VCA of Banana Cardava (Mindanao)

PHILIPPINE RURAL
DEVELOPMENT PROJECT
(PRDP)
I-PLAN Component
Mindanao Cluster
VALUE CHAIN ANALYSIS AND

COMPETITIVENESS STRATEGY:
CARDAVA BANANA
Mindanao
DEPARTMENT OF AGRICULTURE
Mindanao Regions
MB/II.- CARDAVA VCA STUDY, DA-PRDP- MINDANAO CLUSTER
October 2014
Pgina 0
CONTENTS
CONTENTS
Page
EXECUTIVE SUMMARY
Section 1: INTRODUCTION
10
A.
Background Information and Objectives
10
B.
VCA Objectives
11
C.
Methodology and Approach
12
Section 2: OVERVIEW OF THE INDUSTRY
13
A.
Production Description
13
B.
Production Trends
15
Section 3: NATURE AND STRUCTURE OF INDUSTRY
28
A.
Value Chain Mapping
28
Key Players and Function
34
C.
Nature of Interfirm Relationship
42
D.
Price and Cost Structure
44
Section 4: MARKETS AND MARKET OPPORTUNITIES
49
A.
Markets and Market Trends
49
B.
Price Trends
54
Section 5: SUPPORT SERVICES
56
A.
Financial Services
56
B.
Non-Financial Services
56
Section 6: ENABLING ENVIRONMENT
58
A.
Formal Rules, Regulations, and Policies
58
B.
Informal Rules and Socio-Cultural Norms
58
Section 7: CONSTRAINTS AND OPPORTUNITIES
60
Section 8: COMPETITIVENESS DIRECTIONS
66
A.
Competitiveness Vision
66
B.
Priority Constraints/Opportunities and Interventions
67
Section 9: CONCLUSIONS AND RECOMMENDATIONS
81
Annex 1, 2, 3, 4, 5, AND 6: PRIORITIZATION OF INTERVENTION STRATEGY PER

REGION
82
LIST OF TABLES
No.
Title
Page
Key Cardava Products Traded in Mindanao
15
World production of Banana, 2009 and 2013
15
Breakdown of Banana Production (In MT) by Genotypes: 2010
16
Cardava Production in the Philippines by Region ranked according to Volume,

2013
18
Top Ten Cardava Producing Provinces in the Philippines, 2013
19
Cardava Production Trends in Zamboanga Peninsula, 2009 to 2013
21
Cardava Production Trends in Northern Mindanao, 2009 to 2013
22
Cardava Production Trends in Davao Region, 2009 to 2013
23
Cardava Production Trends in SOCCSKSARGEN, 2009 to 2013
25
10
Cardava Production Trends in CARAGA, 2009 to 2013
26
11
Cardava Production Trends in ARMM, 2009 to 2013
27
12
Banana Chips Exporters in Mindanao
38
13
First Fry Facilities and Subcontractors in Mindanao
40
14
Indicative Costs and Return for 1 hectare of Cardava Banana
44
15
Relative Financial Position of VC Players: 1 kilo of fresh banana
47
16
Relative Financial Position of VC Players: 1 kilo of banana chips
47
17
Volume and Value of Banana Chips Exports, 2007 to 2011
50
18
Size Classification of Cardava Banana
51
19
Banana Shipments from Mindanao, 2009
53
20
Farm Gate Price of Cardava in Mindanao Regions, 2009 to 2013
55
21
Constraints and Opportunities
60
22
Summary of Constraints/Opportunities and Interventions
79
LIST OF FIGURES
No.
Title
Page
USES AND BY-PRODUCTS OF CARDAVA BANANA
13
BANANA GENOTYPES AND CONSUMPTION GROUPS
17
PERCENTAGE BREAKDOWN OF BANANA PRODUCTION IN THE PHILIPPINES

