12fh-5822 - Support program for Development of marketing activities of FFF biofarming clusters
INTRODUCTION For the past several years, the Federation of Free Farmers (FFF) has been promoting the use of alternative technologies that would enable its farmer-members to offset the rising costs of commercial fertilizers and other inputs and at the same time address the declining fertility of their soils. This initiative started with an organic rice production promotion program in 2007 which was then expanded into a biofarming cluster development initiative with the support of Agriterra and the European Union. Under the biofarming program, farmers are organized into clusters for knowledge dissemination and exchange and as centers for the production and supply of bio-organic inputs like compost and organic pesticides. Each cluster is composed of around 20 farmers tilling 20 hectares of land on an average. It is headed by a cluster coordinator selected by the members, a techno-recorder for activity monitoring and documentation, and a technician who provides technical advise to cluster members on a regular basis. Most of the clusters have demonstration farms and have been supplied a variety of equipment and tools, such as chopper-shredders, sprayers, grass cutters, irrigation facilities, and gardening equipment. The clusters also have established their own knowledge centers which serve as their cluster center, library and meeting place. The application of organic inputs and biofarming technologies was intended to help farmers reduce their production costs, increase the quality and value of their products, enhance yields and soil fertility, and improve their overall income. The program was also envisioned to expand the membership and strengthen the FFF and its cooperative arm, the Federation of Free Farmers Cooperatives (FFFC). To date, the Biofarming Cluster Development Program has 33 active clusters involving around 800 farmers in various parts of the country. Many members of these clusters have started to apply bio-organic inputs and related technologies on their individual farms with initially positive results. Production however is not organized on a collective basis, and marketing of farm products is still mostly done individually and to local buyers, with very limited regard as to the product quality, marketability and safety. As a result, the farmers are not able to maximize the value of efforts and secure market premiums for their products. PROGRAM COMPONENTS, STRATEGIES AND OUTPUTS The strategies to be adopted in this program are derived mainly from the approaches developed by the Catholic Relief Services (CRS) and their partners in linking farmers and their clusters to institutional buyers in the Philippines. Similar initiatives have since been undertaken by other NGOs, government agencies and other groups and provide a wealth of experience and lessons that have been adopted in the design of this program. Additionally, the program is not starting from scratch and instead will build on the gains acquired in the FFF’s biofarming cluster development program, particularly in terms of organizing producers, providing them with biofarming technologies, and supplying them with facilities and equipment for knowledge sharing and dissemination and for bio-organic input production. The basic components of the proposed project are: a) Training of FFF Marketing Development Team b) Site Selection and Partnership Building c) Product Supply Assessment and Selection d) Market Chain Studies e) Cluster Reorganization, Planning and Mobilization f) Test Marketing g) Cluster Strengthening h) Documentation, Monitoring and Evaluation i) Project Administration As an initial step, fifteen (15) selected FFF farmer-technicians and staff will be trained either by the CRS or UP Mindanao or a competent resource group on the technology and procedures for developing market linkages for farmers using the clustering approach. They will eventually be deployed as Marketing Development Officers (MDOs) to assist and guide the clusters in their market development programs. Fifteen (15) clusters will be selected from among the current FFF biofarming clusters as target sites for the marketing development program. Each cluster will initially have twenty (20) members on the average. The selected MDOs will be deployed to pinpoint such clusters and undertake an initial evaluation of their production and marketing prospects. Each selected cluster will then undergo a series of interactive workshops and meetings to determine its product supply capabilities and potentials and eventually decide on which products to focus on for the pilot marketing development program for their cluster. This will be complemented by tutorial and on-call advisory services from marketing experts. Market chain studies will then be undertaken as a basis for clusters in developing their marketing strategies. The clusters will develop new organizational structures and guidelines for their production, post-harvest and marketing activities, assign tasks and responsibilities to cluster members, and undertake other mobilization activities. Actual marketing will then be conducted on a pilot basis. The clusters will use their experience from such experimental initiatives to further refine and develop their marketing strategies and plans. In turn, the program will provide supplementary training and technical support for clusters officers and staff to support eventual marketing expansion programs. A monitoring program will be devised to track project developments and their impacts on clusters and their members. The project will be administered from the FFF National FFF Office. The marketing support program will be carried out during a three-year period. PROGRAM IMPACT AND SUSTAINABILITY The marketing support program is expected to improve the incomes of participating farmers, enhance the sustainability of the clusters and the long-term financial and organizational strength and stability of both the FFF and the FFFCI. At the individual cluster member level, the project will increase the incomes of farmers as a result of increased farm output, improved productivity and product quality and improved market value and returns. It is estimated that yields will increase by 15% and overall farm incomes will improve by at least 30% over base levels during the three-year term of the project. In absolute terms, the incremental income is expected to average Php 5,000 per farm family in the first year, and will grow to Php 10,000, Php 12,500 and Php 15,000 in the second, third and fourth years. At the same time, while the initial participants and beneficiaries will be limited to 20 members from each of the 15 target clusters in the first year, the project is expected to involve 100% more farmers by the second year and grow by another 50% in the third year, so that it will benefit 900 individual farmers by the end of the project. At these rates, the additional income benefits generated by the project will approximate the total project cost (exclusive of the Php 5,000,000 working capital fund provided by the FFF/FFFCI). Indirect beneficiaries are estimated at five (5) family members per participating farmer, or 4,500 individuals by the end of the project term. At the cluster level, the enhanced production activities of cluster members and emerging marketing initiatives will provide opportunities for income generation through the provision of marketing and allied services to members. For example, the clusters may assume assemblage, sorting, packing, delivery and related services and negotiations with buyers and collect a percentage of eventual sales of products as its commission. Alternatively, it can charge members fixed fees for the use of facilities and/or services. The clusters can also biofertilizers, biopesticides, seeds, and other inputs to members for a fee. These income streams will enable the clusters to maintain project staff, acquire new equipment and upgrade their services to members. In the longer term, the FFF and its cooperative arm, the FFFC, expect to build up the clusters into a national marketing network supplying larger volumes and a wider variety of products to an expanding market clientele. This could also provide income opportunities for both federations. The FFF can develop a brand name which will be inscribed on all cluster products meeting pre-agreed quality standards, and charge a fee for the use of such a brand name. Like the clusters, it may also collect service fees in exchange for negotiating with buyers for the sale of cluster products. The economic benefits reaped by individual farmers and clusters from the project will serve as major incentives for non-members to join the organization. In turn, the additional income earned by the federation from the marketing activities will enable it to provide more and better services to its members, support its advocacy and lobbying activities, and strengthen it organizationally as a whole. The investments in capacity building for product staff, particularly the marketing development officers, will enable the organization to adequately and effectively respond to emerging needs for support and guidance to new clusters who want to embark on marketing activities.