Cassava_VCA_the major stakeholders

There are five (5) major players along the chain from cassava fresh tubers to cassava granules via cassava chips: (1) the input suppliers, (2) the planters which are considered here as the farmer beneficiaries and the primary producers, (3) the assemblers, and (4) the consolidators, and (5) the market of the product. Their relationships are shown in Value Chain Map and how it moves vertically and horizontally.

There are at least eight (8) informal buyers known in Zamboanga del Sur, of which some of them, have local sourcing agents  that monitors harvestable cassava. Some of them sold their procured dried chips straight to the coop particularly local assemblers from District ll but in District 1 some opted to go direct to Ozamis City

In 2012 and 2013, based on their cashier’s report,  they received a total of 2,163,771 kg cassava chips from different local assemblers and walk-in client or individual farmers and delivered 2,261,486 kg cassava granules to SMFI at Ozamis City.

The cassava livelihood program involves planting of cassava and other high value commercial crops and vegetables in the upland areas, using locally produced organic fertilizers.  The program has provided farmers with gainful livelihood opportunities and helped them increased family income.  To support this initiative is the partnership forged by the Provincial Government with the San Miguel Corporation (SMC) where farmers delivered their cassava chips directly to the latter by virtue of a Memorandum of Agreement (MOA). Consequently, the use of organic fertilizers helps as soil conditioners.  

Cassava_Value Chain Analysis: Results and Discussions

A number of techniques to test performance agricultural commodity in the market are available like market integration, parity bound analysis, symmetry, error correction mechanisms and value chain analysis (VCA). Some studies used mathematical models including deterministic analytical models and stochastic models.

The VCA was performed because it is design to identify critical issues and constraints that undermine value chain development and identify business and technological opportunities that can enhance the performance and competitiveness of the sub-sector.

The first step done in mapping the market was delineating the value chain and simplifying it. At a glance, it was more complex than anticipated. The quantitative mapping  and the qualitative mapping showed the equation with inputs and outputs interacting with each other. As a result two value chains were mapped out: (1) Fresh Cassava Value Chain and (2) Dried Cassava Value Chain.  

NATURE AND STRUCTURE OF THE INDUSTRY

The bulk of world trade in cassava is in the form of pellets and chips for feed (70 percent) and the balance mostly in starch and flour for food processing and industrial use. Very little is traded in the form of fresh root, given the product’s bulkiness and perishable nature. Thailand is a dominant supplier to world markets, accounting for some 80 percent of global trade; Viet Nam and Indonesia both have a share of about 8 percent; and a few countries in Asia, Africa and Latin America provide  for the remainder.  

Countries in the Far East are the major destination of international trade flows in cassava. Over the past few years, China has emerged as the leading cassava importer, procuring mostly feed ingredients. Presently, the country accounts for around 60 percent of the global market. China has supplanted the EU as the single most important destination for international cassava shipments.

Countries wishing to establish themselves as new exporters of cassava products are likely to face stiff competition from Thailand. Overcoming the competitive advantage that Thailand possesses in exporting cassava products will prove a daunting challenge, particularly in the feed and starch markets.

Cassava_Value Chain Analysis-METHODOLOGY

III.

Field Survey: Mapping the Stakeholders

A set of Questionnaire (Annex 1) was used to map-out the informant to determine what the value chain stakeholders were doing, why they did it and how they come up with their decisions. One-to-one conversations, interviews and group discussions were done based on the guided items in the questionnaire.

However, prior to the above activities, Gov. Antonio H. Cerilles  executed  a letter of urgency (Annex 2) to the municipal mayors for the purpose just stated. The Provincial Agriculturist, Mrs. Marilyn I.S.  Bersales, had then deployed her support staff and extension workers to different municipalities (Annex 3) and to carry out the task.

With the task at hand during the consolidation phase of the data gathered from the survey, Gov. Cerilles commissioned another memo to selective employees from different offices (Annex 4) to do the VCA of the prioritized commodity.

