production, with one-half the more likely figure.

1/ Figures compiled from Associated Steamship Companies reports.

251 Furthermore, the Manila Railroad reports carrying 75,000 tons of lumber on its lines, practically all of it destined for Manila and vicinity; this is about 40 percent more than Philippine Lumber Pro­ ducers Association figures. On the basis of average-length-of-haul figures it is estimated that about half this lumber probably comes from Camarines Sur, and the remainder from Quezon. The railroad also brings some logs to Manila. For 1954-1955, the Manila Railroad reported total shipments of logs, posts, poles, and piles of 16,048 tons, with an estimated 70 percent destined for Manila. Since the average length of haul was reported as 299 kilometers, most of this 70 percent apparently comes from Camarines Sur.

An analysis of the origins by location of all shipments shows relatively little from adjacent provinces, because little lumber is produced there. Heavy shipments, as might be expected, come in from the nearest forested provinces: Quezon, Bataan, Zambales, and Mindoro. Quezon leads, but this, in large part, is because of its large size. The four provinces alone account for about 75,000 metric tons, or more than 40 percent of the total receipts as reported by Philippine Lumber Producers Association. The rest of the Philippines are, however, well represented with shipments all the way from northern Luzon to southern Mindanao and Palawan. Of the heavy producing areas only eastern Mindanao is poorly represented. Mindanao as a whole, however, supplies about one-third of Manila's requirements despite its distant location, reflecting both the heavy volume of Mindanao production and the dominance of the Manila market which can pull lumber right past Cebu City and the Visayan deficit areas.

Shipping brings in about 60 percent of Manila's lumber and logs, followed by rail with about one-third the amount brought in by ship, and by truck with less than half the rail figure, although only log­ truck receipts are reported; if lumber receipts are equal to logs, as many believe, then trucking would about equal rail.

Quantitative data on markets elsewhere do not exist. Most important undoubtedly are the large timber deficit islands of the Visayas: Cebu, and Panay, followed by Bohol. These three islands all get supplies from nearby Mindanao, and especially from Negros. which lies between Cebu and Panay. Boats, both large and small, are the principal means of transport. The Ilocos Coast of northern Luzon, another populous

252 deficit area, gets most of its lumber from the north coast of Luzon-­ the northern Cagayan Province, most , by truck. Water transport is utilized little, even though the road around northern Luzon is poor. Mountain Province produces large amounts of pine, but the demands of the mining industry in that province both for logs and lumber are so 1/ great that little moves out of the province.- The mining industry generally is a good market for lumber. For example, Philippine Iron Mines at Larap in Camarines Norte, the biggest single tonnage producer in the islands, has its own sawmill and concession only 14 kilometers distant and uses valuable Tangile wood for mine props; it is cheaper to use this hardwood than to import pine from Mountain Province.

Transportation and the Lumber Industry

Domestic transport problems in the lumber industry fall into two categories: 1) local movements from timber concessions to coastal export points or sawmills, and 2) longer shipments interregionally within the islands.

Access Roads and Coastal Landings

Inasmuch as most Philippine timber is cut near the coast and moved short distances to private ports or landings, there is little basis for national expenditures to improve the facilities, even though many of them are poor and seriously handicap the industry.

Roads are almost exclusively used to transport the timber from stands; only one major logging railroad exists, a 42-mile private line of Insular on Negros Occidental. More roads through forest areas un­ doubtedly would spur development. However, a public road into a timber concession is a dubious benefit because it brings in squatters who destroy the timber, as noted earlier. For this reason most large timber concessionaires prefer to operate their own private roads which they can control. Some of these systems, such as at Bislig on eastern Mindanao, are also built to higher standards than national highways, so that extra heavy trucks can operate and reduce hauling costs. For

1/ Gooch, op. cit. p. 25.

253' all these reasons, and the fact that many of the roads or a specialized beneficiary, serve only one it is questionable whether roads should be built forest access by the government in classification most areas* If a firm could be made oell land in advance of road if it could be rigorously construction and enforced, then the might be better. case for access roads In any case such classification urgently and enforcement required now along is new national highways Mindanao. being built, as in

Most of the logs exported are shipped through coastal landings, the crudest sort often with no of facilities of any sort; merely dumped by hand the logs are into the water and floated For this reason, out to ships at anchor. many vessels are reluctant the Japanese to call for timber, do send their ships. although In any case, very exported through national little timber is port facilities. Therefore, reasonable to it would seem have a flexible wharfage govern charge depending ent facilities are on whether employed.! At present sixty centavos a wharfage tax of is charged per cubic respective meter on logs or flitches of whether government wharf ir­ facilities are used. At some points on the islands, governnt wharf facilities would to the be advantageous industry. If the budget permitted, a few might be provided where they also served several operatos and other purposes, as in the of Butuan Agusan, area Mindanao where lumber production roads is now high and new to the interior are being built. Logs, however, unlike general cargo, can be handled after a fasho without port facilities; such facilities hence, are not so urgent, however desirable they might be. Such facilities in most cases, therefore, may have to be regarded as a luxury in a country with more pressing facility requiremegasd DomesticTransportation

From Figure V-24 Manila, and Table V-I , Lumber it can be seen that and Log Receipts logs and lumber come at the Islands from all parts of and by water, rail, and truck.

1/ This is also the recommendation Annual Report, of the Bureau of Director of Forestry Forestry: 19 of thePhilippines, July 54-Juzne 30, 1955, Manila, p. 47.

254 Complaints about high shipping costs for these movements are common in the industry, especially for water shipments. Water rates are usually considerably cheaper than land rates where trucking over poor roads is employed and when large scale, regular contract movements are not arranged. However, it is pointed out that it costs less to ship from northern Luzon to Hongkong than to Manila, even though the distance is greater to Hongkong than to Manila. Somewhat similar com­ plaints come from elsewhere that it often costs more per mile to ship domestically than foreign. Under these circumstances many of the advantages of a domestic market are illusory. There is less cohesion within the parts of the country than between the several parts and foreign countries.

The Bureau of Forestry, for example, states:

"Scarcity of bottoms is another drawback in the in­ dustry. Movements of logs and lumber from centers of production to the markets are adversely affected by lack of shipping facilities. Dearth of bottoms results in high freight rates, more noticeably in local trade. -

Some representative going rates as reported by the industry are given in Table V-IV at the end of this section. Published tariffs of the carriers mean little, because conditions change and quotations are not adhered to, especially in shipping and some trucking. Complaints against the services provided are even more common than price complaints. Regular calls of vessels may or may not pick up lumber and logs as promised. Rates for charter are erratic, 'some being very high for short distances, and service very slow or undependable. As a result regular, planned shipping is difficult. Particularly inaccessible is the east coast of Mindanao, mainly because of distance and rough water, where cost of shipment is so high that operators claim they are kept out of the Manila market, Barges will not go there because of the rough seas. LCT's are used but are so small that they can go only as far as Cebu, although an occasional scow can be chartered if there is a minimum of 1,000,000 board feet.

1/ Annual Report, Director of Forestry of the Philippines, July 1, 1954 to June 30, 1955 (Bureau of Forestry, Manila, 1955) p. 8.

255 It is apparent that interisland ships are reluctant to accept lumber, and especially logs as cargo. Logs drip onto the rest of the cargo, some are rejects from foreign ships and are sinkers. Lumber also is awkward to stow in small, general cargo vessels and particularly may delay the vessels on regular schedules. Surprisingly, the quoted rates appear to be lower than the actual rates at which lumber can move regularly. This appears to be the reverse of other commodities where rebates or reductions of various kinds under the established rates are common.

One basic trouble appears to be lack of suitable carriers, and in some cases suitable ports. To obtain suitable carriers volume is necessary. Ocean-going barges might be an ideal carrier. However, barges presently available cannot operate everywhere, especially on the exposed east coast of the Islands, are slow, and are reported by some as uninsurable. However, considerable expansion ii barge service is probably inevitable and desirable. Before the war there were some special lumber carriers operating from Palawan and elsewhere to Manila. They carried 500,000 to 600,000 board feet, had wide hatches for easy loading, cranes, engines aft, and were relatively fast, in contrast to barges. LCT's, used some now, are ideal for shallow waters, but their small capacity (120,000 board feet) makes them uneconomical.

Another basic trouble, related to volume, but also independent of it, is the existing attitude toward regularity of service and common carrier responsibility. Established government-regulated standards of service, and particularly their honest, economical enforcement, would be a great service to the industry and to the nation's economy. Erratic transport inhibits production and establishment of industry. However, the industry itself, and its market volume, changes so frequently from year to year and month to month because of price fluctuations and speculation within the industry and because of changing freight rates and availability of foreign shipping, that domestic carriers can hardly be blamed for not having peak facilities instantly available. The industry thus also has a responsibility. If conditions continue bad, the industry should put in its own specialized carriers. This of course, will still not solve the problem of flexibility, desirable in any case, but particularly inevitable in a small-scale speculative industry. Some stabilization of prices and flows is desirable to stabilize trans­ port and in turn the industry.

256 Conclusion: The Role of Transport and the Development of Lumber Markets

Thus for future economical development of the domestic lumber market, cheaper and more regular means of transport should be found. Provision of some sort of special carriers and establishment of reason­ able service standards seem to be the answers. Greater development of the domestic market, and home processing, and even of the foreign market, therefore depends in part, upon finding answers to better domestic transport.

257 Table V-I

TIMBER AND LUMBER PRODUCTION BY PROVINCE (Fiscal Year 1954-1955)

A B

Timber Production --Lumber Production PROVINCE Cubic Metric Metric Board Meters/ Tons 1 Tons Feet

Ilocos Region Abra 1,322 1,12t Ilocos Nrote 19,425 16,511 5,613 2,806,488 Ilocos Sur 103 98 La Union

Cagayan Valley Batanes Cagayan 95,340 81,039 22,884 11,441,961 Isabela 15,641 13,295 10,708 5,354,099 Mt. Province 280,262 238,223 40,674 20,336,905 Nueva Vizcaya 5,656 4,808 1,478 738,854 Central Luzon Bataan 65,234 55,449 36,096 18,047,860 Bulacan 1,150 978 11,415 5,707,066 Nueva Ecija 30,545 25,963 3,848 1,923,940 Pampanga 1,198 1,018 1,033 516,635 Pangasinan 25,858 21,979 22,836 11,417,799 Tarlac 6,192 5,263 5,147 2,573,612 Zambales 27,567 23,432 21,259 10,629,497 Southern Tagalog Batangas 12 11 Cavite Laguna 27,041 22,949 559 279,429 Manila 73,874 36,936,598 Marinduque 2,036 1,731 Mindoro Occ. 7,30 6,274 2,565 1,2P2,465 Mindoro Or. 92,804 78,883 30,437 15,218,473 Palawan 6,943 5,902 604 302,110 Quezon 92,578 78,691 41,995 20,997,415 Rizal 13,128 11,159 6,453 3,226,708

258 Table V-I (Continued)

A B Timber Production Lumber Production PROVINCE Cubic rietric Metric Board Metera Tons - Tons Feet Bicol Region ALbay 4,550 3,868 Camarines Norte 61,200 52,020 12,672 6,336,149 Camarines Sur 121,59L, 103,357 38,886 19,442,776 Catanduanes 1,540 1,309 183 91,.383 Masbate 4,361 3,707 Sorsogon 3,391 2,882 457 228,452 Eastern Visayas Bohol 1,817 1,544 Cebu 107 91 Leyte 27,992 23,793 9,512 4,755,996 Samar 18,772 15,956 4,181 2,090,086 Western Visayas Antique 435 370 Capiz 53 45 Iloilo 35 30 Negros Occidental 347,004 294,953 109,906 54,953,008 Negros Oriental 90,228 76,694 15,441 7,720,251 Romblon 1,671 1,420 No-thern and Eastern Mindanao Agusan 568,355 483,102 81,182 40,590,880 Bukidnon 8,550 7,268 440 219,886 Lanao 176,347 149,895 14,660 7,333,030 Misamis 0cc. 15,592 13,253 2,453 1,226,478 Misamis Or. 246,433 209,468 19,359 Surigao 9,679,626 250,322 212,774 17,348 8,673,803 Southern and Western Mindanao Cotabato 95, 589 81,251 7,588 3,793,870 Davao 155,069 131,809 29,752 14,875,580 Sulu 24 Zamboanga del Norte 61,076 51,915 )46,335 )23167196 Zamboungn del Sur 553,633 470,588 ) 3,

GRAND TOTAL / 3,6 3,161 31,0818,156 749,833 374,916,364

1/ Conversion factors: I cubic mcter = .85 metric tons. 1,000 board feet = 2 metric tons. 2/ Total of timber in metric tons may be slightly different from the total in cubic meters due to rounding of decimals.

