Cassava Production, Processing and Marketing of Granules

Location

  • North Bukidnon ARC Cluster I
  • Mantibugao and Brgy. Lunocan, Manolo Fortich and Brgy. San Jose, Brgy. Capihan and Brgy. Nangka, Libona
  • Bukidnon
Baseline Profile

North Bukidnon ARC Cluster 1 covers two (2) municipalities, Libona and Manolo Fortich.

The North Bukidnon cluster is classified as flat to undulating. Nearly half (46 percent) of the cluster is covered with Adtuyon Clay, found at the center part of the cluster. Almost a third (31 percent) is mountain soil, located at the southern part of the cluster. Other soil types present in the area are Jasaan clay, Bolina clay, Alimodian clay, and Kidapawan clay.

The climate in the area is Type III or intermediate “A” type with no pronounced maximum rain period and a short dry season. Rainfall peaks during the months of May to August and starts to lessen by September. Dry months are experienced from February to April, with March as the driest.

The total population in the cluster is 92,049, derived from 18,377 households with an average size of 5 members per household. The total ARBs present in the area is 6,457, majority are men (3,778). By ethnicity, most belonged to the Bukidnon (85.32 percent) ethnic group, followed by the Dumagat (12.37 percent) and the Manobo/Higaonan (2.31 percent).

Development Issues

North Bukidnon ARC cluster, particularly its local cassava industry in Manolo Fortich and Libona, identifies the lack of post-harvest facilities as its utmost concern. Solar drying, chipping and granulating machines are essentials in producing quality cassava chips and granules.

The downstream industries of cassava require chips and granules reduced to 14% moisture content or lower – since fresh cassava contains as much as 70 percent water. Because of its sheer volume (an average of 30 metric tons per hectare in one cropping cycle of 8 to 12 months), the need for drying facilities is immense. Sun or solar drying is the most economical method and it will take typically five (5) days for a manually-sliced cassava to reach this moisture level. Most of the farmers that do not have access to dryers resort to drying their products using tarpaulin or worse, directly on top of soil. The effects of inappropriate or insufficient drying are easily noticeable, preventing the farmers from securing the best price for their products.

Low and uneven quality also dampens the likelihood of the farmers or their cooperatives to secure a sustainable supply arrangement with premium institutional buyers.

Other equally-restricting factors are the lack of production capital to pay for the inputs (i.e. fertilizer) and capability-building activities to better manage and sustain the enterprise projects.

Goals and Objective

The main goal of the value chain enhancement project for cassava-producing ARBs and cooperatives in Manolo Fortich (specifically the barangays of Mantibugao and Lunocan) and Libona (Barangays San Jose, Nangka and Capihan) is to realize a “competitive, profitable and sustainable local cassava industry”.  With this as a guide, the development objectives are:

  • Increase the farm incomes of cassava-producing ARBs and cooperatives
  • Improve the community-level supply chain of quality cassava products
  • Mechanisms to further work on value added products derived from cassava

Project Targets

  • Increase in income, from Php 77,000 to Php 132,00 by year 5
  • Create employment and livelihood opportunities to at least 46 (direct labors) by year 5
  • Increase in production volume, from an average of 30 metric tons per hectare to at least 36 metric tons by year 5
  • Provide access to at least three types of post-harvest facilities (solar dryers, chipping machine and granulator)

Increase the livelihood and income diversification options through more sustainable market arrangements, intercropping and other income diversification options including more value added options for the cassava growers.

Strategies

This project emanates from the cassava market and value chain analysis of North Bukidnon Cluster 1, focusing on the three cassava-producing cooperatives. The local cassava value chain is short and simple –from the input suppliers of fertilizers, to three types of farmers (producing fresh tubers, in chips and in granules), to local assemblers/consolidators, and then to starch producers, feed millers and cattle rancher/breeders as the final users (at least in Bukidnon). Supporting the chain by way of providing technical, financial and infrastructure services are the national government agencies such as DAR, DA, DTI, DOLE, local government units, local cooperative bank and traders.