BY GENOTYPE, 2013
18
BREAKDOWN OF BANANA PRODUCTION IN THE PHILIPPINES BY ISLAND

GROUP, 2013
20
PERCENTAGE BREAKDOWN OF BANANA PRODUCTION IN MINDANAO

REGIONS BY GENOTYPE, 2013
20
VALUE CHAIN MAP FOR FRESH CARDAVA FOR RETAIL MARKETS
28
FLOW OF CARDAVA FROM MINDANAO TO KEY URBAN CENTERS
29
TYPICAL MODE OF DELIVERY TO BUYING STATIONS IN MINDANAO
29
VALUE CHAIN MAP FOR PROCESSED BANANA
30
10
COLLECTION OF CARDAVA FROM BUYING STATION IN MAGUINDANAO FOR

DELIVERY TO DAVAO BANANA CHIPS EXPORTER
31
11
FLOW OF CARDAVA TO PROCESSOR-EXPORTERS
31
12
VALUE CHAIN MAP FOR CARDAVA SNACK FOOD
32
13
BANANA CUE VENDOR BUYING CARDAVA FROM A PROCESSING PLANT
33
14
GEOGRAPHIC FLOW OF CARDAVA
33
15
PHILGAP CERTIFIED CARDAVA FARM IN DAVAO DEL SUR
35
16
EXAMPLE OF A WELL-MAINTAINED CARDAVA FARM IN DAVAO DEL SUR
36
17
TYPICAL BUYING STATIONS IN MINDANAO
37
18
CARDAVA REJECTS AT BUYING STATION
37
19
KEY PROCESSES IN BANANA CHIPS PRODUCTION
39
20
CARDAVA SNACK FOOD INDUSTRY
41
21
RELATIVE FINANCIAL POSITION OF VC PLAYERS: FRESH CARDAVA TO

MANILA MARKET
46
22
RELATIVE FINANCIAL POSITION OF VC PLAYERS: BANANA CHIPS FOR

EXPORT MARKET
48
23
AVERAGE PERCENTAGE SHARE TO EXPORT SALES BY KEY DESTINATION

COUNTRIES, 2007 TO 2011
49
24
COMMON QUALITY PROBLEMS ENCOUNTERED BY

PROCESSORS/CONSOLIDATORS
52
25
AVERAGE FARM GATE PRICE OF CARDAVA IN MINDANAO REGIONS, 2009

TO 2013
54
26
SYNTHESIS OF COMPETITIVENESS VISION 2014-2020
66
ACRONYMS
ACEF
ACPC
ACCESS
AFMP
AMCFP
ASEAN
ARC
ARMM
BAFPS
BACs
BAS
BAPC
BFAD
BSWM
BPI
DA
DA-BAR
DENR
DOH
DOST
DTI
FAO
FEP
FGD
GAP
GBEs
GATT
GMP
ha
IQF
KII
LBP
LGU
MFIs
MFI
MLGU
MRDP
MT
NCCAP
PCIP
Agricultural Competitiveness Enhancement Fund

Agricultural Credit Policy Council
Accelerating Change in the Countryside thru Equity Sharing Strategy
Agri-Fishery Microfinance Program
Agro-Industry Modernization Credit Finance Program
Association of Southeast Asian Nations
Agrarian Reform Communities
Autonomous Region in Muslim Mindanao
Bureau of Agricultural and Fisheries Product Standards
Bank-Accredited Cooperatives
Bureau of Agricultural Statistics
Bukidnon Agricultural Productivity Center
Bureau of Food and Drugs
Bureau of Soils and Water Management
Bureau of Plant and Industry
Department of Agriculture
Department of Agriculture Bureau of Agriculture Research
Department of Environment and Natural Resources
Department of Health
Department of Science and Technology
Department of Trade and Industry
Food and Agriculture Organization
Farmer Entrepreneurship Program
Focus Group Discussion
Good Agricultural Practices (Global GAP)
Grading and Bailing Establishments
General Agreement on Tariffs and Trade
Good Manufacturing Practices
Hectare(s)
Individually Quick Frozen
Key Informant Interview
Land Bank of the Philippines
Local Government Unit
Micro Financing Institutions
Most Favoured Nation
Municipal Local Government Units
Mindanao Rural Development Program
Metric Tons
National Climate Change Action Plan
Provincial Commodity Investment Plan
PDP
PLGUs
PRDP
PSA
RCEP
SAS
SOCCSKSARGEN
SUCs
VCA
WII
Philippine Development Plan

