THE controversy over the dubious fact that the Philippines continues to import about 90 percent of its salt requirement continues, with the latest salvos being fired between the Department of Agriculture (DA) and its Bureau of Fisheries and Aquatic Resources (BFAR). BFAR claimed in congressional hearings that P100 million in funding had been allocated last year for salt sector development; the DA, on the other hand, represented by rowdy Senior Undersecretary Domingo Panganiban, said he had ordered the BFAR to "find" the P100 million in funds, as the results of it having been spent as intended are not apparent.
Watching agri officials, so-called advocates and legislators quibble over the salt issue is becoming increasingly frustrating because none of what they are actually proposing will actually work. It's like watching a bunch of dummies trying to figure out how to get a brick to fly, and having no ideas other than, "try throwing it harder this time." Basic math will defeat them every time, and the only drama in it is wondering how long it will take them to catch on, or if they are even capable of doing so.
Here is some basic math applied to the salt issue directly to illustrate just how wide off the mark current policy thinking is. Raw salt, or in other words, the basic form that is produced by small-scale Filipino saltmakers, has a price of about $33 per metric ton, or about P1,856 at the current exchange rate. If it costs much more than that, it's overpriced, and the country should import salt instead. But, to give local producers the benefit of the doubt, make a fairer comparison with import prices (which would be a bit higher because of shipping and handling costs), and make our math a bit easier, let's say the price of domestically produced salt is $40 per metric ton, or about P2,250.
According to a recent statement by the Philippine Chamber of Agriculture and Food (PCAF), there "used to be" about 50,000 salt workers in the Philippines. According to information from the DA and the Department of Trade and Industry, the annual salt demand of the country is about 600,000 metric tons. The amount of raw salt needed to produce that much refined salt would be slightly higher as some is lost in processing, but apparently not much, so we can disregard that difference for the sake of simplicity. The implication of PCAF's complaint is that the demand would be fully met if all 50,000 salt workers were employed. Thus, each worker on average produces 12 metric tons of salt per year.
At P2,250 per metric ton, and assuming the individual worker actually retains that full amount, that means the annual income per worker is just P27,000 per year. The recent poverty statistics released by the Philippine Statistics Authority set the poverty threshold at P28,996 per year (P14,498 per half year, is how PSA described it specifically).
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For the agriculture sector, the average real minimum wage is P324.21 per day based on the latest data posted on the website of the Department of Labor and Employment, which works out to P118,338 per year. Whether that is dignified living wage is debatable; I personally wouldn't think so, but those are the hard numbers we have to work with, so we'll set the debate aside for now and presume that's a reasonable benchmark. In order to earn that amount, an individual salt worker would have to produce 52.6 metric tons of salt per year (at our optimistic price of $40 or P2,250 per ton), or 64.5 metric tons at the lower and probably more realistic price of $33 per metric ton; in other words, the saltmakers' productivity would have to increase four- or five-fold to earn a minimally decent living.
And of course, if saltmakers were that productive, the country wouldn't need 50,000 of them. The domestic demand could be met by 9,300 to 11,400 individual saltmakers, with any surplus produced — either through their being even more productive, or by adding saltmakers — being available for the export market. It would be important in that case, however, to make sure that the export market actually exists; otherwise a glut in domestic supply would develop, and prices would drop.
It would be possible to increase salt productivity by that much, but probably not based on the common method of salt production used now in the Philippines, which is the evaporation method. That method involves spreading seawater in large, shallow ponds and letting the sun evaporate the water; in order to produce more, more land area is needed for bigger ponds. The other available method, vacuum pan evaporation, is much more complicated and only cost-effective on an industrial scale, putting it completely out of reach of the quaint ideal of the small salt farmer. The method does have some advantages, however; it is not vulnerable to weather, as evaporation ponds are, and produces a very high-grade salt product.
Let me repeat again what I said in Thursday's column, louder, for the people in the back row: If the Philippines is serious in its intention to produce enough salt to meet domestic demand, without even considering an exportable surplus, then the only way to achieve that is to industrialize salt production. Repealing the ASIN Law and dispensing with salt iodization will accomplish nothing, and neither will throwing P100 million, or P1 billion, or P10 billion at programs to support small-holder salt production. The plaintive argument by so-called advocates of the salt industry that "the Philippines used to produce all the salt it needs" rather stupidly ignores the reality that the population has grown and modernized significantly since the time that assertion was last true. Using 16th-century methods to meet 21st-century demand is obviously not working; there is no reason at all to believe that doing more of the same is somehow going to yield a positive outcome.
The choice for agricultural policy-makers is simple, and comes down to three options. The country can either go all-in on salt and build factory-scale production; it can give up on salt production entirely, except as a tiny craft product niche pursued by a few people, and import all its basic requirements; or it can continue doing what it's already doing, keeping several thousand families in inescapable poverty despite making a show of concern for their well-being, while complaining about having to import salt anyway. Either of the first two options works, and the first better than the second; given the history of agricultural policy over the past several decades, however, and the thinking revealed by the inanities recently aired by officials responsible for solving the salt dilemma, I'd put my money on them choosing the third.