Northern Mindanao vegetable growers set sights on big markets

MALAYBALAY, Bukidnon – Faced with the challenge of transforming smallholder farms into market-focused and highly commercial areas, the Northern Mindanao Vegetable Producers Association Incorporated (Normin Veggies) vowed to increase their ranks and pursue a united approach to penetrate bigger domestic and international markets.

"From our experience, we know that our goal of increasing the shipment of vegetables from Mindanao can be achieved, but only if growers harmonize logistics and marketing strategies," Normin Veggies president Marcelino Remotigue said at the 1st Northern Mindanao Vegetable Congress.

Co-organized by USAID’s Growth with Equity in Mindanao (GEM) 2 program, the conference attracted vegetable growers from as far as Benguet. The Congress underscored the importance of expanding agribusiness opportunities for the vegetable industry in Northern Mindanao.

Normin Veggies grower-members presently ship 75 percent of their annual production of 250 metric tons to institutional buyers such as supermarkets, hotels, restaurants, and fast food chains. The balance is sold to the local wet markets, but at considerably lower prices.

Every year, grower-members of NorminVeggies also jointly market up to 150 tons of broccoli, 100 tons of cabbage and carrots, and 500 tons of table tomatoes to buyers in Manila, Cebu, and at local markets.

Joint Marketing As A Strategy

The group sees joint marketing by vegetable growers as an effective way to address the concerns of the sector, among them high logistics cost and the absence of an efficient marketing scheme. Joint marketing enables producers to meet the market demand, reduce costs, as well as maximize growers’ profit.

"There is no way we can get a better market share if we do not work together. Buyers want stable and reliable supply and no single grower can address the needs of the market," says NorminVeggies resource mobilization officer Joan Uy, an independent grower and a member of the lettuce cluster.

While a few members of the NorminVeggies are corporate farms, which can handle integrated operations from production to logistics to marketing, most members are smallholder farm producers.

Under the present set up, these several independent growers join together to grow and market high value vegetables. There are 10 independent growers of lettuce and 12 producers of each for the other major crops.

Each team consolidates its produce to supply the needs of an identified market, mostly institutional buyers. Uy says cluster members must share best production and post production practices to ensure both quantity and quality of produce. Members of the cluster also produce more than enough to meet the buyers’ need in order to ensure adequate supply. "Besides, working as a group helps small farmers reduce their costs since each pays only for that portion of the out-shipment cost which corresponds to the volume that the grower contributed to the total output," Uy adds.

Current Market Trends

Uy, who serves as the marketing manager for NorminCorp, the marketing arm of NorminVeggies, says the vegetable industry is affected by factors such as globalization, the speed and sophistication of production and post production technologies, and fragmentation of markets.

With the advent of globalization, Uy says growers must be able to produce leafy greens that meet international phytosanitary standards. By pooling their resources, according to Uy, growers can better acquire state of the art technology to address this new global requirement.

"Buyers have become much more discriminating about quality and price. Consequently, growers must dedicate themselves to producing high quality vegetables," Uy adds.

NorminVeggies, with assistance from local government was instrumental in establishing the Agro Industrial Trade Center (AITC) in Bukidnon which will house a grains center, vegetable landing area, livestock auction area, commercial spaces, and a transport terminal. The AITC will also house cold chain facilities to maintain the freshness of vegetable and other perishable commodities thereby minimizing post harvest losses.

In December 2003, vegetable industry stakeholders also inaugurated a cold storage facility at the Livecor complex in Mandaluyong City, which can store up to 3.5 metric tons of high value vegetables from Mindanao. From this facility, commodities are re-distributed to individual retailers and institutional markets in Metro Manila.

This complements earlier efforts of USAID’s Growth with Equity in Mindanao (GEM) 2 program, working in partnership with the Department of Agriculture (DA), University of the Philippines Los Baños and the Department of Trade and Industry (DTI), to operationalize the national cold chain program which aims to have vegetables reach consumers as fresh as when they were harvested.

NorminVeggies is consulting with prospective clients regarding preferred varieties and quality specifications for specific commodities. By responding to these demands, and meeting the highest standards of the market, NorminVeggies hopes to change grower attitudes and practices.

The group also plans to create a cluster map, a quality assurance plan, an efficient production management strategy, an in-depth value chain analysis and a code of business conduct to make the sector globally-competitive.

Creating Unity Among Growers

In its effort to fast track the development of the vegetable industry, NorminVeggies is planning to enlist more members. Dante Sarraga Jr., NorminVeggies Government Liaison Officer indicates that the group is planning to organize vegetable farmers at the barangay level. He says the group will recruit one representative for each of the region’s 2,000 barangays. Initially composed of 15 vegetable growers in 1999, the organization has 90 members at present. – Enriquez-Uayan, GEM Program