 Mapping the Market 

 3.2.1 Quantitative Mapping of the Value Chain

3.2.1 Qualitative Mapping of the Value Chain

3.2.3  Waterfall Chart

The waterfall chart bridges the quantitative and qualitative output based on the input from questionnaires and FGD, i.e. how the value changes from one segments to another through a series of intermediate chains. For the calculations using Microsoft Office Excel 2007 see Annex 6  

3.3 Commodity Prioritization and Ranking

A Commodity Prioritization Tool was used as a guide in the prioritization of commodity projects here (I-Plan Operation Manual). Initially four commodities based from the survey (cassava, rice, duck, organic vegetables) were subjected to this tool and ranked accordingly. 

Table 6 The major criteria and the weights.

Criteria	Weight
I.     Suitability	20%
II.    Market Potential	30%
III. Impact on the Poor	20%
IV. Number of Beneficiaries / Growers	30%
Total	100%

Scoring for each indicator was on a scale  from 1 to 10, the highest being near 10. However, a perfect score of 10 is not feasible. Hence, the highest score that can be garnered for each indicator was 9. The score measures the perceived value of each indicator vis-à-vis the commodity being evaluated. Therefore, a score of near 10 indicates that the commodity was the best for the given criterion and a score going south or near 0 would indicate the opposite.

Cassava_Value Chain Analysis: Overview

ll

OVERVIEW

Worldwide demand for Cassava by-producer is on and increasing but only Thailand, the leading world producer of cassava starch, is truly undergoing transformation towards industrial uses. In market analysis on cassava by-products, rarely is a distinction made between cassava flour and starch, they come from cassava root starch but go through different phases of production. 

The flour is obtained from drying that have been cut into pieces, roots are washed peeled 1 cut into chips, dried and milled in Brazil, 70 to 80% of cassava production is used exclusively for making flour, while cassava starch is a substance extracted from the tubers which must be process within 48 hours of being harvested. By washing, peeling and grating, the grains of starch are liberated and then processed by soaking, successive sieving, centrifugation, pressing, drying and silting before packaging.

The starch is used in many sectors, including the food industry, pharmaceutical chemistry, foundry, textiles, paper and adhesives. According to the FAO, overall an average to 60 M.T of starch is extracted per year from various cereals, roots and tuber, but only 10% of this starch comes from cassava. Global production of bio-ethanol should in general, reach 155 billion liters in 2020, i.e. 50% more than in 2012. Only about 10% of global cassava production is traded for the last ten years, flour into Asia has greatly accelerated and today Asia represented 90% of world imports.  

Cassava is a sunlight industry and believed to be an emerging catalyst for National and Local Development because of its contribution as food, feeds, ingredients for poultry, feeds tock for the production of bio-ethanol and other industrial uses. The demands for cassava continuous to increase while own local production still lags behind. We need to enhance our local production by adopting a value chain approach and technological advances in order for us to be competitive with other countries.

In the Province of Zamboanga del Sur, the area utilized for Cassava production is increasing by 22% with an estimated production of 12,098.70 MT covering an area of 2,733 hectares (BAS–2012 where 10-15% of cassava production is utilized for food consumption. Most Filipino are eating cassava during breakfast and snacks. (BAS-2009).

Product Level

Cassava is a starchy root crop that develops underground, the tuber grows 2-4 kilograms due to its resistance to drought and diseases can remain in the ground for 2 years.  Cassava is cultivated on small farm size associated with mixed cropping  systems by utilizing/cultivating 1000sq.m per month through progressive farming methods. Thus, in ten months the farmers can develop a one hectare cassava farmland. Cassava production in Zamboanga del Sur is substantially increasing attributed to an increase in area of land cultivated and farmer cooperators.

Cassava provides a reliable source of carbohydrates for home consumption where 10% – 20% for human and animal consumption and 70% to 80% as dried chips for marketing to ZDS Crop Farmers Marketing Cooperatives (ZDSC FAMACO).