Source: Bureau of Forestry manuscript records. 259 Table V-II

ESTIMATES OF TOTAL ACCESSIBLE FOREST (Volume by Province) 1952

Volume Accessible Corrected Volume Forest PROVINCE Forest Accessible Cubic Meters Cubic Metric~i Meters Tons

Ilocos Region Abra 2,268 1,588 1,349 Ilocos Sur 522 366 311 Ilocos Norte 1,636 1,146 974 La Union 371 260 221

Cagayan Valley & Mountain Province Baguio 21,561 15,093 12, 829 Cagayan 20,030 14,021 11,917 Isabela 29,264 20,485 17,412 Nueva Vizcaya 18,211 12,748 30, 835 Batanes 6 5 4

Contrail Luzon Bataan 3,461 2,769 2,353 Bulacan 2,164 1,732 1,472 Nueva Ecila & Cabanatuan 5,153 , 4,123 3,504 Pampanga 366 293 249 Pangasinan & Daguparr 2,513 2,011 1,709 Tarlac 1,826 1,461 1,241 Zambalc 11,037 8,830 7,505

260 Table V-II (Continuei)

Volume Accessible Corrected Volume PROVINCE Forest Accessible Forest-' Cubic Meters Cubic Metric V Meters Tons

Southern Tagalog Batangas & Lipa City 328 263 223 Cavite, Cavite & Tagaytay City '93 75 63 Laguna & San Pablo City 252 202 171 Marinduque 250 200 170 4indoro Occidental 12,299 9,840 8,364 Mindoro Oriental 8,649 6,920 5,882 Palawan 56,119 44,896 38,161 Quezon 28,130 22,504 19,128 Rizal, Manila, Pasay & Quezon City 1,468 1,175 998

Bicol Region Albay &Legaspi City 1,664 1,332 1,132 Camarines Sur & Naga City 11,518 9,215 7,832 Catanduanes 2,720 2,176 1,849 Masbate 3,262 2,610 2,218 Sorsogon 1,310 1,048 890 Camarines Norte 9,911 7,929 6,739

Eastern Visayas Bohol 2,147 1,718 1,460 Cebu and Cebu City 1,252 1,002 851 Leyte, Ormoc & Tacloban City 17,998 14,399 12,239 Samar 69,569 55,656 47,307

Western Visayas Antique 1,464 1,172 996 Capiz & Roxas City 853 683 580 Iloilo & 11oilo City 611 489 415 Negros Occidental & Bacolod City 20,369 16,296 13,851 Negros Oriental &. Dumaguete 14,888 11,911 10,124 Romblon 1,103 883 750

261 Table V-II (Continued)

Volume Accessible Corrected Volume Furest Accessible Forest PROVINCE Cubic Meters Cubic MetricE1 Ieters Tons

Northern & Zastern Mindannao Agusan & dutuan City 46,093 39,180 33,303 Misanmis Occidental & Ozainis City 3,236 2,751 2,338 Misamis Oriental & Cagayan de Oro 13,273 11,283 9,590 Lanao & Iigan City 2h,324 20,676 17,574 Surigao 38,217 32,485 27,612 Bukidnon 22,715 19,308 16,411

Southern & Western Mindanao Zamboanga del Norte & Zamboa-nga City 62,503 53,128 45,158 Zamboanga del Sur & Basilan City 62,083 52,771 44,855 Davao & Davao City 71,117 60,450 51,382 Cotabato 87,400 74,290 63,146 Sulu 4,323 3,675 3,123

1/ Corrections made by forestry experts in 1956 with reductions as follows: Ilocos Norte and Sur, Cagayan, Isabela, Nueva Vizcaya, Negros Occidental and Oriental, 30%; Mindanao Provinces 15%; remainder of Philippines 15%. 2/ Conversion factor used: 1 cubic motor = .85 metric tons.

Source: Bureau of Forestry, "Table Showing by Provinces the approximate Area, Volume, and Allowable Timber Cut in Potential Agricultural Lands, Production Forest, and Mangrove Swamps in the Philippines, July 1, 1952," Column 31.

262 Table V-III

LUMBER AND LOG RECEIPTS, MANILA (Based on Approximately 40% Sample) 1954-1955 Total Less and LuAber Transported by Boat Transported by RAil- Transported All Forms Transport lmaber Lumber b TrucL Lumber OrIginating Loge lid.Ft. Total Id. Ft. lo M Bd. ft. Loge Total Region and Province Cu. M. U. T. 000 Omitted M. T. M. T. 000 Omitted M. T. Cu. M. M. T. 000 Omitted Cu. M. M. T.

Northern Laon

Dataan 2,991 2.342 650 1,700 4,242 12,464 10,595 850 15,455 14,837 Caraynn 42 36 451 002 038 415 353 451 458 1,291 lesbelsa 3.707 3,151 3,707 3,151 77 66 77 60 Pspange 95 s Zembeles 246 492 492 7,098 6,033 246 7,098 6,525 Rival 263 223 263 223 twsine" 95 81 95 15 MruntaIn Province Is IS 1S 15s

Subtotal 3.033 2,878 1.,547 3,U94 5,872 24,233 20,598 1,547 27,260 26,270

Southern tuon

Laguna 357 304 357 304 Casartnes Norte 3,334 2,834 1,973 3,946 8,780 628 1,256 2,601 3,334 6,038 Cemarines Sutre 8,919 7,581 134 268 7,849 11,413 22,625 11,547 6919 30,675 Queson 451 383 348 600 1,079 10,31 21,963 11,179 451 22,742 Mindoro 257 218 15,728 31,459 31,674 15,728 257 31,674

Subtotal 12,961 11,017 18,183 36,366 47,383 22,872 45,744 357 304 41,055 13,318 93,431

Visayas

Palawan 348 296 0 12 308 6 348 308 Negros Oriental 520 1,040 1,040 520 1,040 NKegrosOccidental 44 88 88 44 88 Leyte 77 184 154 77 104

Subtotal 348 296 647 1,204 1,590 647 348 1,590

Mindanao

Aguman 209 229 20,368 40,737 40,067 20,388 269 40,967 Surgeo 113 220 228 113 226 Davao 2,412 4,824 4,824 2,412 4,824 Cotabato 1,586 1,348 1.348 1,586 1,348 tnao 1,380 2,760 2,760 1,380 2,760 Zamboanga del Norte 1,484 1,261 547 1,094 2,355 547 1.484 2.355 ZEaboanga del Sur 700 55 1,468 2,032 3,527 1,466 700 3,527 11,812 10,040 4,987 20,014 4.957 11,812 20,014

Subtotal 15,851 13,473 31,273 62,547 76,021 31,273 15,851 78,021

Total of Sample as Allocated to Provinces 32,193 27,364 51,650 103,301 130,66 22,812 45,744 24,890 20,902 74,522 56.784 197,312

Total Shipuent (as reported by Phil. LumberProd. Ass'n., Including amounte not allo­ cated to province.) 43,119 36,651 586,772,763113,645 150,196 24,133,677 48,267 24,590 20,902 80,800,440 67,710 219,3685

Note: Detail ay not add to totals due to rounding. 1/ It is apparent, on basis of total luaberproduction In Manila, as reported by the Bureau of Forestry, and ManilaRailroad receipts, that these figures represent only about 40 percent of all receipts at Manila. 2/ No log receipts by rail reportedyet data from Manila Railroadindicate that an estimated10,000 tons of log arrivedIn Manilamostly from Camarines Sur; the same data Indicatethat about 75,000 tonsof lumbercam In,with perhaps half thisvolume from Camarines Sur. 3/ No lumber receiptsby truch reported, although exportsin trade eatimate that perhaps as much lumber comes In by truck as loge. Conversion Factors: I cubic motor . 425 board feet or .85 metric tone.

1,000 Rd. Ft. - 2.354 cubic enter of 2 metric tone. I metricton . 500 Dd. Ft.

Sources Compiled from monthly statements of "Arrivals of lWeber and Logo In Manila," by name of shipper, Philippine Lumber Producer's Association$ Manila. Not all shipper# location on these lists could be ascertained. Shippers location obtained through courtesy of Mr. Ralph Dempsey and Mr. Dee Cho, ManIla, and from the Dureau of Forestry "List of Sawmills." Percentage of ahipments located as follows:

ship Rail Truck Lumber 90.97% 94.77% Timber 74.60 - 100%

263 Table V-IV

SELECTED TIMBER AND LUMBER TRANSPORT RATES, 1956

Lumber Logs Rate Per Ton Km.

Distance 1000 Bd. Ft. M. Ton* M. Ton Lumber Logs Kas. Pesos Pesos Pesos Pesos Pesos

RAIL Sipocot, Camar­ ines Sur to Manila 341 24.50 12.25 12.25 .0359 .0359 Naga City to Manila 378 26.25 13.13 13.00 .0347 .0343 Del Gallego to Manila 287 20.75 10.33 10.25 .0359 .0357 Tagkawayan to Manila 278 20.10 10.05 9.75 .0361 .0350 Calauag, Quezon to Manila 244 18.00 9.00 8.75 .0368 .0358 Hondagua to Manila 237 17.35 8.68 8.75 .0366 .0369

SHIP I. Actual Rates Reported by Shippers mid 1956 for Interisland Ships Northern Luzon (Claveria-Aparri) to Hongkong 820 24.50 12.25 .015 Northern Luzon (Aparri-Claveria) .0211­ to Manila 710 30-50 15-25 .0352 Zamboanga to Manila (regular interisland, unavailable) 949 45 22.50 .0237

* Conversion factor: 1000 board feet = 2 metric tons.

264 Table V-IV (Continued)

SELECTED TIMBER AND LUMBER TRANSPORT RATES, 1956

Lumber Logs Rate Per Ton Km.

Distance 1000 Bd.Ft. M.Ton* M.Ton Lumber Logs Kms. Pesos Pesos Pesos Pesos Pesos

SHIP I. (Continued) Zamboanga to Manila (spec­ ial charter) 949 60 30.00 .0316 Nasipit, Agusan Mindanao to 13.60*. .011*L .015**.. Manila 914 20*24: 10*;12 15.30 .013 .017 Bislig Bay (Mindanao east coast) to Hongkong c.1,880 28 14 .008 Bislig Bay (Min­ danao east coast to Manila (when available) c.1,070 39 19.50 .018 Lianga Bay to Manila (regu­ lar interisland; unavailable) c.1,040 38.50 19.25 30 .018 Calapan, Mindoro to Manila 191

* Conversion factor: 1,000 board feet = 2 metric tons.

** Rate on favorable regular contract (with same ship owner as lumber shipper) guaranteeing to fill up ship.

265 Table V-IV (Continued)

SELECTED TIMBER AND LUMBER TRANSPORT RATES, 1956

Lumber Logs Rate Per Ton Km.

Distance 1000 Bd.Ft. M.Ton* M.Ton Lumber Logs Kins. Pesos Pesos Pesos Pesos Pesos

SHIP II. Rates quoted by Interisland Ships mid 1956. (Cargo may not be picked up) Davao to Manila (stevedoring extra) 1,434 25.00 12.50 .0087 Butuan, Agusan .0099­ to Manila 914 18-20 9-10 .0109 Isabela, Basilan Island to Manila 960 19.20 9.60 ,01 Surigao to .013­ .034­ Manila c. 850, 22-29 11-14 29-30 .017 .035 Tacloban to Manila c. 680 17**-29*** c.10 c. 016

III. Barge, LCT, Scow. Rates reported by shippers Bislig Bay to Manila (Scow) .013­ Charter 1952 c.1,070 28-30 14-15 .014 Bislig Bay to .021­ Cebu (LCT) c. 420 18-22 9-11 .026

* Conversion factor: 1,000 board feet = 2 metric tons. ** Light weight wood. Heavy weight wood.

266 Table V-IV (Continued)

SELECTED TIMBER AND LUMBER TRANSPORT RATES, 1956

Lumber Logs Rate Per Ton Km.

Distance 1000 Bd.Ft. M.Ton* M.Ton Lumber Logs Kms. Pesos Pesos Pesos Pesos Pesos

SHIP III. (Continued) Mati-Davao (Special) 204 24 12 .059

TRUCK Northern Luzon (Claveria) to Manila 597 80 40 .067 Claveria-Laoag (Bad road, small trucks) 106 40 20 .189 Laoag-Manila (Good road, large trucks) 487 40 20 .049 Bataan-Manila c.130 18 Sta.Cruz, Masin- CENTflALE~lE 9IRR 10c, Zambales to Manila c.280 c.30 CO&IUNICATIONS R'NEDRA 18WSION Baler, Quezon AID/M ANILA to Manila (Very bad road for c.50 kms. from Baler) c.200 c.60 c.30 c.15 Santiago, Isabela to Manila 354 80 40 25.15 .11 .071 (Square)

Note: Handling and truck rates from pier, North Harbor, Manila, to lum­ ber yards in city: 015 per 1000 bd. ft. (c.V7.50 per metric ton). Truck rates from railroad to lumber yards in Manila: P2.50-)4.50 per metric ton. * Conversion factor: 1,000 board feet = 2 metric tons. Source: Data compiled by Stanford Research Institute from interviews, shippers, carriers, and government personnel.

267 Section VI

MINERAL PRODUCTION, INCLUDING CEMENT AND FERTILIZER

C I PREVIOUS AE Section VI

MINERAL PRODUCTION, INCLUDING CEMENT AND FERTILIZER1/

Mineral production is found throughout the Islands, but there are only a few large producers who are generally located close to the coasts. These producers ship out most of their output to the nearest private landing for export overseas and thus do not contribute significantly to domestic transportation flows. Production of minerals is increasing, however, and prospects for increases at scattered places throughout the islands are good. This production coupled with increasing emphasis on domestic processing and manufacturing presumably will increase the de­ mand for domestic transportation, particularly for economical methods of interisland movement.

Cement

One of the most important contributors to domestic transportation is the cement industry, all of whose product is distributed within the islands. Practically all of the coal produced is also consumed by the cement industry. Four cement plants, each with its own adjacent lime­ stone quarry, operate, and a fifth is under construction. (See Figure VI-25 and Table VI-I.)-

Cebu Portland Cement Co., run by the government, at Naga some 20 kilometers south of Cebu City, is the largest, producing over 200,000 metric tons in 1955. Limestone is obtained from company quarries at the plant, and coal by trucks from the nearby mines of Danao and Argao, and from the Malangas area of Zamboanga del Sur by water to the company pier. Most of the finished product is shipped in bags via contract trailer to Cebu City and then distributed via interisland steamer and barge throughout the country.

