By means of Adrian H. Halili, News reporter
METRO PACIFIC Agro Ventures (MPAV), the agricultural unit of Metro Pacific Investments Corp. (MPIC), is investing in a dairy farm in Bukidnon to strengthen its dairy operations – a move that analysts expect will spur further investment in local dairy production.
“Establishing this strategic beachhead in Mindanao will complement our dairy farms in Luzon and bring us closer to our mission of achieving rural food security,” MPAV Chairman Manuel V. Pangilinan said in a statement Thursday.
MPAV said the acquisition of Universal Harvester Dairy Farms, Inc. (UHDFI) of more than P700 million is intended to support dairy demand in the Philippines. The company acquires 100% ownership of UHDFI.
In 2022, MPAV acquired an interest in The Laguna Creamery, Inc., owner of the Carmen’s Best ice cream and Holly’s Milk brands.
Mr. Pangilinan added that MPAV’s operations in Laguna have improved the accessibility of fresh dairy products and provided a stable market for dairy farmers.
“With our new investment in Bukidnon Milk Company, we expect to repeat this success in Mindanao and other regions of the country,” he said.
MPAV President and Chief Executive Officer Juan Victor I. Hernandez said the investment would allow the company to expand its distribution network.
“This is an important step for us to achieve our aspiration of becoming a master brand for dairy products, where we will provide the Filipino consumers with the full range of dairy products from ice cream, milk, yogurt, cheese, butter and other milk derivatives. products,” Mr. Hernandez added.
UHDFI operates under the brand name Bukidnon Milk Co. and produces dairy products for the Visayas and Mindanao markets. The company also supplies milk for the National Dairy Authority’s (NDA) milk feeding programme.
“We believe MPAV is the right partner to take our vision to the next level. This partnership will not only expand our reach but also improve the quality and range of dairy products available to Filipino consumers,” said UHDFI Founder Milagros Ong-How.
MPAV said the completion of the acquisition is still subject to regulatory approvals and other closing conditions.
Danilo V. Fausto, president of industry group Philippine Chamber of Agriculture and Food, Inc., said the company’s move to expand its dairy business could encourage other companies to invest in the dairy sector.
“But the effect of this will not be immediate. Dairying is a long-term business, so you have to increase your herd, improve your feed and nutrition, etc., before you can start producing milk,” Mr Fausto said during a telephone conversation.
“We would like to invite more investors into the sector. We import 99% of our milk and welcome such initiatives and investments from multinational companies,” he added.
The Philippines can meet less than 1% of its milk demand through domestic production, while the rest must be imported.
Dairy imports are expected to increase by 7.3% to 2.49 million tonnes of milk equivalent in 2024, according to a report from the Food and Agriculture Organization of the United Nations.
AP Securities, Inc. research head Alfred Benjamin R. Garcia said the acquisition would secure supply of Metro Pacific’s dairy products, Carmen’s Best.
“We hope that more companies will follow MPIC’s example and invest in the agricultural sector. Very few companies are investing meaningfully in this sector, which is unfortunate because food security is one of the biggest concerns facing the Philippines,” Mr. Garcia said in a Viber message.
Juan Paolo E. Colet, Managing Director of Chinabank Capital Corp. said investing in more dairies could boost local production and eventually reduce the country’s dependence on imported dairy.
“The key challenge is to produce affordable, high-quality local dairy products efficiently and at scale to meet local demand,” Mr Colet said in a Viber message.
He added that other companies may be hesitant to enter the dairy industry due to the substantial investments required in technology, infrastructure and logistics.
The NDA aims to increase dairy production to 80 million liters per year by 2028.
MPIC is one of First Pacific’s three main Philippine units, the others being Philex Mining Corp. and PLDT Inc.
Hastings Holdings, Inc., a part of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., holds a majority stake in Business through the Philippine Star Group, which it controls.