Sunday, January 31, 2016

Caraga's Signature Product: Search is Over but We Still Have a Long Way to Go

On my way to work each day, I pass by a Jollibee fast food outlet.  This place is decorated with a well- known logo on a tall sign and the whole place is painted in distinctive red, white, grey and yellow color scheme.  It has a three dimensional Jolibee mascot displayed right next to the main entrance and one can often see people taking “selfies” next to this big bee.  People who have eaten at a Jolibee, even one time, can easily recognize a Jolibee outlet anytime they pass by one. They know what menu items, service and prices to expect inside as well.  Jolibee understands the need to have a strong brand identity and what is needed to attract interest and a steady flow of customers.  Jollibee also understands how to maintain a sustainable retail supply chain that is able to keep food that they cook and sell safe for consumers to eat.  Their supply chain management is a well-oiled and efficient enterprise that keeps product flowing in the correct amounts so customers can get what they want when ordering.  Jolibee services also includes an “invisible” cold chain component that keeps food fresh and unspoiled.

As our production and marketing enterprises under the Philippine Cold Chain Project have progressed here in the Caraga Region, we have learned a lot about the production and marketing systems for perishable foods that exist here and the systems that need to be changed.  Caraga or Region XIII has been jokingly called a “pass through” region as it is a place that people “pass through” when going from Cagayan de Oro to Davao or vice versa. One will have to look long and hard to find standardized theme for promotion of the Caraga Region that will entice people to stop and spend time here. 

Unlike Jollibee, branding and promotion of Caraga production and potential is disjointed and uncoordinated.  Individual products with high prospects for brand recognition or fair trade potential such as live groupers or lobsters, mangos, fish, pork, bananas and vegetables are marketed with no thought to promotion or origin.  These perishable products move around and out of the region with little or no thought to promotion of the region’s potential or brand.  While free trade is the backbone to any democracy and demand for locally grown products could be very strong, there are many examples of food products that are or could be economically grown here in Caraga that are instead being shipped in from outside the region.  Many of these supply lines are controlled in a less than democratic fashion.  Most producers remain unorganized, especially in regard to perishable food commodity groups.  Usually producers end up taking lower, less profitable or unprofitable prices for their produce and end up as victims to middle men and inefficient marketing practices. 
Purchasing agents at big outlets like Robinsons prefer to order from 'Bagsakans' (areas for unloading products) in Cagayan de Oro or Davao because product aggregation is an organized and regular activity there and enough volume and variety of produce is available that “one stop shopping” is possible. 

photo lifted @
Meanwhile in the Caraga region, unorganized availability of commodities, multiple layers of marketing channels and price controls by traders leads to a creation of system that is difficult for unorganized producers or retail supply chains to benefit from.  For example, in the Caraga Region there are many producers willing and able to raise quality pigs for local markets.  Quality feeds are available.   We have helped to solve issues involving lack of agriculture credit and have helped to improve genetic materials available. But major pork wholesalers and retailers are reluctant to change or deviate from their established marketing channels that involve trucking live hogs from Davao or frozen halved hog carcasses from Cagayan de Oro because volume, consolidation and integrated supplier operations for hog raisers in the region do not exist. Until a reliable market or markets is available for local production, small farmers who are trying to claw their way out of poverty will remain only with dirty fingernails and nothing in the bank!
We studied the mango production cycle and marketing practices along Butuan Bay from Butuan to Carmen.  We discovered ample mango orchards but also found some systemic problems.  First, absentee ownership of mango plantations leads to abuse of trees from over spraying and underinvestment in lot care, pruning and tree fertilization and irrigation.  Trees that could be very productive and profitable end up becoming overstressed from lack of management and proper care and over spraying for flower induction.  This particular area could benefit from off season production of mangos, taking advantage of higher prices.  However, within the Region there remains to be found any local enterprise group that has the capacity and ability to sort and grade mangos as required by international standards.  There is on group doing hot water treatment to be able to ship mangos overseas from Butuan and no group engaged in production of fresh frozen mango products.  Essentially mangos harvested here in the Caraga region become “Cebu” mangos by default…and the potentials for branding of Caraga mangos and the subsequent increases in marketing capacity and profitability that could come from that remain untapped. 
There is a similar situation for bananas.  At least 50 trucks of bananas are put in hot containers or locally made pallets and shipped from the port of Nasipit to Cebu or Manila weekly.  But all of these bananas are shipped out unsorted and ungraded and unboxed.  As a result, there is product loss during shipment and prices received by growers are at the lowest level…May of these “third class” bananas could be sold at higher prices if they could be sorted, boxed and shipped in better conditions and then sold in markets where higher quality demands a higher price.  While there seems to be a certain satisfaction with selling the lowest priced banana possible, this attitude only serves to reinforce the poverty of the poor producer.  All of these bananas leave the region unbranded so there remains no building of a brand recognition among consumers leading to no knowledge by consumers on where their bananas come from or who they could contact to order more and subsequently help demand and prices to increase.

The PCCP project, with assistance from East West Seed staff has also shown that the Caraga region, especially in the highland areas has huge potential for vegetable production.  Once farmers adapt some simple, low chemical and efficient technology, vegetable production here can be done in large volume and high quality.  However, without a centralized aggregation market place where vegetables can be purchased in volume on a daily basis, the traditional middle man reigns supreme and vegetable growers remain as price takers, rather than price makers!  PCCP is trying to address this through development of a marketing center located near the Nasipit port.  Additional new ways to aggregate and market vegetables whole sale is needed in places like Surigao city and Tandag.

Live lobsters are our commodity of choice to represent the uniqueness of the region and the Caraga brand but there is a long way to go.  Lobster production can be profitable and provide a good income for small farmers.  Demand for live lobsters remains good throughout the year.  However, little has been done to develop connections with big buyers or high end restaurants that would highlight the farm to table connection.  Nothing has been done to assure that each live lobster being shipped out of the region is identified as a Caraga lobster or a Dinagat lobster or a Surigao lobster.  On the other hand, everyone has heard of and at least seen pictures of Maine lobsters…but Caraga lobsters remain as something completely unknown. 

Caraga can do much better for its producers if branding and recognition of quality products produced here improves and becomes better.  But right now, looking for quality food in the region is much like passing by a Jolibee restaurant that has no identifiable markings on the outside the building and is just painted white.  There may be some good food inside but you can’t tell from the outside!  You have to go inside and to discover the good things that are there!