Provincial Local Government Units
Philippine Rural Development Project
Philippine Statistics Authority
Regional Comprehensive Economic Partnership
Sustainable Agriculture Standard
South Cotabato, Cotabato, Sultan Kudarat, Sarangani and General
Santos City
State Universities and Colleges
Value Chain Analysis
Weather-based index
EXECUTIVE SUMMARY
This report provides an overview and analysis of the Cardava industry in Mindanao with the aim of
identifying main leverage points and key strategies to improve competitiveness and promote
development in a pro-poor and sustainable manner. It will provide the basis for the formulation of
the Provincial Commodity Invest e t Pla a d ill la the fou datio fo PDP s oope atio
ith
the private sector and other government agencies active in the Cardava industry.
Bananas are generally classified into two main categories: cooking bananas and dessert bananas.
Cooking bananas are categorically known as balbisiana cultivars. There are numerous cooking
banana cultivars such as the Cardava, Abutan, Inabaniko, Turangkog, Sabang puti, Mundo, Gubao,
Saba sa Hapon and Bigihan. However, the most common cultivar in the Philippines with both social
and economic importance is the Cardava or Saba.
Same as with the dessert banana, Cardava is rich in carbohydrates. It is, however, less valued as a
fresh product even when mature, as it still contains starch at this stage. The Cardava is consumed
necessarily cooked, whether green or ripe. In some cases, Cardava is consumed as an alternative
staple food in lieu of rice.
The Cardava can be processed into various product forms such as chips, sauce, flour, and made into
snacks. To date, the most dominant users of Cardava are the banana chips industry, snack food
subsector, and home consumption for the preparation of various traditional Filipino desserts and
dishes su h as the po he o .
The banana chips industry requires the processed grade Cardava while those intended for home
consumption would generally be medium to jumbo sizes. Small ripe bananas go to the snack food
market. In a way, the varying requirements of these three dominant users provide markets for
different qualities and sizes of banana.
The Philippines is the only producer of Cardava banana. Other countries such as Thailand, Indonesia,
Ecuador, and African nations have their own local cooking banana varieties. There are ambiguities
with regards to production statistics on the cooking bananas. The FAO statistics distinguish between
a a a a d pla tai
ut it is ot lea hat these t o te s o e . The ost i di ati e statisti s
on cooking bananas is from Lescot (2010) of Fruitrop/CIRAD Market News Service. Based on the
2010 statistics, cooking bananas which included plantains (under CIRAD categorization) comprised
41% of total world banana production. The Philippine Cardava or Saba variety accounted for about
6% of the estimated 47,208,190 MT cooking banana world production in 2010.
In the Philippines, Cardava is grown nationwide. According to the Bureau of Agricultural Statistics
(BAS)/Philippine Statistics Authority (PSA), the country produced 2,556,986.07 MT of Cardava,
cultivated in 183,479.01 hectares. The top three Cardava producing regions in the Philippines in
2013 were Davao Region, SOCCSKSARGEN, and Northern Mindanao.
National average yield in 2013 was 13.94 MT per hectare. The top 3 high yielding regions in
Philippines are SOCCSKSARGEN (36.77 MT/ha), Davao Region (24.21 MT/ha), and Northern
Mindanao (22.61 MT/ha).
Except for Caraga and ARMM, regions in Mindanao had higher
productivity than the rest of the Philippines. It is possible for farm yields to be from 50 to 80
kilos/bunch with the combination of improved pest control management, use of clean planting
materials (tissue, cultured) and appropriate fertilizer application.
Mindanao regions accounted for 60% of the national Cardava production. The top 2 cardava
producing provinces in Mindanao and in the Philippines in 2013 were North Cotabato with
272,733.03 MT and Davao del Sur 271,165.41 MT. Cardava comprised about 21.7% of Mindanao s
overall banana production. Total production in Mindanao in 2013 decreased by 7% over 2012
performance. Among Mindanao regions, Davao had the highest percentage of decrease in
production with an average of 3.09% per year, mainly due to typhoon Pablo devastation and
Pa a a u tok disease, ith Co postela Valle as the ost affe ted a ea ith a d a ati
decrease of 52% in its production volume from 152,903.96Mt in 2012 to 74,201.17MT in 2013. On
the other hand, SOCCSKSARGEN registered a steady average growth of 2.28% annually.
In Zamboanga Peninsula and Caraga, Cardava comprised a higher percentage of the banana
