Philippines agricultural land

In my last post I highlighted the positive outlook for the Philippines economy and suggested agriculture as one of the positive growth areas.
Philippines food output in recent has struggled because of the low returns. The biggest problems have been:
1. Drought over much of the Philippines has diminished output
2. Low food prices has discouraged production
3. Poor work practices and low worker productivity ensure low wages

The outlook is set to change. Food prices are on the increase. With asset prices coming off basic cost of living items like food are set to increase as demand factors restore the price imbalance in favour od food. There is also the important role that changing diets in developing countries, not to forget the greater consumption of food as these countries increase their food consumption with their evolving prosperity.

The implication is that whilst Philippines food exports have not been generally competitive, there is reason to expect that will change for a number of reasons:
1. Food prices are on the increase
2. Asian food demand is on the increase

A return to higher income yields seems assured to generate more interest in the acquisition of productive land in the Philippines. Already the trend is underway. The question is how best to acquire it. I would suggest that there is plenty of land for sale in the Philippines through the foreclosed property route. Agricultural land is cheap because zoning rules prevent it from being readily turned into development land, as is come practice in other countries. Tenant farmers have however shown little interest in farming such lands in recent years, so much of it has remained idle, despite the reliable rainfall in many areas. More information at my foreclosed property blog.
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Andrew Sheldon www.sheldonthinks.com