1/ Sources: E. M. Irving, Mining Division, ICA; Philippine Bureau of Mines Statistics of Mineral Production-1955, and other sources as noted. For detailed statistics of production by mines see Table VI-I at end of this section. 2/ The tables.for Section VI will be found at the end of the section.

. 271 FIG. VI-25 NONMETALLIC MINERAL PRODUCTION (INCLUDING CEMENT AND FERTILIZER) 1955

272 The next two largest plants are Rizal Cement (near Manila, c. 130,000 metric tons) and Bacnotan (Government plant north of San Fer­ nando, La Union, c. 110,000 tons). Bacnotan obtains coal from Malangas, Zamboanga del Sur, and ships out finished product principally by truck and rail to Manila and northern Luzon. Rizal's biggest market naturally is the Manila area. It operates entirely on imported bunker fuel.

The fourth plant, Philippine Portland Cement on Guimaras Island, near Iloilo, produces only about 30,000 tons. Fuel is entirely im­ ported bunker oil and market is principally Panay and neighboring area.1/

The largest plant of all (400,000 tons), Republic Cement Co., is under construction at an inland site at Norzagaray in Bulacan, 28 kilo­ meters from Manila and advantageously located to serve the main Manila market.

Coal

Coal production is only 130,000 metric tons and is confined princi­ pally to mines in three areas: Danao (approximately 35 percent of Philippine production) and Argao (23 percent) both on Cebu, and Malangas with the best coal (c. 12,500 BTU), in Zamboanga del Sur, western Minda­ nao (36 percent). Malangas has some coking coal (c. 2,000,000 tons esti­ mated reserve) which might be the base for some small-scale metallurgical developments in the future at Iligan or other points especially if the coking coal, the only known deposit on the islands, is not all consumed by the cement industry.

Other Nonmetallic Mineral Production and Fertilizer

Pyrites and Fertilizer

The most important other nonmetallic movements, especially in the near future, are pyrites from Rapu-Rapu Island, near Legaspi in southern Luzon, to Iligan for use in fertilizer production. They are being shipped by barge or interisland vessel in increasing quantities. Con­ siderable quantities are also expected to be produced from the Atlas Mine in Cebu to be taken as a by-product from the ore after copper con­ centrates have been removed. Some fertilizer production will also be

1/ In addition the Philippines imported a total of 69,951 tons of cement in 1954, and 40,110 in 1955 (Central Bank).

273 undertaken at Atlas. In addition, a small amount of sulfur comes from Camiguin Island off the northern Luzon Coast. Production of pyrites has large potential, from existing mines and new mines soon to be brought into production, if and when markets become available, especially ex­ port markets.

Production of fertilizer at Iligan was 37,000 tons in 1955 with capacity at 50,000 and expansion to 100,000 tons planned. This will in­ crease the demand for pyrites from Rapu-Rapu and elsewhere. In 1955, about 30,000 tons of fertilizer were shipped to Negros for the sugar industry which could have used far more, aad had to meet its other re­ quirements from imported fertilizer. In 1956 and in the future Iligan's production will be distributed more widely, with only a small amount going to Negros. All fertilizer is shipped in bags, not in bulk. Ex­ pansion of production to 100,000 tons is estimated to take care of about one-half present Philippine requirements.

Actual and planned production of fertilizer in the near future will be approximately as follows:

National Power Co., Iligtan, Mindanao (ammonium sulphate, etc.) 100,000 tons

Atlas at Sangi, Toledo, Cebu (superphosphate and triple superphosphate) 65,700 tons

Chemical Industries Plant--Malabon, Rizal (superphosphate) 18,000 tons

Total 183,700 tons

Remaining needed to be imported under present or near future conditions will be some 35,000 tons of potash component and perhaps 6-16,000 tons of nitrate (urea).- Some phosphate will also need to be brought into the Atlas plant at Sangi. It has also been suggested that perhaps four compounding or mixing plants might well be set up to which fertilizer components produced above would be sent and from which the mixed ferti­ lizers might be distributed to the surrounding areas: Dagupan or

1/ Ananias Diokno, Jr. "Plans for an Integrated Philippine Fertilizer Industry," Journal of Soil Science Society of the Philippines, Vol. VIII, No. I, 1 pp. 27-43; also interviews with Mr. Trinidad, Manager, N.P.C. Fertilizer Plant, Iligan.

274 San Fernando (La Union) area, Luzon; Manila; Sangi in Toledo, Cebu; and Iloilo. Each plant might have a capacity of 50-60,000 tons. In the future fertilizer requirements will rise, perhaps eventually to 4-5 times present reuirements, or 850,000 tons, depending on assumptions and conditions.-

Miscellaneous Nonmetallic Minerals

Other nonmetallic mineral movements are minor (Figure VI-26 and Table VI-I). Silica sand (c. 30,000 tons) moves from Palawan to Manila by barge for glass manufacture. A small amount of rock asphalt is also produced in Leyte, but is declining in production. Scattered amounts of lime and salt from sea water are produced widely and distributed locally. The largest salt establishment is Manjuyod, Negros Oriental, producing about 4,000 tons a year. Under consideration is the establish­ ment of a 50,000-ton plant in Western Mindoro to provide industrial salt, which now must be imported for the chemical industry. Clay prod­ ucts (bricks, tiles, pots), sand and gravel, stones, and the like are also widely produced but their transportation, as in most countries, is limited to local movement; the products are so heavy and cheap that they cannot stand high transport charges.

Base Metal Production

Iron and Chromite

The largest mineral production in tonnage is iron, followed by chromite ore. Largest single producer is the Philippine Iron Mines at Larap (1,043,000 tons) on the coast of the Paracale district of Cama­ rines Norte (Figure VI-26). It has its own pier only one to three kilometers from the mines served by its own narrow gage railroad. Bulk handling facilities, however, are poor. Next largest is chromlite ore of Consolidated Mines at Masinloc, Zambales, Luzon (535,000 tons) and nearby Acoje Mine (59,000 tons). Samar Mining (208,000 tons) on eastern Samar (which is nearing the end of its ore supply) and Marinduque on Marinduque Island (181,000 tons) are the other large iron ore producers. Atlas Consolidated has just completed a pier and road for an iron mine near Mati in southeastern Mindanao, for handling 180,000 to 250,000 tons

1/ Ananias Diokno, Jr., op. cit. pp. 27-43.

275 -Legend-

EMPLOYEES 100,000 000 6000 . 50,000 125000

1000 ACTUAL PLANNED

300 NOTE: LESS THAN 5,000 TONS NOT SHOWN * LESS THAN 100

CHROMITE

IRON

MANGANESE

0

FIG. VI-26 BASE METALS PRODUCTION 1955

276 ore production per year for export in the near future. All of these .nes are close to the sea with their own private short roads or rail­ )ads to the nearest coastal point for export. The Samar Iron Mining )., however, is planning to construct a road or railroad near Sibuguey, mboanga, in southwestern Mindanao some 35 or 40 kilometers inland from Le coast to bring out 200-250,000 tons of iron ore per year.

Copper and Other Ores

Two sizeable copper mines round out the picture of large mineral -oducers: Atlas at Sangi, Toledo, Cebu (30,000 tons), already men­ .oned in connection with possible pyrite and fertilizer production, .th its own bulk pier 17 kilometers from the mine on the east coast of ,bu, and Lepanto, in the interior of Mountain Province, Luzon (57,000 ris). Both mines are increasing output and both ship out copper con­ ,ntrates, Atlas to Japan and Lepanto to Tacoma, Washington. (Atlas, ,cording to some estimates.'ill produce 200,000 tons a year and in July 136 announced plans for a smelter-rofinery at Sangi to process its own ncentrates, instead of shipping to Japan; for more details, see con­ .usion). Lepanto is the farthest inland of any large mine in the tilippines, necessitating a long truck haul over mountain roads through iguio to San Fernando, La Union. Only relatively small trucks can be ;ed and the rate is high but the value of the concentrate is such that can stand the cost. 1-

At Bagacay in central Samar, the Marinduque Iron Mining Co. is )veloping copper and some iron deposits for production in 1957 esti­ ited at some 150-250,000 tons of export per annum. The mine, although iland, is close to the cross-island National Road. Pier facilities, )wever, will need to be constructed on either the east or west coast. ie west coast is sheltered and has easy access to possible smelters on -bu or elsewhere, but is very shallow. The east coast has deep water id easy access to foreign markets but not as good to domestic smelters. i initial shipment has just been made through Taft on the east coast. Sipalay, in southern Negros Occidental, the Marinduque Company is also veloping a large copper deposit planned for production sometime in 1957.

Copper concentrate valued at ?160 per ton,costs,through contract hauler, 22 pesos per ton (in 6 ton trucks) for a distance of 150 kilometers, or about 14.7 centavos a ton per kilometer, or 23.3 centavos (11.7 cents) a ton mile, a very high rate for a bulk commodity. By contrast, the rate per ton on the ocean to Tacoma is only $5.00, a very low rate.

277 Small amounts of lead, mercury, and manganese production are scat­ tered over the Islands (Figure VI-26). For this production, and other base metals, employment is also shown as an indicator of the size of the mines and the imports of supplies required.to run the mines.

Gold and Silver Mining

Gold and silver, especially the former, have long been one of the mainstays of Philippine mining, even now accounting for more than one­ quarter of the value of all estimated mineral production and more than half of the value of all metallic minerals. Output in tons, however, is negligible and consequently demand for transportation created by the output is of no consequence. However, the mines do import supplies-­ machinery, dynamite, wood, fuel, food, etc., and to this extent need access, although the volume thus consumed is neglibigle compared to the tonnage output of a large iron mine or cement plant. Cold mines are indicated on Figure VI-27 by circles proportionate to number of employees. By far the greatest concentration is in the Baguio area, particularly the Benguet Consolidated, and Balatoc Mining Companies, with about 6,000 employees together. Prospects for new mines are considered good through­ out Mountain Province, including isolated Apayao and Kalinga. If mines were opened they would also open up this isolated country and help the inhabitants. The low price of gold discourages new ventures, however. In addition, Atlas, and particularly, Lepanto copper mines produce sig­ nificant amounts of gold, but are not shown on the gold and silver map (Figure VI-27), inasmuch as the bulk of their employment is concerned with copper (See Figure VI-26).

Conclusion: The Role of Transport and Future Mineral Prospects

Since most mineral production is practically on the sea coast-and the product is exported overseas, except for cement and fertilizer, do­ mestic transportation improvement would have little effect on increasing production, especially for export and foreign exchange. Furthermore, the local, short length of haul from mine to coast, as well as the specialized, one-producer use of shipping facilities, does not represent a suitable or normal use of general government funds for improvement or maintenance, but rather represents a reasonable charge and responsibility against the one beneficiary.

If or when significant mineral deposits are unearthed in the more distant interiors of some of the larger islands, the question may arise as to the desirability of the government improving road or other

278 -La gond­

6000 1000

3000 6 300

® SMALL ORINCLUDED IN OTHERPRODUCTION

0C?

0

C00

FIG. VI-27 GOLD AND SILVER MINING (EMPLOYMENT) 1955

279 facilities to enable the product to move to the coast, especially if the improved transportation will also serve a general need for other groups of the population, as may be the case for a longer road opening up or serving more territory because of its length. Roads may also encourage interior prospecting and future development, but this is a gamble. Like­ wise, if sufficient quantities of minerals are found around some port, the question may arise as to gcvernment encouragement for construction of one or more large, centralized bulk handling marine terminals, facili­ ties which are now largely absent in the Philippines and whose absence raises handling costs for competitive export business. In any case ex­ ploitation of miLnerals for export which are some distance from the coasts may be costly in competition with possibl3 producers at or near tidewater in other parts of the world.

Nevertheless it is reported that some mining enterprises are de­ terred from starting development because of the cost of constructing access roads and transport facilities, whereas in more developed areas these facilities might be provided in greater part. Possibly the govern­ ment might build roads in certain cases, to be repaid by a royalty or toll on the tonnage moved out of the mine. Such development might be feasible where additional purposes would be served by the road or where it fitted into a general building plan for the near future and where the prospects for mineral production were bright enough to warrant the in­ vestment. This would require careful investigation and certification by the government working through qualified experts, such as the Bureau of Mines. The safest and simplest certification, of course, is the present method,. if the prospects for mineral recovery appear suffici­ ently good, then the private investor is willing to risk capital to build the access road or to make a good enough case so that a bank or govern­ mental development agency will lend the money. In some cases, however, some sort of royalty or toll arrangement might actually benefit the government by enabling it to make a user charge on an existing or planned road which the government or general public might otherwise maintain and thus subsidize a mining operation which could afford to pay for its benefits.

Future Mineral Prospects

Future mineral possibilities are considered excellent in many areas scattered throughout the Philippines, but as is generally the case any­ where in the world difinitive predictions of large strikes are difficult. However, many small and several large mines are now being actively planned and developed, the larger and most advanced ones being mentioned in the preceding text. Much prospecting remains to be done but energetic

280 efforts are being made. The heavy soil mantle and dense vegetation make much geological work slow. In addition many areas in inaccessible mountain regions, even in nearby Mindoro, have not yet been-explored, so that possibilities are unknown.

Surigao Nickel Ores. The largest potential ore reserves known are the complex nickel-iron ores of Nonoc and Dinagat Islands off northern Mindanao. Reserves are large, estimated at from 500 million to a bil­ lion tons, larger than deposits of any other mineral known in the Philip­ pines. Open pit mining could be used. By the end of 1956 it is ex­ pected that processes will have been tested for exploitation; prospects are brightfor technical solution of the problem of separating out the nickel, about 1.38 percent of the ore. The process would be about 80 percent efficient and similar to that used at Nicaro, Cuba, on ores of even lower nickel content.

