Small fruit farmers conquers global market
Wednesday, December 7, 2011
GENERAL SANTOS CITY — Many small fruit farmers and producers in developing countries aware of the quality control standards and volume requirements of buyers in the global food trade quickly decide that they can’t afford to compete.
But as a fruit growing association in the southern Philippines found out, in today’s highly diversified and fast-moving food trade, even small players can penetrate export markets and increase profits.
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The Tupi Papaya and Guava Growers’ Association (Tupagga), a 25-member cooperative with a production area of about 50 hectares, saw itself only as a supplier to markets in its home region of Mindanao, and in the national capital, Manila.
Earlier this year, the association, like other fruit growers, was in the doldrums after the Japan earthquake and tsunami caused a sharp drop in demand for tropical fruits. Multinational firms based in the Philippines which regularly supply the Japanese market dumped their shipments of tropical fruit in Manila, causing prices to slide.
Still, hoping to attract new domestic clients, Tupagga decided last May to attend the International Food Exposition (Ifex), an international food trade show in Manila, with assistance from the U.S. Agency for International Development (USAid), in partnership with the Department of Agriculture and the Mindanao Fruit Industry Council.
USAid, through its Growth with Equity in Mindanao (GEM) Program, which is implemented under the oversight of the Mindanao Development Authority, assists Mindanao growers’ cooperatives and associations to upgrade their production methods and post-handling techniques, while assisting them to identify lucrative domestic and export markets for their produce.
“It was our first time to attend a large trade show like Ifex, and we were looking for local buyers, thinking that the export market was beyond our capability,” said Ramon Mananasala, Tupagga’s chairman.
These perceptions changed quickly when a buyer from the Middle East visited their booth, and liked the sunrise variety of papaya he sampled.
“It had the sweetness he was looking for, and has a good shelf life,” said Manansala. USAid-GEM had earlier provided the association with training on updated farming technologies and introduced co-op members to new papaya varieties, including sunrise.
After visiting Tupagga’s production area in Mindanao, the buyer placed an order for a trial shipment of papaya to Dubai, for almost triple the value the fruit would have fetched on the domestic market.
“When I informed the other members about the order, at first they couldn’t believe it,” Manansala recalls. “They had thought the export market was beyond their reach.”
As they went along, the association members made use of vital lessons they’d already learned that would help them survive and thrive in the global market. They also gained new insights in the process of filling their first order.
Following up on marketing opportunities. The Ifex show may have been its initial exposure to global buyers, but the association was prepared with its marketing strategy.
For example, it provided the walk-in buyer from the Middle East with vital information about its production capability, invited him to visit the plantation in South Cotabato Province, and stressed the comparative advantages of Mindanao growers: a typhoon-free climate year-round, as well as the potential to expand the production area.
Consolidation is key. Their foray into export would not have been possible if the 25 farmers hadn’t organized themselves into an association, with encouragement from USAid-GEM.
This enabled them to synchronize their production and shipping schedules, and assured the buyer that his volume requirements would be met.
Quality control and post-harvest technology. Tuppaga found that quality control begins at the ground level. “For local markets, the fruit is sorted according to appearance, size and weight after it is harvested,” said Manansala.
“But for export markets, we begin classification while the fruit is still growing, and then repeat the process in the packing stage, so as to ensure good quality.”
The association also learned that quality controls vary from country to country. Most small fruit growers, for example, are unable to afford the vapor heat treatment (VHT) which is a prerequisite for exporting papaya, mango and other tropical fruits to countries with stringent phytosanitary requirements, like Japan.
But Tuppaga found that many markets in Asia and the Middle East allow the importation of mangoes which have been subjected to the simpler—and less costly—hot water treatment.
USAid-GEM introduced Tupagga to another growers’ group which has its own HWT facility, and which let Tupagga use the facility for fee.
Packaging and packing. The Middle East buyer supplied the association with the packaging materials for the first shipment, including cartons and fruit cups.
But the association members realized that they also had to invest in food-grade plastic crates to limit post-harvest bruising and help maintain the quality of the fruit during its overseas transport.
The members found themselves working late into the night sorting and packing their first delivery, just barely meeting the shipping schedule set by the buyer.
“Medyo magulo [It was a bit chaotic],” said Manansala, “But we could already see what improvements had to be made to speed up future shipments.”
Just two weeks after its first shipment to Dubai, Tupagga filled its second delivery order from the Middle East. By this time, the association had greatly improved its packing assembly line, and easily met its volume quota and shipment schedule, having learned important lessons from their first shipment.
Exhilarated, the association members have decided to invest their initial profits into production inputs, including improved fertilizers and higher grade packaging and packing materials.
“We’re already planning to revive production areas which had been temporarily left uncultivated after local prices for papaya dropped,” Manansala said. “We’re also looking into diversifying into organic bananas.”
Tupagga has proven that the export market for fruit is not exclusively the domain of contract growers and multinational firms. With the right skills and the right attitude, even small farmers can find their market niche. (PR)
Published in the Sun.Star Cagayan de Oro newspaper on December 07, 2011.
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