Supply Analysis of Eggplant in the Philippines, 2011-2019

Date

6-2022

Degree

Bachelor of Science in Agricultural Economics

College

College of Economics and Management (CEM)

Adviser/Committee Chair

Carolyn D. Jimenez

Committee Member

Carolyn D. Jimenez, Julieta A. Delos Reyes, Agham C. Cuevas

Abstract

Eggplant (Solanum melongena Linn.), locally known as “talong,” is one of the economically important vegetables consumed and produced in the Philippines. It is a good source of vitamins and minerals, which are found helpful in the cure of diseases like cancer, inflammation, and asthma. Eggplant is also considered one of the most inexpensive and profitable vegetable crops grown in the country. From 2015 to 2019, eggplant contributed to 0.28 percent value of production of the Philippine crop sector.

This study analyzed the regional data on eggplant supply from 2011 to 2019 in the Philippines. The specific objectives of the study were to: (1) determine and analyze the trends in domestic eggplant supply; (2) analyze the different factors affecting the supply of eggplant in the Philippines; (3) identify the problems in the eggplant industry; and (4) provide policy recommendations based on the results of the study.

The methods used to answer the objectives of the study were descriptive, trend, and econometric (i.e., Pooled OLS, fixed-effects model, and random effects model) analyses. The Breusch-Pagan LM Test for RE and Hausman Test were used to select the best model for the panel data. Meanwhile, Akaike’s information criterion (AIC) was used to identify which between the linear and double-log functional forms better represents the eggplant Supply.

It was found that the national yield of eggplant (mt/ha) is generally increasing, with an average growth rate of 2.87 percent, from 2011 to 2019. Possible reasons for the trend are the early control of pests and diseases, sustained use of high-yielding eggplant varieties, adoption of a crop diversification scheme, and seed distribution by the local government units (LGUs) and the Department of Agriculture (DA). The top five producing regions of eggplant in 2019 were Ilocos Region (30.69%), CALABARZON (12.49%), Central Luzon (11.59%), Cagayan Valley (7.38%), and Western Visayas (6.63%).

Real prices of eggplant, okra, labor, and fertilizers increased from 2011 to 2019. Price increase of eggplant and okra can be attributed to the regional market supply and demand situation, seasonality of crops, and environmental factors such as changes in the amount of rainfall and temperature. Meanwhile, an increase in labor prices can be attributed to the migration of farm workers from agricultural to non-agricultural sectors in the country. In the case of fertilizer inputs, the soaring prices of this input could be due to surging input costs, supply disruptions caused by sanctions, trade restrictions, and high

transportation costs.

The Breusch-Pagan LM and Hausman Tests revealed that the fixed effects model is the best regression model for the panel data of eggplant supply. Meanwhile, the AIC showed that double-log is the better functional form for eggplant supply. Results show that there were two significant determinants of eggplant supply, namely: own price and price of fertilizer. The own price of eggplant has a positive influence on eggplant supply. In contrast, the price of fertilizers has a negative effect on eggplant supply. Based on the above findings, the study recommends the following: (a) provide financial assistance for inputs, particularly fertilizers to eggplant farmers and (b) provide programs or interventions that could further increase the prices of eggplant.

Language

English

LC Subject

Supply

Location

UPLB College of Economics and Management (CEM)

Call Number

LG 993.5 2022 A14 G85

Document Type

Thesis

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