Capital for a smelter on one of the islands, at an estimated cost of $100,000,000 and other arrangements would still have to be met. De­ mand for nickel is high, however, and is increasing with only one large source, Sudbury, Canada, now serving the world.

The process apparently most likely to be used might involve handl­ ing 3,000-10,000 tons of ore a day; at 1.38 percent nickel metal re­ covery, 80 percent efficiency, this would produce about 30 to 110 tons of nickel a day or about 10,000-40,000 tons a year. The biggest input in the process would be fuel oil, with one ton requiring 5-7 gallons for initial reduction rnnct plus small amounts later in the process. Treating 3,000 to 10,000 tons of ore a day would thus require about 15,000-70,000 gallons of fuel oil (75 to 250 tons a day or 30,000 to 70,000 a year). The other large input would be anhydrous ammonia, which is most cheaply produced as a by-product of petroleum refining. Thus there could be significant inbound movements from a refinery, per­ haps sufficient to influence the location of a projected new refinery in the Visayas at Cebu or elsewhere. Total estimated employment under the process at the islands might be 3,000 to 5,000 which together with service workers and families, would generate some general cargo move­ ments inbound of supplies.

Left over after nickel extraction would be large amounts of iron ore of 42 to 52 percent iron, combined with chrome, cobalt, and other metals. The problem of separating this ore to be serviceable is one which might well be solved by application of extensive research. If solved, considerably larger amounts of iron ore would be available for export to Japan, as well as providing additional amounts for possible

281 domestic blast furnaces. In this case the iron and steel manufacture would not be apt to occur at ore sources, since they have neither coal nor water for generation, but rather near Iligan or some other power source.

Other Mineral Areas. Two other active exploitation areas are: (1) the Zambales Coast of Western Luzon with several copper and 'chrome properties under development, and (2) the Paracale district on south­ eastern Luzon with several copper and iron properties in the vicinity of Larap and Mambulao. In both these cases some extra and better equipped piers will be needed to handle the ore export efficiently. Other areas in the Philippines are also active or potential--Tarlac, east of Zambales in Central Luzon with chrome, and several parts of Mindanao and other islands as already noted. In Ilocos Norte a deposit of iron ore at Lamin, 35 to 40 kilometers inland from Laoag, is reported not developed because of lack of a deep water pier.

The Cagayan Valley of northern Luzon and neighboring area, however, is covered with heavy sedimentary deposits and hence is not considered a likely place for many types of mineral exploitation, although one iron ore prospect is known at Camalaniugan, 11 kilometers from Aparri. Oil prospects are also possible and deep drilling is already underway with signs of gas, but no oil in recoverable quantities yet found. Other drilling is planned. The northeast coast of Luzon, east of the Cagayan Valley, is high and rugged and virtually unexplored with practically no settlement. Minerals, if any, which might be found in this difficult area might well be shipped out to the nearby coast, rather than through the Cagayan Valley, because of the rough mountain divide to be crossed, as well as the nearer distance to the coast; the coast, however, is exposed to heavy seas and has no adequate harbors.

Domestic Mineral Transport

In considering domestic production and consumption of minerals and related end products, improvements in transportation facilities or handl­ ing undoubtedly would increase efficiency of production along with cheapening distribution. The most important domestic production, cement, however, is produced at or close to the coasts and close to domestic mar­ kets, because limestone, the principal raw material is so abundant and widely distributed in the Philippines. Bulk hauling of cement by barge, truck, and by rail on Luzon, as has recently developed elsewhere in the world, might materially reduce costs where volume is sufficient. Volume to Manila and a few other strategically located depots should develop

282 and could form the basis for such improvements. The same would appear desirable in'shipment of fertilizer components, especially from the plants to the mixing or compounding stations suggested earlier, if they materialize. Likewise, if sugar is handled in bulk from Negros, ferti­ lizers might be brought in the same manner to this high consuming area, and bags and handling costs saved.

Various schemes have been suggested for producing basic iron and steel from ore and for utilizing the electric power at Iligan in various ways.- If they materialize, bulk methods of shipping ore and coal by barge or special carriers will be essential to assemble the quantities needed for economical production. Steel production at present is small, with some in Manila from local scrap and about 18,000 tons a year of reinforcing rods at Iligan, all produced from Manila Bay scrap in a 10-ton a day electric furnace. It is planned to put in a new 25-ton a day electric furnace by March, 1957 to increase capacity to three and one-half times present production, with similar increase in amount of scrap brought in (65 tons for every 50 tons of finished product). With this or greater volume, efficient methods of handling scrap in bulk should also be investigated. One plan, for example, calls for construc­ tion of a 100,000-ton per year plate mill at Iligan by mid-1959 using as charge 60 percent ore (from Marinduque, Zamboanga, and possibly Bicol as well as other places) and 40 percent scrap (presumably mostly from Manila).

According to Bureau of Mines experts some 300,000 tons of copper concentrates will be produced in the next few years, enough for a smelter. Atlas Consolidated in July 1.956, announced plans to build a smelter refinery at Sangi, Toledoits port for copper mining in Cebu. Some 120,000 tons of concentrate a year are expected in the future, with some estimates indicating more than 200,000 tons eventually; ad­ ditional amounts may be obtained from other properties on other islands in the neighboring Visayas. The location was chosen to be central to

1/ For example some 200,000 to 250,000 tons of iron ore will be mined at Sibuguey by 1957, about 35 miles inland from the south coast of Zamboanga del Sur and not far from the coking coal now being mined at Malangas, with a possible reserve of some 2,000,000 tons. These two sources might be combined nearby for a basic iron and steel smelter; more likely the raw materials would be moved around by sea to Iligan where relatively cheap electricity might be applied to the process. Limestone, the third raw material is widely available.

283 such future production in order to minimize transport costs, which at present are very high by general cargo interisland steamers.

The principal improvement in domestic transportation of minerals and related raw materials thus would be extension of bulk handling and shipping to cut down handling and container costs. Such improvements would apply principally to water transportation, but also to a lesser extent to land transport and in some cases to general improvements of road surface to enable bulk carriers to operate. The introduction of such methods will depend on future generation of sufficient volume to warrant the practice, with some commodities, notably cement, probably being in or close to such a position now.

284 Table VI-I

MINERAL PRODUCTION INCLUDING CEMENT AND FERTILIZER 1955

Value, Pesos Approximate Production (metric tons) (000 Omitted) Employment Remarks

I. Cement

Cebu Portland Cement, Naga, Cebu 200,000 (1,006,625 bbls) 0F13,067 Bacnotan Cement, Bacnotan, L.U. 110,000 ( 549,771 i ) 7,096 Rizal Cement, Rizal 130,000 ( 686,962 "9 ) 9,296 Philippine Portland Cement,

Guimaras Is., Iloilo 30,000 ( 153,315 "' ) 2,045

00 Total 470,000 (2,396,673 "I ) 31,504

Under Construction Republic Cement Co., Norzagaray, Bulacan 400;000 (2,000,000 i ).

II. Coal (Principal Mines)

Danao, Cebu c. 45,000 Argao, Cebu c. 30,000 Malangas increas­ Malangas, Zamboanga del Sur 47,000 ing; rate to May Other Mines 8;243 1956 50%above 1955 Total (all mines) 130,243 3,104 Table VI-I (Continued)

MINERAL PRODUCTION INCLUDING CEMENT AND FERTILIZER 1955

Value, Pesos Approximate Production (metric tons) (000 Omitted) Employment Remarks

III. Fertilizer and Pyrites A. Fertilizer Components

National Power Co., Iligan City, Misamis Oriental 37,000

Planned

Wb~3 o0 National Power Co., Iligan City, Misamis Oriental 50,000 ­ 100,000 ultimately Atlas, Sangi, Toledo, Cebu 65,700 Chemical Industries, Malabon, Rizal 18,000

B. Pyrites

Total (Mostly from Rapu-Rapu Island, Albay) 30,782 1797

Planned

Rapu-Rapu Island, Albay and Atlas, Sangi, Toledo, Cebu New Production

C. Sulphur

* Total (Camiguin Island - No. Luzon) 7,134 196 Table VI-I (Continued)

MINERAL PRODUCTION INCLUDING CEMENT AND FERTILIZER 1955

Value, Pesos Approximate Production (metric tons) (000 Omitted) Employment Remarks

IV. Other Nonmetallic Minerals

Silica Sand

Del Pilar, Palawan 30,782 P 508 Rock Asphalt

. Total (All from Leyte) 3,250 83 In addition other nonmetallic minerals (but quanti­ ties are generally not reported in tons) are produced as follows:

(1) Clay products - pottery, bricks, tiles, etc. 553 (2) Construction materials ­ adobe, sand and gravel, crushed rock 5,803 (3) Limestone ­ for agricultural and industrial purposes and other uses 909 (4) Salt from sea water, etc. 3,914

V. Base Metals

A. Iron

Philippine Iron Mines, Larap, Will increase;20 Camarines Norte 1,043,312 17,415 2,500 yrs. reserve proved, Samar Mining, MacArthur, Samar 208,350 3,520 600 probably more, Marinduque Iron 181,050 3,104 500 Will exhaust ore in Total 1,432,712 p24,040 2-3 years Table VI-I (Continued)

MINERAL PRODUCTION INCLUDING CEMENT AND FERTILIZER 1955

Approximate Production (metric tons) (000 Omitted) Employment Remarks

V. (Continued) Planned

Samar Iron Mines, Sibuguey, Zamboanga del Sur 200-250,000 Under Corstruction Atlas Consolidated, Mati Davao 180-250,000 Production in 1957 Camarines Norte (1 or more mines)

B. Copper (Concentrate production c. 20% copper; principal mines)

Lepanto Consolidated, Mountain Province c. 57,000 019,131 1,100 Will increase Atlas Consolidated, Sangi, Increase to Toledo, Cebu c. 30,000 10,385 700 c. 200,000 Masara Consolidated, Davao c. 200 72 500 Other Mines c. 570 207 By product from mines, Total gold Other Mines c. 88,000 y29,795 Planned (In addition to increase present producers)

Bagacay, Samar 150-250,000 Includes more Sipalay, Negros Occidental Substantial production Production in 1957 Zambales (several mines) planned Mindanao Motherlode (Cabapa Copper) Botolan Copper Project Table VI-I (Continued)

MINERAL PRODUCTION INCLUDING CEMENT AND FERTILIZER 1955

Value, Pesos Approximate Production (metric tons) (000 Omitted) Employment Remarks

V. B. (Continued)

Hixbar Gold Mines (Copper and Pyrites) Philex, Mountain Province Angaki, Mountain Province Camarines Norte (1 or more mines)

I3 C.Lead (Concentrate, c.50% lead; principal mine) Surigao

Consolidated, Surigao C. 360O0 P 1,118 1,000 By product

Total (All Mines) c. 4,636 1,426

D.Chromite

Consolidated Mines, Masinloc, Zambales 535,262 16,145 1,000 Increasing Acoje Mining, Zambales 59,745 3,130 700 Increasing Luzon Stevedoring Chromite, Misamis 3,110 145 50

Total (Ref. and Met. Chromite Ore) 595,007

Planned

Palawan Consolidated Mines, Irohuan, Palawan Table VI-I (Continued)

MINERAL PRODUCTION INCLUDING CEMENT AND FERTILIZER 1955

Value, Pesos Approximate Production (metric tons) (000 Omitted) Employment Remarks

V. (Continued) E. Manganese

General Base Metals, Guindulman, Bohol 8,013 r311 200 Laur Manganese, Nueva Ecija 468 26 25 Luzon Stevedoring Manganese, Tarlac 2,431 149 50 Palawan Manganese Mines, 0 Busuanga Island,Palawan 1,000 74 25

Total 11,912 16560

F. Mercury

Palawan Quicksilver, Puerto 635 - 76 lb. flasks Princesa, Palawan (negligible tonnage) 357 150 Increasing Table VI-I (Continued)

MINERAL PRODUCTION INCLUDING CEMENT AND FERTILIZER 1955 Production Value, Pesos (000 Omitted) Approximate (Gold @ 0104.65/oz. troy) Employment Remarks

VI. Gold and Silver

Baguio Gold Mining Co., Mountain Province Gold 2,752 700 Silver 17

Balatoc Mining Co., Mountain Province Gold 10,673) ( -­ Silver 144) (6,000 Benguet Consolidated, Mountain Province Gold 12,354) ( - Silver 166 ( - t~3 Itogon Mining, Mountain Province Gold 3,673 1,000 Silver 23 Paracale-Gumaus, Camarines Norte Gold 117 200 Gold, silver, copper Silver 5 lead producer; San Mauricio, Camarines Norte Gold 2,270 Closed 1956 Silver 88 Ukab, Surigao Gold 19 Virtually inactive Silver * Coco Grove, Camarines Norte Gold 806 50 Silver 2 Heide Lang Placer, Surigao Gold 42 25 Closed 1956 Silver - Table VI-I (Continued)

MINERAL PRODUCTION INCLUDING CEMENT AND FERTILIZER 1955

Production Value, Pesos (000 Omitted) Approximate (Gold @ 0104.65/oz. troy) Employment Remarks

VI. (Continued)

Additional Mines Already Listed Under Other Production

Atlas Consolidated, Sangi, Toledo, Cebu Gold 430 700 Mostly copper Silver Lepanto Consolidated, Mountain Province Gold 4,923 1,200 Mostly copper Silver 283 Masara Consolidated, Davao Gold 153 600 Mostly copper Silver 18 Surigao Consolidated, Surigao Gold 5,649 1,000 Mostly gold; lead Silver 107 is heavy tonnage

Total All Gold and Silver Gold 43,860 Silver 854

* Indicates less than 500 Pesos.