Cassava production in Zamboanga del Sur started its operation in 2003 with 5,791 farmer- cooperators which grew to 18,916 in 2011 with an estimated production volume of 3.493 mt (dried cassava chips).

Production System

Production practices may be completely manual, partially mechanized or animal driven especially for land preparation. The majority of the cassava farm in the province ranges from 0.2 to almost a hectare only (Figure 3) per farmer. The prevailing price of cassava is P8.75 per kilogram for cassava dried chips. In areas where farm are relatively large, cassava is intercropped with tree crops or corn and vegetables. Farms may be individually tilled by adopting pit system with organic fertilizer application to increase farm productivity and maintain soil fertility.

Farmers acquire planting materials from the Provincial Government or from their own Cassava plants from the previous cropping. Small holders also rely on the Provincial Government for access to seedlings of high yielding varieties. Good quality planting materials should be at least 8 months old. Freshly harvested stalk when planted exhibit superior quality compared to stored planting materials. The genetic potential of a planting materials result high crop yield and the application of organic fertilizer is economically feasible and climate resilient practice.

Cassava roots can be harvested within 10 months after planting. Harvest cassava preferable during dry season to minimized occurrence of molds/ rotting of tubers. Farmers are practicing manual chipping with knife and sundried or through coconut kiln drier and after being dried, it has a longer shelf life allowing longer distance marketing. 

Global Outlook

The volume of export according to the United Nation Food and Agriculture Organization, the Philippines ranks number 23^rd in cassava production of 2,223,144 M.T. compared to Nigeria rank as number 1  with 54,000.000MT, followed by Indonesia, Brazel, Thailand with an estimated production of 23,922.075 M.T., 23,414.267 M.T., 22,500.700 M.T. respectively and other leading cassava producers in the world.

The Philippine production quantity of 2,223,144 M.T. has a world share of 0.9% compared to Nigeria production quantity of 54,000,000 M.T. has a world share of 20.4%. World Cassava output in 2012 is expected to reach 281,718 M.T., an increase of 7 percent from the level of 2011. The expansion has been prominent in recent years, is being driven by increasing Industrial application and continuing demand for pellets for animal feed in traditional market, whole in Asia, in 2012 Cassava production is set to increase by 11 percent to 93 million tones (FAO-2012 Food Outlook Global Market Analysis ) .

The industrial utilization of Cassava in the form of alcohol and ethanol has been the main driver of the 80 percent expansion in the crops cultivation throughout the region in the past ten years.

National Level

The country with 222,284 hectares planted to cassava, produces 2,222,837.40 M.T. of cassava or a harvest rate of 10mt/ha.  In Autonomous Region in Muslim Mindanao (ARMM) has the highest area planted to cassava with 101,896 or 46% national share, followed by Northern Mindanao with 471,511 hectares or 24% share, Central Visayas with 5% share: Bicol Region with 5% share; Eastern Visayas with 4% share, Western Visayas with 3% share and Zamboanga Peninsula with 1% share while at the regional level, the province of Zamboanga del Sur has the highest production volume of 12,098.70 M.T. and Followed by Zamboanga City of 9294.1 M.T., Zamboanga del Norte – 5,877.73 M.T. and Zamboanga Sibugay - 2,782.75 M.T. The total production volume for the region is 30,053.28 M.T. in 2012.

Cassava: Value Chain Analysis

INTRODUCTION

Cassava (scientific name: Manihot esculenta Crantz) is now considered as one of the important crops in the Philippines because it is one of the four commodities that sustained the growth of Agriculture aside from corn, sugarcane and poultry.   Cassava accelerated its growth to 12.1%  from 2.3 percent in 2012 (NSCB Report, 3^rd quarter of 2013). In 3^rd Quarter 2013 it contributes Php 4.71B (1.95%) in the Gross Value Added (GVA). It has the highest growth rate at 20.8%  in Agriculture Sector (NSCB, 2013).