The demand for cassava has been growing exponentially – driven by increasing population and changing diet, expanding range of products made from the crop, growing concern for the environment (ethanol and biodegradable plastics), and adapting to unpredictable weather events (drought-tolerant crop). Worldwide, the product is hardly traded because production is barely enough to cater to each country’s need. In the Philippines, the private sector estimates a 20% growth in demand yet the local industry is only achieving 3% upward movement. In Bukidnon, local buyers can accommodate a 40,000-hectare production, but the current land area is a little over 2,200 hectares. This demand does not include other starch processors located outside of the province (e.g. Philippine Starch Corporation based in Bohol).

While the market appears to be vibrant, not all farmers are able to maximize the opportunity because of quality requirements. They have the option to sell cassava as fresh tubers, but if their yield is low, they will not likely make any profit. Selling fresh tubers is good if the yield is optimum (say, 60 tons per hectare). The second option is to sell cassava in chips form, but they have to achieve the quality required by the buyers (feed millers and starch producers) – even and “clean” drying at 14% moisture content or lower. The third option is to sell cassava in granules, which is less prone to deductions (quality is evened-out), sell a little higher but requires additional activity and transport cost.

Linked to achieving quality is efficiency – not only in terms of yield but also in access to drying and chipping activities. There are farmers who are able to harvest 40 to 60 tons, while the average is 30 tons and the lowest is 10 tons per hectare. With proper production support (capital), high-yielding varieties, and appropriate crop and soil management, optimum yield is possible. However, there is little solar drying space available that most farmers are forced to dry their chips on any surface. The improper drying is penalized with deductions ranging from 10 to 40% of the prevailing price.
Securing a sustainable share in the local market hinges on volume, quality and delivery. The cooperatives need to work together and orchestrate their activities, taking smaller steps as they build their capacity and confidence to respond to the requirements of the market.

Cassava can contribute in realizing inclusive growth as it requires relatively low investment from small holders. Labor presents two-thirds (66%) of the investment cost, creating employment opportunities. If the cassava is sliced manually, it also provides work for women and out-of-school youth children. The strategies and activities proposed in this project are considered low-risk but are leading towards more significant market transactions and upgrading activities. The direct provision of post-harvest facilities and capability-building interventions will be critical in the first year, responding to the inefficiencies and constraints of the local cassava value chain.

Investment Needs

The project will provide post-harvest facilities to serve about 350 hectares of cassava.
The five cooperatives to be included in the project have a combined land area of 1,429 hectares and almost half (49 percent or 709 hectares) of this area is planted with cassava. Technically in a year and using the average of 30 tons per hectare, the estimated volume of fresh tubers among these five cooperatives is 21,270 tons annually. Therefore, there is adequate volume of raw materials to be processed by the project. This can further be increase if the non-ARBs and other cooperatives will have their cassava chipped, dried and granulated by the project since the total land area planted to cassava for the entire cluster is 2,196 hectares.
For each solar dryer, there will be one chipping machines assigned, with a capacity of 1 metric ton per hour. The chipping machine will be powered by an air-cooled diesel engine, made of steel and with high-tensile/quality chipping blades. There will also be one granulator to be operated by MARBFC, with the proposed capacity of 10 metric tons for every 8 hours.
To house the chipping machines as well as the packed dried chips in sacks, there will be an adjacent mini-warehouse/shed. It will have a dimension of 10 x 15 square meters.
In addition to the facilities, each solar dryer will have some useful tool such as wheelbarrow (3 units), shovel (6 units), plastic drums (2 units) and a weighing scale with 500-kilo capacity.

Market and Opportunities

From the market perspective, planting cassava is a worthy investment – with the demand is far outstripping supply, from the local to international market. In Manolo Fortich and Libona where the five (5) cooperatives in focus of this project study are located, the existing land area devoted to cassava, both in ARB and non-ARB barangays, is a little over 2,000 hectares. The five cooperatives have a combined land area of 709 hectares. BMeg representative in Bukidnon has a quota good for 3,000 hectares but at present has only managed to fill 1,500 hectares. Global Agro Milling Corporation, a large-scale feed milling and tolling company has a massive granulator machine that can take in as much as 80 metric tons a day, but they are not operating in full capacity. These two companies alone have revealed that they can absorb as much the cassava production equivalent to 20,000 hectares each. In addition, there are also Bukidnon-based cassava starch processing operations, such as the Bio-Green Processing and Manufacturing Inc. (Sumilao), the Phil-Agro Industrial Corporation (Baungon) and the Aznar Agro-Industrial Corporation (Baungon).