Sources: Mineral Production in the Philippines, Bureau of Mines, Department of Agriculture and Natural Resources, Republic of the Philippines; Earl M. Irving, ICA, and other sources noted in text, as well as field interviews by transportation survey. Section VII

MANUFACTURING Section VII

MANUFACTURING

National Income in the Philippines for many years has depended in large part on the export of primary and semi-processed products--sugar, copra, abaca, tobacco, logs, and minerals. In addition to production of agricultural products for export, agricultural commodities must be produced to meet food requirements of the Filipino people. Concentra­ tion on such exports has necessitated importing finished commodities to meet the consumption and capital needs of the nation.

The development of manufacturing has been based on processing primary products for both export and domestic markets, and processing imported commodities and materials for domestic use. In addition there is small-scale manufacture of consumer goods from domestic raw materials, limited production of heavy commodities such as cement and fertilizer. Handicrafts are also produced for export and the domestic market.

Most manufacturing activity in the Philippines is directly related to primary commodities. The principal movements of raw materials to manufacturing plants, the distribution of manufactured commodities to plants for further processing and to final consumers, and the trans­ portation needs and requirements which are indicated by the study of the distribution of consumer manufactured products are reviewed in this section.

The manufacturing sector of the economy has been divided into the following categories:

1. The processing of primary products for export and the domestic market.

2. The manufacture of heavy commodities for the domestic market including cement, fertilizer, iron and steel products, and petroleum products.

3. The manufacture of consumer goods by processing domestic and imported raw material and commodities.

4. The making of handicrafts.29 PA BAU 295 6 Ag Processing Primary Products

In the export sector of the economy, the principal movements in 1955 were sugar cane to centrals and centrifugal sugar to ports of export; copra to coconut oi'l mills; coconuts to desiccated coconut plants; and the shipment of these products as well as by-products such as molasses and copra meal and cakes to ports for export. Newer developments in production for export include plans for a copper smelter by Atlas at Toledo, Cebu, with fertilizer by-products. In addition, production of plywood, wallboard, and veneer for export is planned from mills lucated at deep water ports, principally in Mind'anao, such as Nasipit and Bislig.

In the domestic sector, the principal movements were rice and corn for processing in milling operations; lumber for local production; coconut oil for domestic manufacture of soap, margarine, and related products; refined sugar for domestic sugar requirements; domestically grown Virginia tobacco for manufacture of cigarettes; and cigar leaf for cigars and cigarettes.l/ Increased production of coconut oil, refined sugar, and cigarettes utilizing Virginia leaf tobacco will depend primarily on domestic demand. In the production of lumber, sawmills are scattered through producing areas; however, Manila is the leading lumber-producing center with about 10 percent of the total lumber production based on logs brought in from nearby and distant inland points. Plywood, veneer, and a variety of end products are also produced in relatively small volume. There are plans for construction of a wallboard mill and tentative plans for manufacture of pulp, and possibly paper, in Mindanao. The only mill currently producing paper from domestic raw materials--sugar cane bagasse--is at Bais, Negros Occidental.

1/ In the estimates of National Income by Industrial Origin as showi in the Annual Reports of the Central Bank of the Philippines (See Central Bank of the Philippines, Seventh Annual Report, 1955, Table 123, p. 362), the value added by processing of sugar, palay, corn, and logs is included under the value of agriculture. How­ ever, these processes are classified as manufacturing in the Indexes to the International Standard Industrial Classification of All Economic Activities, Statistical Papers, Series M No. 4 adden­ dem 1, United Nations, New York, pp. 42-43, 56.

296 Manufacture of Heavy Commodities

As indicated elsewhere, cement and fertilizer shipments generate a significant demand for domestic transport and planned additions to production capacity will increase the demand for domestic transport in the near future.

Plans exist for basic iron and steel smelting utilizing local ore, coal, and power. Present steel production is all electric furnace smelting of local scrap concentrate at Iligan, Mindanao and at Manila with expansion planned at Iligan; production is reinforcing bars, A small volume of various iron and steel products is also produced, prin­ cipally from imported .steel. These products, manufactured mostly in Manila, include nails, agricultural implements, cabinets, and the like. Prior to World War II, only some local small-scale handicraft foundry smelting of local ores producing plow shares, tools, and the like, was carried on at Angat, Bulacan.

Petroleum refining has become an important addition to the manu­ facturing sector of the economy. The distribution of petroleum products is analyzed in the following section on Trade Centers and Tributary Areas.

With a variety of agricultural, mineral, and forest raw materials, and hydro power, the Philippines plans to increase processing in order to export a higher value product and to supply domestic needs. This development will create additional demands in domestic transport, pri­ marily the movement of raw materials and fuels used in the processes-­ scrap, ores, coal, and fuel oil. The largest center of cheap power is Iligan on the north coast of Mindanao, just below Maria Cristina Falls. The power, although cheap and abundant by Philippine standards, cannot compete with the world's cheapest power as in the Pacific Northwest of the United States, or Kitimat, B.C.. Therefore, it is unlikely that Iligan could develop as an export manufacturing center for aluminum or the high electric energy using manufactures. It may well become, how­ ever, an important focus for domestic heavy manufacturing and transport flow.

Consumer Goods

This category of manufacturing activity covers a wide range of products. A large percentage of the total value of these products is nondurable consumer products; included are food products, such as

297 bakery goods, dairy products, and beverages; tobacco products; textiles; footwear, and other wearing apparel; paper products; pamphlets, magazines and newspapers; leather and rubber products; pharmaceutical preparations, soap products and the like. In 1955 the total value of nondurable manu­ facturing production was 86 percent of the total value of all manufac­ turing production and consumer manufactures included in this category comprised most of the nondurable manufactured products.k/

In addition many products classified under durable manufacturing production are also consumer manufactures. Furniture and fixtures, glass products, lighting fixtures, much of the electrical machinery, and automobiles, as well as the miscellaneous products, are included in this category.

Most consumer goods manufacturing and new branch plants in the Philippines are concentrated in Manila. The concentration is likely to increase, since Manila is the center of the domestic market, which is only big enough to support limited development. New plants have been built to process or manufacture many items, ranging from drugs to automobile tires and an increasing amount of further processing has been or is being established including a match factory, knitting mills, shirt factories, furniture making and textiles. Much of the manufac­ turing is processing imported materials and products and in many cases consists of assembling and repackaging operations.

Transportation demand generated by consumer products is difficult to assess quantitatively. The distribution of these products is inti­ mately related to the distribution of imports and has been included as part of the analysis of trade centers and tributary areas in the follow­ ing section. These manufactured consumer products, because of their light weight, generally are not the primary generators of traffic on a route, but rather represent lighter weight back hauls; this is true

1/ Central Bank of the Philippines, Seventh Annual Report 1955, Table 94, pp. 322-326. The total value of manufacturing production excludes the processing of sugar, palay, corn, and logs. If the value of these products, such as centrifugal sugar, rice, lumber, etc., were included as part of the value of nondurable manufacturing production, the total of nondurable manufacturing would be greater. Moreover, the value of manufactured products as distinguished from process primary products would comprise a smaller proportion of the total value of nondurable manufacturing production.

298 even for domestic movements where the inflow of food stuffs by truck to Manila exceeds the outflow of manufactured products with the result that trucks go back light or carry return loads at reduced "ballast" rates in many cases. Some routes occasionally have reverse character­ istics, but they are generally minor in volume and are not the rule.

The biggest transport requirement of this manufacturing, since it is mainly localized in Manila, is simply feeding and serving an expand­ ing Manila, and distributing the lighter weight, finished products to the provinces. Perhaps the most pressing transport problem that will be created by this development is transportation within the city of Manila and its suburbs, Unfortunately, there ts no room adjacent to the present port for expansion of manufacturing. Thus the raw mate­ rials, mostly either inr.)rted or brought by interisland ships, must be transported across the city to the factories. Most of the large new factories are located in the outskirts of Manila, many of them adjacent to, or served indirectly by Highway 54., a new circumferential highway around the city. Thus overcrowding is being avoided, However, High­ way 54 in places will become so lined with heavy traffic generators that it will cease to function as an efficient artery inasmuch as it is not a road with limited access. The problem is further aggravated because few of the factories have rail sidings. It is fortunate, at least, that most of them have light transport requirements.

Reclamation of large tracts of swamp land along the bay north of North Harbor should be investigated as a site for heavy and other industries using port facilities. Plants located on this land would avoid heavy city traffic, thereby reducing costs. This type of devel­ opment would be expensive since much dredging of shallow water would be required for deep sea access. However, the dredged material would provide the fill. Furthermore additional port facilities are already required, especially for offshore shipping. The present South Harbor, which accommodates all overseas shipping, is congested, although much of this can be relieved through pier construction. The most logical area for future expansion is north of the present North Harbor, since expansion south is blocked by the Luneta and Dewey Boulevard as well as by the built-up section of the city back of this area. If manufac­ turing proceeds as fast as planned, industry could well afford to rent the land created on long-term leases and thus pay for much, if not all, of the cost of reclaiming the land and dredging the channels for port facilities. Asking prices for land even as far out as Highway 54 are already reported as extremely high and subject to speculation, which discourages many industries.

299 The Manila domestic transport problem is outside the scope of this study. However, expensive local transport may well create a real national problem whose solution should be planned now before it is too late. An industrial port at Manila may be urgently required if much new manufacturing is created. Acquiring such land and facility, although expensive, in the long run might well provide a means of financing port facilities already urgently needed for other purposes. To a lesser extent the same possibilities might also be investigated at Cebu City, where port expansion ultimately will be required.

Handicraft Industries

Little need be said about handicraft industries. They are gener­ ally small butmany serve a real need. Transport requirements for them are generally local in nature. However, numerous special centers do exist which produce a variety of items including wooden shoes and other wood products, textile weaving, shell products, straw hats of various kinds, rattan furniture, leather products, embroidery, and jewelry. These commodities are part of the general trade of the Philippines. Many of the handicraft industries are located in Manila and surrounding rural areas. Except for embroidery, most handicraft products are not export.,d. Many of them are so-called cottage type which might be encouraged to some extent by improved barrio roads providing access to additional markets in the cities. On the other hand, the opening of roads would enable mass produced goods from the cities to penetrate the barrios more readily, possibly to the disadvantage of cottage-type industries. Several of the handicraft industries are already losing ground, including hand textile weaving in northern Luzon.

300 Section VIII

TRADE CENTERS, TRIBUTARY AREAS, AND THE DISTRIBUTION PATTERN Section VIII

TRADE CENTERS, TRIBUTARY AREAS, AND THE DISTRIBUTION PATTERN

The movement of goods and people is handled through a hierarchy of trade centers and tributary areas. In some areas the pattern is well developed, in others moderately or hardly at all (Figure VIII-28 and VIII-29). Although the same patter- does not preva!l, for all services, a reasonable, multipurpose framework does exist. This framework both controls and responds to the traffic flows of the islands. Changes in transport affect the framework. The construction of roads has had a marked effect in establishing a convenient spacing of major trade cen­ ters providing fundamental services to the economy in a way that iso­ lated coastal landings dependent on water transport could not. The system of trade centers with its distribution patterns thus is a key item to recognize and analyze because of its vital interrelations with transport. By strengthening and rationalizing this framework, trans­ port contributes to the integration and efficiency of the economy.

The Distribution of Imports and Other Products

One of the key functions of the trade area framework is the dis­ tribution of imports throughout the country. These imports in many . cases are foreign imports brought into the country, principally through Manila. However, they are also local imports from one domestic region into another and tend to be handled through the major trade center frame­ work, in contrast to exports which may be shipped out directly from rural producing areas because of larger and more homogenous volume. The distribution pattern of imports resembles the distribution of manu­ factured products from Manila.

Unfortunately data on physical volume of foreign and domestic im­ ports are unavailable for comparison with exports. The total volume thus is not known, but it is large in the aggregate, although individu­ ally the numerous items generally are light weight and small in compari­ son with raw materials or agricultural products. The multiplicity of items does create a significant tr&nsport demand. The most important single imported commodity, and an exception to the general character­ istics of many other imports, is petroleum and its products. Its vol­ ume has been calculated and it is treated later in the report; its network of depots and distribution areas is also used an an indicator of trade centers and areas in Table VIII-I at the end of this section.

303 -Legend-

@ NATIONALCENTER

INTERREGIONALCENTER CISU.ILOILO.DAVAOZAMI.NGthIshi @ MAJORCENTERI Cutakit to~~ fat ae Cattles C LG

* SECONDARYCENTER

O MINORCENTER

AiPPROXIMATE TRADE AREA BOUNDARYZONES --- INDEFINITE TRADE AREA BOUNDARY ZONES

*flea(5stA' IkIIoaIk5te0s, IILD

.0 toA SISSII5.5%tr.40 ts sA1((55(50 (11.L .e4 IlttI"&tI e4.4(51 0 flC*Lt~sta.S

0

FIG. VIII-28 TRADE CENTERS AND TRIBUTARY AREAS

304 LEGEND 1.000 PEOPLE 0 URBAN CENTERS

9

Courtesy of Philippines Study Program, the University of Chicago.

