Big corporates and small farmers

Perhaps the message is finally being heard. The big corporates must help small farmers because we are all in this together. Given that the government’s agriculture department seems lost, only the more organized and better financed conglomerates can step in and fill the gap. President Marcos said as much in launching yet another program of GoNegosyo. But GoNegosyo’s focus is on MSMEs. The President was correct to refocus on the small farmers. Because before the MSMEs, the farmers must produce first.

The President stressed the importance of letting the farmers make money from their work. “In the end, this is about giving a decent living to our farmers, so they can live by the virtue of their hard work.”

Any serious food production program must make sure the farmers earn enough to feed and educate their families. Everyone makes money on the back of the farmers’ labor, from the traders to the retailers and commercial users of farm produce. The farmers are badly exploited.

There are many ways of helping the farmers. Beyond planting and harvesting, they need good post-harvest facilities to reduce spoilage and give farmers a fighting chance to get fair farmgate prices from the traders.

I am told that we lose as much as 40 percent of agricultural production due to spoilage. That’s a significantly large volume to lose. For the farmer, it could mean the difference between hunger or having enough to live on for the rest of the year.

During the pandemic, ordinary citizens from urban areas tried to help farmers and poor consumers by organizing community pantries. San Miguel Corporation worked with Rural Rising Ph to help 4500 farmers struggling to sell their harvests. It also provided consumers with fruits and vegetables at affordable prices through the company’s Better World Diliman community center.

From the 1.7 million kilos “rescued”, Better World Diliman donated over 14,000 kgs of agricultural produce, including sayote, cabbage, lemons, watermelon to Tondo-based communities. SMC’s program also helped prevent food waste. These are all good civic conscious responses, but hardly enough nor sustainable.

What the big corporates must do to sustainably help is to include the small farmers in their supply chain. San Miguel also did something along that line. San Miguel Foods Inc. ramped up local corn purchases from farmer cooperatives nationwide after quarantine protocols and disruptions in transportation limited their ability to sell their produce. This helped guarantee off-take for corn farmers and at same time secured SMFI’s supply of raw materials. Making corn farmers part of SMC’s supply chain is how to help them.

Magnolia ice cream is also using a lot of carabao milk instead of imported milk. Not only are their products better tasting, using carabao milk gives rice farmers additional income. If more farmers sell carabao milk to Magnolia, the farmers will become part of Magnolia’s supply chain. This is sustainable assistance, not a one-time thing just meant for public relations imaging.

I have written here about Jollibee’s program with Nueva Ecija potato farmers. Jollibee provides the farmers with technical help to grow the potatoes to the standards and quality they need. Then Jollibee guarantees the farmers a ready market for all their potatoes soon after harvest. That’s another good example of making the farmer part of the supply chain of a big corporate that Jollibee is.

Universal Robina Corporation has a similar program in cooperation with the Canadian Embassy. I wrote about this last year, but it is worth recalling to illustrate how a big conglomerate can sustainably help our farmers beyond one-time PR-driven token assistance.

A group of farmers went on a five-day training course in Canada as part of URC’s collaboration with the Prince Edward Island Potato Board. There, they learned new techniques on seeding and planting, soil management, storage, and other key practices.

As part of the program, URC imported Granola potato seed from Canada for dissemination to several farming communities. The program has helped growers increase their yield. Benguet potato farmers reported a double yield with the use of Canadian seed potatoes. Farmers reported harvesting an average of 20 tons, which at only P30 per kilo, could easily earn them P600,000 in just three months and 10 days.

The initiative for the program came from URC president Lance Gokongwei. He requested the DA for assistance in importing the chipping potato that local farmers do not grow and is needed by URC’s potato chip brand. That’s how the Canadians came in.

The seed variety was introduced through the Potato Development Program of the DA in partnership with URC. URC brought in 100 tons of G-3 potato planting materials from Prince Edward Island in Canada. These were distributed to farmers in Buguias, Benguet; Talakag, Bukidnon; and Kapatagan, Davao del Sur.

Part of the agreement is for URC, a subsidiary of JG Summit Holdings, to purchase medium-sized potatoes, while the large, extra-large, and marble potatoes will be sold in the open market. Robinsons Supermarket, also under JG Summit, will purchase the produce.

We often see pictures of farmers dumping their tomatoes and other produce on the roadside because they can’t get them to the markets. One way Ayala Corporation can help is to expand on the efforts of Air 21, which they recently acquired, to use the refrigerated vans delivering pharmaceuticals to the provinces. Air 21, under its old owner Bert Lina, used the return trip or back haul to NCR to ferry vegetables, which are delivered to Quiapo market where institutional buyers like restaurants and hotels source their requirements.

The SM Group that now owns 2Go can also help with the logistics of bringing farmers’ produce to markets, including their own supermarkets. SM can work with farmers cooperatives to provide this logistical support.

Metro Pacific, according to Manny Pangilinan, is thinking of re-entering the logistics business to complement their agri unit on which they are investing P8 billion.

I am sure there are other examples of how big conglomerates can help small farmers by making them part of the supply chain and helping with logistics. This is not charity or corporate social responsibility. This is business and it benefits everyone.