 This is the main reason why Zamboanga del Sur considered cassava as the 1^st priority commodity to be considered in the Provincial Commodity Investment Plan. Thus, the provincial government has been pushing for the massive production  of high value crops focusing on cassava subsector which is a highly sex-segmented labor opportunities for employment by utilizing women and men in different farming activities in the value chain.

In the value chain of the fresh cassava, the women play an active role in fresh cassava selling for food consumption in the retail market. Wholesale trading is more dominated by men due to the physical aspects of the job like lifting of heavy bags.

In the value chain of the dried cassava, women with the help of children during vacation are typically in-charge of chip production which being done manually while men are engaged in different farming activities.

The cassava livelihood program as promoted by the Provincial Government of Zamboanga del Sur involves planting of cassava inter-cropped with compatible cash crops with the use of locally made organic fertilizer. 

The blueprint of the program is to provide farmers with sustainable livelihood opportunities with family monthly income, i.e. the farmers will  plant cassava in his 1,000m²  area per month for ten months thus a total of one hectare after 10 months of which they can already harvest the first part of the series on the 10^th month; on the 11^th month the second plot will be harvested while refreshing again and replanting the first plot and so on—this protocol is programmed with a social re-engineering design towards a more sustainable Green Revolution that is based on natural farming system.

The potential agricultural areas, the available technology, the demand both locally and in the export market for cassava granules have triggered the development of the cassava value chain analysis. Hence the opportunity of cassava production and processing has a strong domestic market demand and comparative advantage in national and export market.

Several initiatives are implemented to support the development of cassava production by providing technical support especially in the preparation and production of organic fertilizer, financial assistance to farmers, ensuring product quality and marketing services to cassava producers.

To support these initiatives is the partnership forged by the provincial government with San Miguel Corporation (SMC) where farmers delivered their cassava chips directly to the Zamboanga del Sur Farmers Marketing Cooperative (ZDSC FAMCO).  The latter acts as assembler and consolidates volumes from farmers and ensure delivery to San Miguel corporation buying station at Dalapang, Labangan Zamboanga del Sur.

1.1

Rationale

Cassava production is considered as alternative crop to combat against food crisis and energy food that can be grown locally in less favorable and marginal areas to augment local food supply for food items. About 15M Filipinos are eating cassava during breakfast and snacks instead of rice (BAS, 2009).

Aside from food items cassava has several uses, i.e.  ⁽¹⁾one of the ingredients for animal feeds,   ⁽²⁾used to produce liquor and alternative raw materials  to molasses, ⁽³⁾used to make glucose, fructose, lactose, substitute for sucrose in making beverages, jams and canned fruits, ⁽⁴⁾ used to mix with active pharmaceutical materials to make capsules and tablets…⁽⁵⁾ used in yam sizing and material planting for the textile industry, ⁽⁶⁾ can be mixed with biodegradable polymer to produce a packaging material, ⁽⁷⁾ used in Mono Sodium Glutamate,  ⁽⁸⁾ used in making quality glues and can be binders for plywood, and still evolving.

Because of this tremendous uses the demand is significantly very high. It is but timely to design a sustainable approach now. The cassava production or (Gahung/ pit method) is recommended here. It is an expansion of the existing cassava production of the province which primarily aimed to increase local revenues and income of the farmer cooperators.

1.2	Objectives

•         Establish the commodity value chain map and determine/ identify the major players in the value chain for cassava production in Zamboanga del Sur.

•         Determine the opportunities and constraints of the different players along the value chain.

•         Identify the competitive directions to exploit comparative advantages and opportunities and overcome disadvantages and constraints for the benefits of all players along the value chains.

The project will catalyze the social re-engineering aspect in the province to spur economic growth and accelerate development of the cassava industry.  Consequently these approach will enhance peace, food security, public safety by reducing insurgency and delivery of basic livelihood program. These will be intensified in line with the priority intervention needed to strengthen links in the commodity value chain and shall be translated into priority activities needed to be implemented to enhance productivity and competitiveness of cassava production and marketing opportunities. 

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