FIG. VIII-29 POPULATION DISTRIBUTION by an importer or a company Foreign imports are generally received are distributed in a variety of in Manila. From there imported goods In many cases, direct arrange­ ways to the remainder of the country. delivered from Manila to to pick up or have the goods ments are made the all large. More generally, retail outlet if it is ati the outlying outlying trade center and the placed through an agent in some order is if volume to the retail outlet or, either shipped from Manila goods are in the major out­ to agents or wholesale establishments is sufficient, an agent in a major A Manila concern may have lying trade centers. turn, has Cebu City. The agent in center, particularly in interregional the volume of goods to orders through him. If subagents who process the more agents in motor parts or canned milk, be handled is sufficient, as the retail distribution is widespread areas. Most of will be located in of channels have an intricate organization in the hands of Chinese who and credit.

much buying-nespecially this distribution pattern, As a result of Even on done directly from Manila. on Luzon where roads penetrate--is small centers buy directly however, the pattern variestome Luzon, major trade center. Very small Manila, some from the nearest from stores in the same town and the like) buy from larger stores (sari-sari also acting town, the larger retailers thus or from an adjacent larger tnknown. A practice Chain stores are virtually as limited wholesalers. to act as a general widespread is for a retailer which is particularly The trader commodities such as rice. or buyer of locally produced trader brings back market such as Manila and hauls the rice to a large often store or those of sale either through his own general merchandise for On Luzon one com­ or contract trucks are used. others. Owner' s trucks has also recently been established. mon carrier trucking company distribution in order provide their own network of Some companies industry. most notable is the soft drink to insure penetration. The than 900 trucks which distribute company has a fleet of more One large goes. Three levels of the islands wherever a road directly throughout in Manila; nine main headquarters and plants centers are involved: the as on each of the major islands branch-bottling plants, generally ends located at the north and south Iligan and Naga centrally follows: Bacolod on Negros, Tagbilaran Cebu on Cebu, Iloilo on Panay, of Luzon, Davao on Mindanao; on Leyte, Cagayan de Oro and on Bohol, Tacloban and are generally are under these branch plants fifty-eight warehouses isolated although a few are in small located in major trade centers, spots because of need for stocks. coastal landings or other strategic in the table of Trade Centers The various centers are indicated (Table VIII-I).

306 Petroleum Distribution

From a tonnage standpoint, petroleum and its products comprise one of the largest single commodities transported, more than half the tonnage of all minerals (excluding local construction materials) or equal to all timber and lumber produced, the two most important com­ modity groups in the islands. Howeverythe great volume and nature of petroleum and products make it easy to handle in bulk for much whole­ sale distribution. This, coupled with only a small number of suppliers, enables the commodity to be transported by small tankers to several points in the islands and brought in by large tankers to a few points, taking advantage of natural water transport in a way no other commodity can. Only minimum port facilities are requir-d--merely a pipe out to piles and tanks on shore. In some ca3es even floating pipes can be used to deep water. Pumping to and from lighters and rehandling are even relatively cheap. Since individual companies generally handle their own movements, it is unnecessary for the government in most cases to build special facilities, since only one beneficiary would be served.

There are nevertheless petroleum transport problems of national concern. Several ports or potential ports have poor protection for even anchoring tankers. This hampers or may preclude cheap tanker transport to some areas when volume increases, as on the north coast of Luzon. Most small retail and even many wholesale points are not sup­ plied in bulk, presumably because of relatively small volume. Gasoline and other products are transported in drums or tins by boat or truck with attendant high handling costs. Poor roads in many areas, as well as low volume, also make companies reluctant to operate tank trucks. As volume increases and facilities are improved much of this uneconomi­ cal handling can be eliminated.

A large percentage of petroleum products is therefore transported as general cargo and thus becomes an important part of the general movement of non-bulk commodities throughout the islands.

According to one source, approximately 1,849,000 metric tons of petroleum and productsl/were imported into the Philippines in 1955, valued at 92,944,000 pesos. Domestic production is nil, although one refinery has been established (at Batangas) and two others are planned soon. They will import crude petroleum.

1/ Converted to metric tons from various sized containers and calcu­ lated from Foreign Trade Statistics, 1955, Bureau of Census and Statistics, Manila.

307 Following is the breakdown by major components of the imports:

PETROLEUM AND PRODUCTS IMPORTS, PHILIPPINES, 19551/

Weight Value 1000's of 1000's of Metric Tons Pesos

Diesel Oil 620 ) 25,095 Gasoline 358 24,000 Bunker Fuel Oil 335 9,286 Crude Oil 290 9,028 Kerosene 143 8,357 Others 103 17,178

Total 1,849 ? 92,944

Although no detailed statistics are available, most of the imports by weight come in bulk by tanker. Much of the "other" category, howevez in the preceding table comes in containers of literally dozens of dif­ ferent kinds ranging from drums to flasks.

Manila is the leading import center, accounting for about one-half the volume, but foreign tankers also come directly into Cebu City, and San Fernando, La Union, for most companies; these ports are thus the other major points of distribution. In addition some companies also bring foreign tankers directly into Davao and Iloilo, the other two major distribution centers. Following is the breakdown of major com­ ponents in Manila's petroleum products imports:

1/ Figures vary somewhat according to source, because they are based on withdrawal of stocks and release of records at different times from Customs, Foreign Trade Statistics, 1955, Bureau of Census and Statistics, Manila.

308 IMPORTS OF PETROLEUM AND PRODUCTS PORT OF MANILA, 1955 (Thousands of Metric Tons)-

Oil NOS (Crude) 233 Oil Fuel (Bunker) 228 Gasoline NOS (Motor) 156 Diesel Oil NOS (non-automobile) 69 Kerosene 60 Spirits 60 Others 129

Total 935

Manila redistributes petroleum and products throughout southern Luzon, Central Luzon as far north as Pangasinan, and throughout the Cagayan Valley, Mindoro, Palawan and contiguous islands. Tank trucks are used in the adjacent populous areas of central and southern Luzon; rail and some interisland tankers to the Bicol in southern Luzon; general cargo nontanker trucks to the Cagayan Valley, and general cargo nontanker, interisland ships to Palawan, Mindoro, and adjacent islands with some local tankers to Calapan, Mindoro.

Cebu City distributes to a wide territory throughout the Visayas, from Masbete to Mindanao and Sulu, mostly by general cargo, nontanker interisland ships and boats, with some local bulk tanker shipments (as well as nonbulk) to a few points including Tacloban on Leyte, Butuan and Bugo (Cagayan de Oro) on Mindanao and, for some, Davao, and Jolo.

Iloilo distributes by tank truck and package truck throughout most of Panay, and to Bacolod on Negros by local tanker. Davao distributes by package truck or package freight boats in southern Mindanao.

There is some overlap in territories and in patterns of distribu­ tion between companies. One company, Caltex, operates its own refinery at Batangas and distributes throughout the islands from there using

1/ Special compilation for transportation survey by Robot Statistics, Manila, based on converting data on incoming customs manifests. Batangas is part of Manila Customs district and thus the manifests apparently report crude oil destined for Batangas.

309 similar, but not identical depots and modes of transport to those listed above. When other companies build refineries, distribution will be from those points, rather than direct importation to the largest centers. Most of the refinery construction will occur in the Manila area, with possibility of one at Cebu City.

In addition to the major distribution centers or bulk installations noted above, there are many regional depots from which further distribu­ tion is made. These centers are indicated in the table of trade centers and trade areas (see Table VIII-I).

The general pattern of petroleum distribution fits closely into the trade center and trade area classification as used for other purposes; petroleum distribution thus is an objective indicator of trade center importance. The major exception is the role of San Fernando, La Union, as a major bulk installation importing directly by foreign tankers. Only in this one function does San Fernando resemble the major inter­ regional centers of Cebu, Iloilo, and Davao.

According to one company's estimates, the regional demand for gaso­ line and diesel oil for use in automobiles, the largest consumer of petroleum products, is: about 70 percent of the total for the Manila District (including all of Luzon, and the negligible amounts in Palawan, Mindoro, and adjacent islands), about 15 percent for the large Cebu District (Cebu, Bohol, Samar, Leyte, Sulu, Negros Oriental, and Minda­ nao, except Davao Province), about 7 percent for the Iloilo District (Panay and Negros Occidental), and about 3 percent for the Davao District (Davao Province). This pattern is undoubtedly similar to the total petro­ leum products consumption pattern, except for a slight increase in the proportions outside Luzon, especially for the Cebu District, based on ship and boat use of bunker fuel, diesel oil, and gasoline.

A surprising amount of petroleum products still moves by package carrier, even from major bulk installations to principal redistribution depots. Tanker moves will replace this as volume increases; this has recently occurred in Bacolod. Package trucks, as well as package ships and boats are also employed. From Manila to the Cagayan Valley, for example, package trucks are used, although tanker truck movements are being increased. One reason package trucks are used is because ordi­ nary trucks bringing heavier foodstuffs and raw materials to Manila re­ quire general cargo for return hauls and thus quote low rates. The same phenomenon occurs in much of the ship traffic which collects copra, other raw materials, and foodstuffs, and needs return cargoes from the larger centers, notably Cebu.

310 Trade Centers and Tributary Areas

The trade center and tributary classify about area map and the accompanying 200 trade centers in the Philippines table into five size cate­ gories. (Figure VIII-28 and Table VIII-I.) The purpose is to recog­ nize only trade centers of some importance or effect in generating traffic. Excluded from the fivefold several thousand classification therefore poblacions and barrios, are mostly rural farm settlements, but with some rudimentary central services.

Since the purpose of the classification was to delimit trade and centers traffice generation, areas size of the centers was terion in the classification. not a main cri­ Generally the higher larger echelon centers are than the lower, but saie densely settled areas with cities may have their fairly large cities ranked lower on centers the scale than smaller in less populous areas a which provide real central surrounding region. In addition services for no realistic figures on population are available. The census lists only poblaci&-i figures, which are not uniformly comparable and are generally too low since they exclude suburbs or municipio figures which are worse because they include nonurban areas. For some of the larger places a more realistic estimate is provided in the tables. Still other localities are chartered cities whose territory includes much nonurban land.

The procedure ior drawing up trade viewing in areas was established by the field throughout the islands. inter­ Merchants, presidents of local Chinese Chambers of Commerce, and others, in a major center were asked to delimit the trade area of their center for their specialty and to indicate its importance. Owners or managers of small storeci in rural barrios at the edges of the trade areas were then interviewed the same questions and asked as a check. These combined were then results of the field work compared with Bureau of Public Highways traffic flow maps based on field traffc counts for each of the 52 provinces for the years 1953 and 1954. The correlation was generally remarkably close: the boundary of a trade area coincided with the centers. traffic divide between

In some cases precise delimitation fic counts was difficult because were not sufficiently closely the traf­ spaced on the road. In some areas without extensive road networks, water traffic furnished clues. between ports Launch routes and stream patterns for native canoes were used as a guide. In still other cases, bus routes provided additional information. and other data

311 The main base for the trade areas was provided by the. traffic flow maps. Because of the close calibration with actual field checks, the traffic flow maps were also used for numerous places not visited. The trade areas thus were drawn on judgment based on objective data and represent traffic areas as well as trade and general tributary areas.

Objective criteria were also employed in classifying and identify­ ing the trade centers. Practically all of the centers have Chinese Chambers of Commerce which were found to be excellent criteria in most areas for recognizing small centers. Larger centers could be recognized by soft drink warehouses and branch plants, gasoline depots and bulk installations, presence of provincial capitals, and other indicators.

The following classifications are shown on the map and table. (Figure VIII-28 and Table VIII-I.)

National Center: (1) Manila

Interregional Center: (4) Cebu, Iloilo, Davao, Zamboanga (partial)

Major Center: (33) Generally larger cities and centers of large trade areas; all, except two are provincial capitals: All are regional centers of numer­ ous economic and social activities

Secondary Center. (34) Similar to major centers but relatively less important

Minor Center: Small retail and distribution centers; practically all with Chinese Chamber of Commerce

Two types of boundary zones of trade areas are recognized, one more definite than the other. The less definite boundaries are bounda­ ries of minor centers or boundaries in some undeveloped areas, or other boundaries not ascertained precisely.

Where no boundary is shown, trade areas either do not exist (in unsettled areas) or are minor (fragmented areas back of isolated coastal landings). In settled areas, no boundaries are shown around some minor centers. 312 The National Center--Manila

Manila, although not at the geographic center, serves all of the Philippines for many specialized central services as well as being the interregional center for all the northern half of the Philippines and a major center for a large immediate hinterland. Manila surpasses all other cities as the leading center for imports, manufacturing, govern­ ment, education, communications, and a vast range of specialized social administrative services. Its newspapers, to take but one example, pene­ trate all over the islands; the press in other centers is minor. Manila's populato..n of about 2,000,000, ten times larger than the next largest center, Cebu City, is a measure of its primacy. It has the strongest land connections to the largest land mass in the Philippines. Two railroads and several paved highways lead out from it. In domestic water transport it is almost equal to Cebu. The dominance of Manila and the Manila market has been discussed at length in other sections. Only two of those findings will be repeated: half the petroleum im­ ports come through its port and half the domestic consumption of lumber is shipped to its market.

Interregional Centers

There are five interregional centers (including Manila) serving as major sub-centers in the Philippines. (See inset on Figure VIII-28.) These centers resemble small wholesale centers in the United States.

Cebu City,the second largest city, serves as the center for most of the southern half of the Philippines. Its hinterland, unlike Manila's, is reached almost entirely by water which is the only means of connect­ ing the numerous islands which comprise its hinterland. For this reason it has a slightly greater domestic trade by water than Manila. However, its land trade on restricted Cebu Island is limited. Cebu City func­ tions also an an entreport, particularly for copra for which it is the leading trade center.

The edges of the Cebu trading area on the north meet the Manila area. Samar in many ways thus is more closely tied to Manila than to Cebu. More passengers go by ship from Samar to Manila, but Cebu col­ lects more copra from Samar. Cebu City is also probably equally, if not more important, as a general supply source. Petroleum and many other products are sent from Cebu City to Samar. Masbate farther north, is also shared with Manila.

