The Department of Agriculture (DA) is stepping up efforts to expand the country’s oil palm industry, with Mindanao positioned at the center of a plan aimed at cutting imports and raising farm incomes.

DA secretary Francisco P. Tiu Laurel Jr. said the agency intends to substantially increase funding for oil palm development in 2027, after this year’s proposed P1 billion budget was reduced to P79 million. For next year, the department is targeting a P1.2 billion allocation to support fertilizer distribution, expand plantation areas, and improve productivity.

“Let’s invest where farmers earn,” Tiu Laurel said during a strategy meeting, stressing that government spending should follow profitability data.

Current figures show oil palm yielding an average of 3.8 metric tons per hectare, far higher than coconut’s output of less than one metric ton per hectare. Because of this yield gap, oil palm growers earn at least twice the roughly P90,000 annual income of coconut farmers, according to data cited by the department.

The Philippine Coconut Authority is also laying the groundwork to strengthen planting material supply. Administrator Dexter Buted said the agency plans to establish oil palm nurseries in selected areas in Caraga through government-to-government importation of germinated seeds.

“The PCA is planning to establish oil palm nurseries in selected areas in the Caraga region through the importation of germinated seeds under government-to-government arrangements,” Buted said, noting that the move is expected to significantly reduce the cost of imported planting materials.

Oil palm plantations now span about 100,000 hectares nationwide, the bulk of them located in Mindanao. Despite this, the Philippines still relies heavily on imported palm oil to meet rising demand for cooking oil, contributing to pressure on the trade balance.

To address supply constraints, the DA is considering the University of Southern Mindanao in Kabacan, North Cotabato, as a base for reviving and expanding a state-supported nursery. The department plans to source high-quality, disease-free planting materials from Malaysia to ensure stronger yields.

At the same time, Tiu Laurel acknowledged weaknesses in industry statistics that could affect planning. “We need to fix the data to optimize our investment in this crop,” he said.

The country currently has 11 palm oil mills and five refineries, including a modern P600 million facility in Sultan Kudarat financed with support from the Land Bank of the Philippines and the DA.

With domestic consumption climbing and imports continuing to fill supply gaps, the agriculture department is positioning palm oil as a key growth area. Officials believe that scaling up production in Mindanao could improve farmer earnings while strengthening the country’s edible oil security.