Gender, Youth and Indigenous Peoples

The membership base of the five cooperatives is skewed more on males. However, there are women who hold key positions in the cooperative. For instance, LARB is headed by a female chairman. Women take part in the important decision-making activities. They are also represented in community processes, where the issues of cassava production are taken up.

In terms of activities at the farm level, women labor takes the bulk of the planting and chipping work. There are also activities that are gender-neutral, such as preparation of the land, fertilizer application, weeding and harvesting.

The project also emphasis 15% IP integration either in the enterprise or as beneficiaries of infrastructure facilities.

Expected Outcomes

The income of individual cassava farmer will be positively affected by the project.  With the provision of chipping machine farmers will be able to sell their produce into chips which has a greater value than fresh tubers.    Currently farmer’s produce were dried on top of soil which results to low quality chips with soil contaminants. With the   solar drier that will be provided by the project   there will be no reduction cost   on the chips hence increase their income. Production technology is also a factor that increase the income of the farmers, this production technology will be catered to the beneficiaries through capability trainings and workshops. And lastly the farmers will receive an additional share from the cooperative through patronage and dividend.

Further, these ARBs will also benefit from the following:

  • Expanded market – The beneficiaries will be able to serve more than the individual traders/buying agents – that through the project cater to BMeg and other institutional buyers (within or outside the province) that the project will be able to obtain.
  • Positioned the cluster (5 cooperatives) in the market for long-term growth – With a specific goal to realize and with the medium-term support from Project ConVERGE, the five cooperatives will be able to secure foothold in the local supply market. The productivity and quality, coupled with efficient and consistent delivery to the market, will permit the cooperatives to be known as important supplier of cassava.
  • Reduced costs – The consolidation effort of the project will allow the cooperatives to save on fertilizers and transaction costs, among others.
  • Improved product – The research, development and extension activities will improve the quality of cassava, possibly fetching higher price.

Increased motivation among cooperatives and ARBs – The increased in farm income and improved relationships will motivate the ARBs and cooperatives to work together.

Sustainability Measures

The project sustainability will largely depend on the involvement and commitment of the five cooperatives from Nangka, San Jose and Kapihan in Libona and Mantibugao and Lunocan in Manolo Fortich; all in the Northern Cluster of Bukidnon. The coops involved would be under an umbrella group SANAMALUN Federation (San Jose, Nangka, Mantibugao, Kapihan Lunucan) where they already even have their sets of officers for this entity. At the first instance, sustainability will be based on how responsive are the proposed interventions based on the expressed needs and absorptive capacity of the cooperatives.  The identification of their main problems and the proposed solutions were born out of consultation with the ARBs and officers of the cooperatives.  The pacing of the activities will also depend on how well the cooperatives have been able to select, prioritize and implement solutions.  For instance, the project will use the first year on trust-building and on laying down the basic procedures/scheduling on the use of the ConVERGE-provided facilities.

Second, the participation of the ARBs and other cassava value chain stakeholders will be important.  There will be occasions and events where they will be brought together to arrive at common understanding, common goals and common activities.  As earlier mention, there will be planning and assessment activities, field farmer days, information sharing and cross visits.

Third is the appropriateness of technology and methodologies.  For the production side, the PFR will give enough room for the farmers to choose the right mix of modern and traditional technologies to use.  The use of farmer-to-farmer extension will strengthen the skills and knowledge of selected farmer-technicians, allowing them to reach more beneficiaries in the future even after end of the project.

A financial resource is the fourth sustainability element.  Financial transparency and accountability will be promoted within the five cooperatives.  Operational costs, particularly in the operation of the facilities, will be properly recorded and reported.  Certain amount will also be set aside for the maintenance.

The transfer and honing of technical and managerial skills will also contribute in sustaining the activities and broadening the impact of the project.

Finally from the economic perspective, ARBs who have experience higher income or increased project benefits will likely continue doing what they learn from the project. As long as the market demand is there, the project will likely be sustainable.

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