313 Iloilo, traditionally the third center, divides the central Philip­ pine areawith Cebu. The north to south alignment of the islands of Cebu and Negros and their water margins create a barrier to the east to west movement by water or land and result in two centers serving what might otherwise be accomplished by one. Iloilo faces further competition from the rise of Bacolod City on Negros across Guimaras Strait. Formerly most of the sugar trade of rich Negros was transfer­ red through Iloilo because it had the only deep, protected harbor; now most of it is lightered directly to offshore ships on the Negros coast, in spite of shallow water and lack of suitable ports. Bacolod City has also risen as the direct center of the sugar area, partly as a result of excellent highways replacing older water transport. Numerous central services have thus developed.

It is probable that Manila is more the interregional center than Iloilo for the north coast of Panay, at least for Kalibo and the new province of Aklan on the northwest. Poor roads cross the island, al­ though a railway runs to Roxas.

Davao in southeastern Mindanao has an isolated trade territory but does serve as an interregional center with road and water connections to its surrounding areas.

Zamboanga serves p rtially as an interregional center. Its hinter­ land is almost entirely reached by water, since roads have not yet been finished along the Zamboanga peninsula save for short distances. The south-central coast of Mindanao including Cotabato is also probably loosely in Zamboanga's territory. It also has strong ties with Manila and Cebu City. Passenger flow from Cotabato to Zamboanga,however,is apparently slightly greater than to Manila or Cebu.

Major, Secondary, and Minor Centers

The 33-major and 34-secondary centers are scattered over the islands providing a range of economic, political, and social services. These centers are important and furnish the basic regional urban serv­ ices to the country. They are, however, small, ranging in population from about 10,000 to 50,000, and should not be confused with wholesale centers in the United States. Rather they resemble large county seats and retail centers. Discussion of individual cases is impractical be­ cause of the number of centers.

Some generalizations on major and secondary trade areas and cen­ ters can be made on the basis of map inspection (Figure VIII-28). The

131 A areas are generally of the same magnitude of size and the centers are generally near the centers of their respective territories; spacing in developed and reasonably homogenous territory is quite regular, as would be expected. However, the Philippines are so divided by water, mountains, and variation in population density that regular spacing is inhibited over much of the area. (Figures VIII-28 and VIII-29.) Most of the major and secondary centers are on the coasts and most of them are ports. Their trade areas are thus generally synonymous with their port hinterlands. However, many of the apparent coastal cities in reality are not directly on the coast but rather are a short distance back and have an outport as Daet-Mercedes, Roxas-Culasi, Kalibo- New Washington and many others. The areas that are particularly irregular and unorganized are the unsettled or lightly settled, rough, mountain­ ous regions along the northern and central east coast of Luzon, eastern Mindanao, south central Mindanao, southern Negros Oriental, Palawan, and most of Mindoro. Some of these areas will develop, but difficult terrain and access area problem in most of them. The Baguio trade area is especially eccentric, with Baguio in the southern corner and its tributary area composed of mountainous territory which normally would be a dividing zone. Baguio, however, is connected with the territory by a remarkable, long, ridge road which serves as the spineof its trade area.

The recognized minor centers number 126. Undoubtedly some others could be added, but the category gradually fades out to smaller and smaller centers.

Under the minor centers are more than 17,000 barrios, essentially rural farm settlements inhabited by farmers who commute to their fields.1/ Most of the rural population of the Philippines live in agglomerated settlements with relatively few in isolated farm houses. The barrio settlements have some rudimentary cenLral services, with schools the most widespread function. Market day is held generally once a week for a half day and a few sari-sari (small stores or stands) operate at all times. The more important barrios are the poblacions or central bar­ rios in each small cluster of barrio settlements. Generally only in the poblacio'ns are found the higher grades of school.&2

1/ Generoso F. Rivera and Robert T. McMillan, The Rural Philippines, Mutual Security Agency (ICA), Manila, 1952, p. 5. 2/ Ibid, p. 147. Conclusion: The Role of Transport and the Development of Trade Centers

The Philippines have an organized framework of distribution cen­ ters. This system, however, is still in its infancy and in a state of flux. Distribution of imports, therefore, is handled in a variety of ways. Construction of roads, however, is altering the trade area net­ work. On Samar, for example, the construction of a transisland road brought the trade of the east coast to Catbalogan and consolidated it all in one port. Ship service was abandoned along the east coast when the highway was completed. This trend is occurring all over and is resulting in reducing the number of trade centers and ports.

Improvement of transport and especially of roads not only lowers the cost: of transporting goods and peoples, but also enables a more rational framework of distribution centers to be established. In some instances road construction results in the national or interregional center being able to over-ride the former major centers causing some dislocation. On balance, however, road improvement enables a strong system of centers to develop providing special services efficiently to the country. This promotes integration and economic development. Table VIII-I

TRADE CENTERS AND TRIBUTARY AREAS, PHILIPPINES

Gasoline Soft Drinks HQ-Headquarters Chinese Provin- W-Warehouse B-Main Installation 2 Type of Trade Areas and Chamber cial Poblacionr BP-Branch D-Depot Center Trade Centers Commercel/Capital-1/(population) Plant Co. 1 Co. 2 Co. 3 Remarks

NatiLoal Manila * 2,000,000 HQ HQ HQ HQ (estimate for whole metro. area) I.Manila Trade Area (Luzon, C', Mindoro, Pala­ -4 wan and adja­ cent islands) Inter- regional Manila

Northern Luzon

Cagayan

Major Aparri * 10,125 W Tuguegarao * * 12,378 W Minor Tuao * * 1,215

n.a. means not available.

.1/ hinese Chamber of uommerce and Provincial Capital where indicated after name of Trade Center. 2/ These census figures, the only ones available, are not correct since poblacion areas do not coincide with actual urbanized areas. They tend to be under rather than over the correct figures and are inconsistent. In other cases chartered city populations where available are used butthese are generally far too big since much rural area is included. (City populations are indicated by the word city after the center name. Manila and Cebu are reliable estimates and not poblaci6n figures.) 3/ Co. 1, Co. 2, Co. 3 under Gasoline indicate three separate companies. Table VIII-I (Continued)

TRADE CENTERS AND TRIBUTARY AREAS, PHILIPPINES

Gasoline Soft Drinks HQ-Headquarters Chinese Provin- W-Warehouse B-Main Installation 2 Type of Trade Areas and Chamber cial Poblacion ' BP-Branch D-Depot 3/ Center Trade Centers Commerce.1 /Capitall/(population) Plant Co. 1 Co. 2 Co. 3- Remarks

Isabela

Major Iligan * * 7,436 BP Santiago * 5,807 Secon­ Cauayan * 2,827 W dary Echague * 2,568 cc Minor Cabagan * 1,665 Tumauini * 1,656 Gamu * 2,476 Cabatuan * n.a. San Mateo * 1,365 Alicia-Angadanan * 2,510(a) Jones * 1,838 Nueva Vizcaya

Major Solano-Bayom­ Solano Bayom­ S-9,497 Twin cities bong bong B-6,929 w 7 kms apart Minor Bagabag 2,477 Solano more Aritao 2,451 important Dupax 2,365 commercially; Santa Fe n.a. Bayombong, Ilocos Norte provincial capital Major Laoag * * 22,218 w

n.a. means not available in Census of 1948. (a) For Angadanan only; no figures available for Alicia. Table V-III-I (Continued)

TRADE CENTERS AND TRIBUTARY AREAS, PHILIPPINES

Gasoline Soft Drinks HQ-Headquarters Chinese Provin­ W-Warehouse B-Main Installation Type of 2/ Trade Areas and Chamber cial Poblacion­ BP-Branch D-Depot Center Trade Centers Commercel/Capital-1 (population) Plant Co. 1 Co. 2 Co. 3- Remarks

Ilocos Sur

Major Vigan * * 7,424 w Secondary Candon * 3,305 w Minor Narvacan 2,615 W, Abra

Secondary Bangued * * 5,663 La Union Major San Fernando * * 4,636 B D B Mountain Province Major Baguio (City) * * 29,262 W Central Luzon Major Pangasinan Dagupan * 11,254 W Dj

Minor Alaminos * 3,014 Lingayen * * 6,350 Villasis- 4 ,677(a) Three small Carmen- n.a. centers close Urdaneta 4,474(b) W (Urdaneta) together in densely popu­ (a) Poblacion figure for Villasis. lated area. (b) Poblacion figure for Urdaneta. n.a. means no figure available for Carmen. Table VIII-I (Continued)

TRADE CENTERS AND TRIBUTARY AREAS, PHILIPPINES

Gasoline Soft Drinks HQ-Headquarters Chinese Provin- W-Warehouse B-Main Installation Type of Trade Areas and Chamber cial Poblaci'n2/ BP-Branch D-Depot Center Trade Centers Commercel/CapitaLi/(population) Plant Co. 1 Co. 2 Co. 3'/ Remarks

Minor Rosales * 4,411 Tayug * 5,108 Zambales

Secondary Olongapo * 35,000 Naval base Iba * * 3,064 Minor Sta. Cruz 2,189 ca Masinloc 1,988 D Mine center San Narciso 9,908 W Bataan Secondary Balanga * 5,061 w Tarlac

Major Tarlac * * 20,818 w Minor Camiling 7,765 Victoria 5,672 Concepcion * 3,104 Nueva Ecija

Major San Jose * 10,544 Cabanatuan 15,691 w Pampanga *

Major San Fernando * 6,636 w Secondary Angeles * 7,118 Air base Minor Guagua * 5,914 Table VIII-I (Continued)

TRADE CENTERS AND TRIBUTARY AREAS, PHILIPPINES

Gasoline Soft Drinks HQ-Headquarters Chinese Provin- W-Warehouse B-Main Installation Type of Trade Areas and Chamber cial Poblacion2/ BP-Branch Center D-Depot Trade Centers Commerce1 /Capital1(population) Plant Co. 1 Co. 2 Co. 3/ Remarks Bulacan Secondary Malolos * * 2,894 Rizal

Minor Binangonan 4,463 Tanay 7,518 Laguna Co Secondary San Pablo (City) * 21,686 w D Minor Siniloan 4,077 Sta. Cruz * * 1,093 Calamba 7,600 w Los Banos 2,240 College town Batangas

Secondary Batangas * * 10,326 B Lipa (City) w 8,663 (refinery) Minor Rosario 3,150 San Juan * 2,121 Tanauan- 4,265 Sto Tomas 1,233 Quezon Major Lucena * * 18,085 W. Secondary Gumaca * 6,461 w Table VIII-I (Continued)

TRADE CENTERS AND TRIBUTARY AREAS, PHILIPPINES

Gasoline Soft Drinks HQ-Headquarters Chinese Provin- W-Warehouse B-Main Installation Type of Trade Areas and Chamber cial Poblacion2/ BP-Branch D-Depot Center Trade Centers Commerce1 "Capital-/(population) Plant Co. 1 Co. 2 Co. 3 Remarks Quezon (Cont.)

Minor Baler * 2,769 Infanta 2,412 Mauban * 4,051 Tayabas 5,795 Candelaria * 5,616 Atimonan * 4,027 Sian n.a. Unisan * 1,890 Pitogo * 2,452 Macalelon * 2,018 Gen. Luna * 1,565 Catanauan 3,273 San Narciso 1,341 Guinayangan 1,883 Tagkawayan 3,841 Calauag 4,260 Lopez 3,644 Southern Luzon

Camarines Norte

Secondary Daet * * 11,355 W

Minor Paracale * 3,204 Near Larap, Jose Panganiban 2,600 mine center Table VIII-I (Continued)

TRADE CENTERS AND TRIBUTARY AREAS, PHILIPPINES

Gasoline Soft Drinks HQ-Headquarters Chinese Provin- W-Warehouse B-Main Installation Type of Trade Areas and Chamber cial Poblaci n.2/ BP-Branch D-Depot Center Trade Centers Commercel/Capitall/(population) Plant Co. 1 Co. 2 Co. 3- Remarks Camarines Sur Major Naga (City) * * 8,136 BP D Secondary Libmanan * 6,075 Nabua- * 4,595 Iriga and Iriga * 7,329 Nabua almost Minor Tigaon 2,669 twin cities Ca Sipocot 1,533 D W3 W Albay Major Legaspi * 18,987 W D D D * Secondary Tabaco 8,308 Minor Ligao 9,725 * Sorsogon * Secondary Sorsogon * * 9,971 W Minor Magallanes 5,298 Casiguran * 3,638 Gubat * 9,045 Bulan Irosin 7,394 Catanduanes Secondary Virac a . * 8,539 Table VIII-I (Continued)

TRADE CENTERS AND TRIBUTARY AREAS, PHILIPPINES

Gasoline Soft Drinks HQ-Headquarters Chinese Provin- W-Warehouse B-Main Installation Type of Trade Areas and Chamber cial Poblacion2/ BP-Branch D-Depot Center Trade Centers Commercel/Capitall/(population) Plant Co. 1 Co. 2 Co. 33/ Remarks

Palawan, Mindoro and Other Islands Palawan

Secondary Puerto Princesa 3,000 w D (diesel) Mindoro

W, Secondary Calapan * * 6,113 w D. D Minor Pinamalayan * 3,241 Mamburao * 1,117 San Jose 2,259 D Marinduque

Secondary Boac * 3,262 D(9) Minor Sta. Cruz * 3,851 Romblon

Minor Odiongan * 1,936 w II. Cebu City Trade Area Eastern Visayas and Northern Mindanao Inter­ Cebu City regional Table VIII-I (Continued) TRADE CENTERS AND TRIBUTARY AREAS, PHILIPPINES

