Department of Trade and Industry National Cacao Industry Cluster

• Inclusive Growth: 90 % are small farm holdings, more jobs and Livelihood opportunities, promotes countryside development;

• Poverty Alleviation: Harvest every 2 weeks, suitable for intercropping; income augmentation;

• Market Driven; Domestic and global supply shortfall. No product substitutes for cacao;

• Good for Rehab Program: 18 months gestation period;

• Year Round Production: Harvest every 2 weeks; High Peak: Oct-Dec, Med Peak: May-July, Low Peak: Jan-April; and

• Presence of Support Program from Gov’t. i.e., DENR-NGP, PCA’s Kaanib, DA-HVCC, DOST, DAR , DTI, LBP .

5.0

4.75

4.5

4.25

4.0

3.75

3.5

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

1 Million Ton Shortfall by 2020 M

etr

ic T

on

ne

, M

illio

ns

Year

CAR 0% ILOCOS REGION

1% CAGAYAN VALLEY

1%

CENTRAL LUZON 1%

CALABARZON 0% MIMAROPA

1%

BICOL REGION 1%

WESTERN VISAYAS 1%

CENTRAL VISAYAS

1%

EASTERN VISAYAS

2%

ZAMBOANGA

PENINSULA 2%

NORTHERN

MINDANAO 5%

DAVAO REGION 78%

SOCCSKSARGEN 2%

CARAGA 1%

ARMM 2%

2012 CACAO PRODUCTION

2013-2020 National Cacao

Industry Plan

Cacao Value Chain Map Products

1. Fermented Beans 2. Processed cacao

CACAO PRODUCTION

NURSERY OPERATION

TRADING

EXPORTING

INDUSTRY

ENABLERS

Industry Assn Chamber NGOs PAGRO

LGU/MAO DA BPI DAR PCA

DTI DOST DENR DOLE TESDA

ACADEME GFI/FI

Nursery Operators #

Export

Market

Local traders #

Institutional

Users

Input suppliers # INPUT

SUPPLIERS

Farmers Coops

With Nursery

#

Farmers

Marketing Coops

#

Farmers (non coop)

#

Traders /

Exporters

#

Exporters #

PROCESSING

Processors

#

Whoelsale

/Retail

2020 Cacao Challenge: 100,000 MT

• 2020 Global Consumption : 5.0M MT

• Project Production Shortfall : 1.0M MT

• Areas to be developed : 130,000 - 150,000 hectares

• Annual Projected Expansion : 15,000 - 17,000 Ha/year

Achieve thru: 1. Increase in productivity level 2. Expand production areas or both

Opportunities

- Extensive R&D on varietal improvement - Good germplasm

CACAO PRODUCTION

NURSERY OPERATION

TRADING

CONSOLIDATING

EXPORTING

INPUT SUPPLIERS

PROCESSING

- Large coconut and banana areas for inter cropping; - Availability of gov’t support programs

- Premium price for fermented and certified cacao

- Presence of consolidators/exporters - Entry of new players, encourage competition & pushes prices;

- The domestic market is vastly undersupplied; - Impending global supply shortfall, demand on upward trend;

- Under utilized capacity, presence of support facilities; - Increase demand for cacao processed products, i.e chocolate - Availability of support services;

- Availability of input suppliers

Constraints

- Inadequate supply of good quality seedling materials - Limited access to high yielding scion/clone materials - Proliferation of non-accredited nurseries

- High cost of farm inputs

- Low farm productivity level, Low level of skills on GAP - Inadequate post harvest facilities and basic infras

- Inadequate fermentation facilities - inadequate skills on cacao fermentation/drying

- Low level of consciousness on product quality & standards

- High transport cost

- Beans production still limited - limited value adding activities - Weak linkage between producers and processors

CACAO PRODUCTION

NURSERY OPERATION

TRADING

CONSOLIDATING

EXPORTING

INPUT SUPPLIERS

PROCESSING

To produce 100,000 MT of fermented beans by year 2020 for the export and domestic markets through a 40% annual increase in production through;

Industry Strengthening, Expansion and Promotion Farm Productivity Improvement Easy Access to Quality Seedling Materials Promotion of Value Adding Activities Trade Promotion and Market Development Continual R&D and Product Innovation

P120,000.00 to

P150,000.00

per hectare

Strategy 1. Industry Promotion, Strengthening and Expansion • Organize National and Regional Cacao Industry Councils