Gasoline Soft Drinks Chinese Provin- HQ-Headquarters Type of Trade W-Warehouse B-Main Areas and Chamber cial Installation Center Poblaci 2/ Trade Centers Commercel/Capitali/(Population) D-Depot BP-Branch Plant Co. 1 Co. Cebu 2 Co. 31/ Remarks Major Cebu City * 200,000 * BP(w) B D B Minor Bogo (metro. area) Balamban 6,371 w 3,707 Argao 3,706 w XeXros oriental COW" on Major Dumaguete * 9,366 Secondary Bais * D 2,943 Minor D Himalalud Sugar central Guihulngan * 1,720 7,026 Negros OccidentalA/ Minor San Carlos * 15,242 w Bohol Sugar central Major Tagbilaran Minor * 5,879 BP Tubigon * Jetafe 1,371 w D 2,420 Ubay Carmen 3,029 Jagna 1,046 w 686 w

a/ For remainder of province see Iloilo Trade Area. Table VIII-I (Continued) PHILIPPINES TRADE CENTERS AND TRIBUTARY AREAS,

Gasoline Soft Drinks HQ-Headquarters W-Warehouse B-Main Installation Chinese Provin­ D-Depot cial Poblacion BP-Branch Type of Trade Areas and Chamber Co. 1 Co. 2 Co. 3:1i Remarks (population) Plant Center Trade Centers Commerce Capital

Samar * * 10,757 w Major Catbalogan * 7,853 Calbayog (City) * 11,293 Secondary Catarman * 4,884 Laoang * 3,319 Minor Allen * 2,965 Borongan * w 7,222 a) Guiuan Masbate w D * 5,817 Secondary Masbate * Leyte BP D ID (City) * 31,155 Major Tacloban iv * 7,660 Secondary Ormoc (City) * 5,172 Minor Palompon * 9,414 Baybay * 3,551 Hilongos * 5,569 Maasin iv 1,520 Malitbog * 1,474 Liloan * iv Cabalian 3,363 Surigao * 12,870 D Major Surigao Table VIII-I (Continued)

TRADE CENTERS AND TRIBUTARY AREAS, PHILIPPINES

Gasoline Soft Drinks HQ-Headquarters Chinese Provin- W-Warehouse B-Main Installation Type of Trade Areas and Chamber cial Poblacion2' BP-Branch D-Depot Center Trade Centers CommercelCapitall/(population) Plant Co. 1 Co. 2 Co. 32 Remarks

Surigao (Cont.) Minor Placer * 3,947 Dapa * 4,733 Cantilan * 4,141 Tandag * 6,735 Marihatag * n.a. Lianga 3,173 ca Agusan Major Butuan * * 9,162 W, D D Lumber Minor Cabadbaran * 3,452 Nasipit 3,165 Lumber Misamis Oriental Major Cagayan de Oro * * 15,159 BP D D(Bugo) Minor Initao * 5,480 Quinoguitan 3,776 Gingoog * 9,331 D Lumber Bukidnon Secondary Malaybalay 2,267 Lanao

Major Iligan * 4,341 W 1) Electric power manufacturing Dansalan 4,882 Moro capital Table VIII-I (Continued)

TRADE CENTERS AND TRIBUTARY AREAS, PHILIPPINES

Gasoline Soft Drinks HQ-Headquarters Chinese Provin- W-Warehouse B-Main Installation Type of Trade Areas and Chamber cial Poblacion2/ BP-Branch D-Depot Center Trade Centers Commercel/Capitall/(population) Plant Co. 1 Co. 2 Co. 3! Remarks

Lanao (Cont.) Secondary Tubod * 13,226 w Minor Kolambugan 4,562 Kapataganga/ *

Misamis Occidental

Major Ozamis (City) * 9,688 w W~ Secondary Oroquieta * * 7,233 w Minor Plaridel 3,010 Baliangao * 532 Jimenez 3,237 D D Zamboanga del Norte

Major Dipolog .* * 8,770 w Secondary Sindangan * 5,832 Minor Katipunan 4,330 III. Iloilo Trade Area (Panay and Negros Occidental) Inter­ Iloilo regional

Major Iloilo (City) * * 46,416 BPI B D D

a/ For remainder of province see unassigned territory at end of table. Table VIII-I (Continued)

TRADE CENTERS AND TRIBUTARY AREAS, PHILIPPINES

Gasoline Soft Drinks HQ-Headquarters Chinese Provin- W-Warehouse B-Main Installation Type of Trade Areas and Chamber cial Poblacion2 BP-Branch D-Depot Center Trade Centers Commercel/Capital-/(population) Plant Co. 1 Co. 2 Co. 3 / Remarks Iloilo (Cont.)

Minor Estancia * 2,797 Sara 2,839 w Capiz

Major Roxas City * * 11,673 w D Aklan

W Major Kalibo * * 3,834 W Antique Secondary S. Jose de Buenavista * * 5,159 1 Negros Occidental

Major Bacolod (City) * * 42,820 BP B D D Minor Binalbagan 6,979 Sugar Central Pulupandan 6,070 Port for Bacolod Silay * 9,066 Victorias 5,890 Sugar Central Cadiz 9,195 V Fabrica * n.a. Lumber (For San Carlos see Cebu Trade Area) Table VIII-I (Continued)

TRADE CENTERS AND TRIBUTARY AREAS, PHILIPPINES

Gasoline Soft Drinks HQ-Headquarters Chinese Provin­ W-Warehouse B-Main Installation Type of Trade Areas and Chamber cial Poblacibn2a/ BP-Branch D-Depot Center Trade Centers Commercel/Capitall/(population) Plant Co. 1 Co. 2 Co. Remarks

IV. Davao Trade Area (Southern Mindanao) Inter- Davao City regional

Major Davao (City) S*.47 A8A BP B D D Secondary Digos 21,000 W Ca Minor Magugpo * 6,000 Lupon * 1,425 Mati 2,899 Cotabato

Secondary Dadiangas * 4,000 W D Minor KidapawanE * 7,820 V. Zamboanga Sub Area (Southwestern Mindanao and Sulu) Partial Zamboanga City Inter­ regional

Major Zamboanga City * 17,001 W D D D (proposed) a/ For remainder of province see unassigned territory at end of table. Table VIII-I (Continued)

TRADE CENTERS AND TRIBUTARY AREAS, PHILIPPINES

Gasoline Soft Drinks HQ-Headquarters Chinese Provin- W-Warehouse B-Main Installation Type of Trade Areas and Chamber cial Poblacion2/ BP-Branch D-Depot Center Trade Centers Commercel/Capitall/(population) Plant Co. 1 Co. 2 Co. 3 Remarks

Zamboanga del Norte

Minor Siocon * 2,922 Labasona/ * 2,729 Zamboanga del Sur

Minor Kabasalang 4,856 Alicia * n.a. Malangas 2,366 Coal mining MargosatubigbW * 11,987 Basilan Island

Minor Isabela * 5,168 W D Lamitan * 10,198 Sulu

Major Jolo * * n.a. W VI. Unassigned Territory

Zamboanga-Manila- Cebu Orientation Cotabato Major Cotabato * * 8,909 w D: a/ For remainder of province see Cebu territory. b/ For other centers in province see unassigned territory at end of table. Table VIII-I (Continued)

TRADE CENTERS AND TRIBUTARY AREAS, PHILIPPINES

Gasoline Soft Drinks HQ-Headquarters Chinese Provin- W-Warehouse B-Main Installation Type of Trade Areas and Chamber cial - Poblacion2/ BP-Branch D-Depot Center Trade Centers Commercel/Capital.l/(population) Plant Co. 1 Co. 2 Co. 3/ Remarks Cotabato (Cont.)

Minor Parang 1,426 D Salaman 2,000(?) Lebak * n.a. Midsayap * 11,383 Dulauan * 16,376 CO Pikit * 518 Zamboanga del Sur

Major Pagadian * * 9,839 W D

Minor Dumalinao 9,684 Leabangan * 1,885 Molave * n.a.

Lanao

Secondary Malabang 2,377 Section IX

PASSENGER MOVEMENT Section IX

PASSENGER MOVEMENT

Because of the large volume of passenger travel, domestic movement of passengers requires more transport facilities than freight. This is particularly true on land where facilities are more specialized than are the multi-purpose ships.

Buses transport the largest volume and are the principal vehicles on the highways. Freight receipts of the two railroads are also less than passenger revenues, and passenger trains are more numerous than freight. Interisland shipping companies derive about 30 to 40 percent of their revenues from passenger movements. Passenger revenues account for over four-fifths of the total flight revenues of the Philippine Air Lines.

The Bases for Passenger Movement

In addition to the general movement of buyers, sellers, salesmen, and others associated with an exchange economy, the movement of passen­ gers is related to several special factors.

1. Extensive migration within the islands either from the provinces to the cities (especially Manila) or to mines, sugar fields, logging operations or other activities in search of work, or to new farming areas. Many of these movements are either seasonal as in migration of workers from Panay to Negros to harvest sugar, or temporary, as to mines or temporary construction projects.

2. As a corollary to permanent and temporary migrations, and far more important in generating transport demand, is the return movement of migrants to visit relatives periodically, or to participate in annual barrio festivals and the like. Most Manila residents appear to make frequent visits to their rela­ tives in Luzon or other island barrios. In the crowded Visayas, particularly Cebu and Bohol, many migrants to Mindanao and other points return home periodically, thus contributing heavy traffic to shipping. 3. Education is much sought after in the Philippines and generates much movement. In addition to public elementary and secondary schools, there are many colleges and private or parochial schools of all kinds throughout the islands, and particularly in Manila. Travel of students to and from schools is heavy, especially at the beginning and end of vacations.

4. Partly because of the marketing system, many passengers tradi­ tionally accompany their own goods for sale to city or town markets. Most of the buses therefore carry some freight as well as passengers. Interisland ship-passengers may carry any­ thing from handicrafts to live animals.

5. Because of centralization of government and various social services in Manila, there is a considerable volume of travel to transact social, political, and medical affairs. Much of this movement could be avoided if services were more widespread among the provincial capitals and other population centers. For example, medical service is found only in the municipal poblaci6n; more specialized services are even less widespread.

6. Passenger service, although not of high quality, is abundant and cheap. Most of the passengers travel third class; they can be accommodated cheaply because the buses are heavily loaded. Average rates by bus are only one to one and one-half centavos a kilometer on good highways, up to two and one-half or more on poor highways. Buses serve almost every point ac­ cessible by even poor roads, and jeeps, jeepneys, horse calesas, and carabao carts penetrate to remote communities where roads are little better than trails. Third class interisland ship fares are 3 to 4 centavos a nautical mile; limited first class accommodations range from 8 to 10 centavos. The passenger kilometer rate in the Philippines is generally lower than the ton-kilometer rate. This is partly a reflection of the limited bulk cargo movements and short hauls. The situation neverthe­ less appears to be the reverse of the relationship in the United States where average rail freight rates per ton-mile are only about one half passenger-mile rates.

7. Finally a negative factor, the movement of much heavy freight into international trade rather than domestic, leaves relatively little for domestic freight movement. The international traffic flows of the Philippines are predominantly freight; the emphasis and nature of the problems of international shipping, therefore, differ to this extent from domestic transport.

336 The Traffic Flow Pattern

The flow pattern is difficult to determine quantitatively, but some of the elements have been noted above. The two large generators of traffic are the cities of Manila and Cebu. Manila, the economic and political center, has nearly two million inhabitants, and is the great magnet drawing highway, rail, and water traffic. Cebu City, the second largest center (200,000 metropolitan population), is a less important traffic generator. Manila, on the basis of revised estimates, which are more accurate Than customs figures, has about 300,000 outbound pas­ sengers by ship a year. Although Cebu City has only about 200,000 out­ bound passengers as reported by customs manifests, it probably originates more actual passengers than Manila, especially if the short hauls to Bohol and the nearby Visayas are included. Manila, on the large and populous island of Luzon, has far more land traffic than any other city. The Manila Railroad carries more than 8,000,000 rail passengers a year, a large proportion of which originate or terminate in Manila, and trans­ port many times this number.

The volume of vehicle traffic, mostly buses, operating on the prin­ cipal highways is shown in the highway traffic flow map (see Figure IX-30 at the end of this section). Manila's dominance is apparent. Short hauls to numerous other trade centers, mostly provincial capitals, are also apparent and are considered in the previous section on trade areas.

The next largest concentration of passenger traffic is in the sugar producing area of Negros Occidental, of which Bacolod is the center. Cebu, Iloilo, Davao, the coast of northwestern Luzon around Laoag and Vigan, and Dagupin; and the Bicol provinces also have relatively heavy passenger volumes, as does the Malig Valley of Isabela Province in the Cagayan Valley. Lesser but still important concentrations are in Tacloban and Ormoc on Leyte; Roxas on Panay; Tagbilaran on Bohol; Dumaguete-Bais on Negros; and Butuan, Cagayan, Iligan-Dansalan, Ozamis, and Dipolog on northern Mindanao, to mention but a few. Volumes under 100 are not discernible from the chart, so that the numerous concentra­ tions around local trade centers are not apparent. The disconnected nature of the flow pattern is nevertheless clearly apparent. This is a normal highway density characteristic, since highways are preeminently short haul movers.

337 Land movement of passengers is many times the volume of passenger movement by water, but all of the islands are also well interconnected by passenger flows, reflecting an integration of the Philippine nation on this level that is far greater than that created by the movement of most basic export commodities. (See Figure IX-30.) Legend

40011

NOTE: All national roads including other important provincial roads with 200 or more vehicles daily are shown.

SOURCE: Programming and Planning Division Bureau of Public Highways.

FIG. IX-30 TRAFFIC FLOW MAP, PHILIPPINES, 1954 (ANNUAL AVERAGE DAILY TRAFFIC) 339