• Prepare National and Regional Industry Road Maps

• Facilitate RDC recognition of Regional Cacao Industry Council

• Organize of National Cacao Summit

• Lobby/facilitate membership to ICCO/World Cocoa Foundation

• Conduct Techno and Investment Fora

• Establish industry Databank, i..e. investment Profiles, etc

Strategy 2. Strengthen market linkage and promotion • Quality standards & certification advocacy campaign

• Establishment of Geographic Indication (GI) for Davao Cacao

• Participation to National and International Fair/Exhibits

• Market linkages and referrals (local and foreign)

• Packaging and Labelling Consultancy

• Facilitate cooperative bulk-buying activities

National Programs/Activities/Projects (PAPs)

Strategy 3. Easy Access to Quality Seedling Materials • Strengthen nursery accreditation, strict implementation

• Seedlings dispersal/Distribution

• R&D program on varietal improvement

• Production of quality planting material NSIC-approved cacao varieties

• Establish pro’l/municipal/community-based nurseries and budwood gardens

• Facilitate reforms on nursery accreditation protocol

Strategy 4. Continuous Research and Development • Conduct R&D on Microbial, Physical, and Chemical Analysis and Contaminants • Conduct Technology Demonstrations ( Management of Cacao Pod Borer, and

Coconut-based Farming System, etc)

• Conduct research on bean flavor/aroma

• Conduct R&D on the improvement of cacao processing equipment

• Establish Cacao R&D Centers

• Coordinate R&D Program on Varietal Improvement/ Performance

• Intensify research on Pest and Diseases Control

National Programs/Activities/Projects (PAPs)

Strategy 5. Improve Farm Productivity & Capability Enhancement • Preparation and printing of posters and manual on Cacao GAP

• Training on Cacao Farm Rehabilitation and Good Agricultural Practices

• Training on Cacao Fermentation and drying (post harvest)

• Techno provision through SETUP, MPEX, and CAPE

• Provision of region-wide network of fermentation facility/dryers

• Support to FITS Centers, School on the Air, Farmers’ Field Schools, etc

• Cacao Industry Profiling, Mapping and Geo-Tagging

• Improve farm-to-market roads

Strategy 6. Promotion of more value-adding activities • Conduct of techno transfer training on Cacao processing

• Conduct of institutional development and entrepreneurship seminars

• Establish network with local fabricators re: provision of SSF

• Promote waste utilization to organic fertilizer

• Conduct of skills trainings on Cacao Processing/Value-adding

National Programs/Activities/Projects (PAPs)

• Cost of wet beans/kg : P35-38.00 @ average 250 pieces/kg • Cost of Ready to sow Seeds/kg: P200.00/kg • Cost of Grafting: Labor and Budstick: P3.00 – P4.00 • 1 Fully grown Tree: 250 Budsticks • Nursery: Budwood Garden Rqmt; 1,000 m2 : 2,500 m2 Ratio • Potting medium: Garden Soil, Organic soil, Carbonized Rice Hull • Polyethylene Bag Size: 6”x 10” • Seedlings Production Cycle Time: 6 months (2 cycles per year) • Nursery Infrastructure Cost: P70-100.00/square meter (estimate) • Seedling Density: 35-40 seedlings per square meter • 3 Cubic Meters of Potting Medium = 2,600-2,800 bags • Cost of Grafted Seedlings: P20.00-P25.00 • Production Cost: P12-15.00 /Seedling

• No of Trees/Hectare: Open Area: 1,100, Inter cropped 600 trees • Planting Distance: Minimum 3x3 meters • Target Productivity level: 2 kg/tree/year • Cost per grafted seedling (Davao Price): P20.00-P25.00/seedling • Gestation period: 18 months, 7- 10 pods; 5 Years, 80-100 pods • 7 pods = 1 Kilo Fresh Bean; 20 pods = 1 kilo dried Beans (Pod

Index) • Percent recovery wet to dry: 33%, 1:3 Ratio; • Fermentation Time: 5 days; Drying Time (solar): 5-6 days • Labor for Farm Maintenance: 1:3 • Harvesting Frequency: every 2 weeks • High Peak: Oct-Dec, Med Peak: May-July, Low Peak: Jan-April • Production Cost: P40-45.00/kg dried beans

• Tableya accounts for 4-5% of national consumption; • 3 kg wet beans to 1 kg dried beans: 33% recovery rate • 1.5 kg dried beans to 1 kg Tablea (65-70% conversion

rate) • Cocoa butter is 50% to 57% by weight of cocoa beans; • Average weight of 1 serve Tableya (round): 10 grams • Price (Davao) : 1 kg Tableya Block: P550.00-600.00 (est) • 1 kg pack single Tableya,12 pcs :P100.00 • Production Cost : P250-300.00 per kilo

Thank You!