production while in ARMM, quantity of Cavendish and Cardava production in 2013 was almost of the
same level. Davao Region, Northern Mindanao, and SOCCSKSARGEN produced more Cavendish
than Cardava in 2013. It would seem that areas with significant number of Cavendish banana
plantations had higher yields than areas that were predominantly producing Cardava.
There are basically two types of Cardava production system in Mindanao. The first one is the
backyard production, which is the more prevalent system in Mindanao. Under this system, Cardava
banana is grown in backyards of rural households and in small farms. Size of farms under this
system ranges from 0.25 to 1 hectare. The second system employed by farmers is the intercropping
or mix crop production. In this system, Cardava banana can be a primary or secondary crop or
planted together with dessert bananas. Farms classified under this system range from 1 to 3
hectares.
Traders perform the important tasks of negotiating, collecting, sorting, and transporting. Traders
also act as financiers in the chain. There are the different types of traders depending on their scope
of operations: Agents/Local Traders/Buying Stations; Assemblers/Consolidators; Consignee;
Jobbers/Wholesalers:
Although there is an increasing number of medium and high end restaurants serving Cardava based
snacks by giving it a twist (e.g., serving with ice cream, mixing relatively expensive ingredients), the
biggest segment engaged in the preparation and retail sales of maruya, turon, and banana cue are
the microprocessors and the street food vendors. The street food vendors are important market
channels particularly for matured bananas (undersize/over size). A vendor purchases from 300 to
1,000 kilos per month depending on location. Vendors source their bananas from farmers, traders,
and the wet markets.
Nationwide, there are about thirty-five banana chips exporters. Twenty-five companies are located
in Mindanao and, of which, twenty-one (21) have their factories in Davao Region (DTI RODG Study).
About 60% of the 25 exporters have production capacity of more than 50 tons per day. Processors,
especially the big companies, indicated that they are only able to utilize 60% to 80% of their capacity
due to difficulties in sourcing Cardava. Some exporters also tried supporting first fry facilities but
only a few have been successful. For a first frying facility to be viable, it should have a wide base of
suppliers of Cardava and a production capacity of at least 4 tons daily. Exporters are generally
willing to provide some assistance (e.g., supply of coco oil, technical assistance), but only after the
facility has proven its reliability and trustworthiness.
More farmers especially in Davao Region and SOCCSKSARGEN are taking on more functions in the
chain such as collective marketing and training services. The more established cooperatives have
ventured into first frying operations. Agrarian reform communities are generally into the production
of banana chips for the local market. Cooperatives linked to lead firms (e.g., processors, assemblers)
appear to be more successful in scaling up their operations than those who are trying to penetrate
on their own the banana chips retail market
Marketing relationships between traders and farmers are informal and characterized by the concept
of the suki s ste o pe so alized e o o i elatio s. The suki s ste , hi h is si ila to the
preferred supplier-buyer relations, proliferated in efforts to find ways to minimize risks and
vulnerabilities to opportunistic behaviour and cheating (both trader and farmer). Players see the
a ket as ho oge ous a d i te s of the e t a to i the hai the person who bought their
produce. Traders, on the other hand, are often reluctant to share information on where products are
sold. Compliance with product and process standards is weak. To date, there is now openness
among processors to develop longer-term and more collaborative relationships with farmers. The
big processors are incrementally integrating backwards into farming communities especially those
who can offer them specific advantages such as big volume, organic/natural farming, and consistent
quality.
Main Cardava-based product that is currently exported is the banana chips. There are three main
market segments for banana chips, namely: a) the food processing market; b) the retail market; and
c) the catering market. The food processing market is by far the largest segment for the banana
chips, thus putting pressure on prices. During the recent years, Vietnam has become a
transshipment point for banana-chip exports to China. Vietnam benefits from the trade as it enjoys
advantageous tariff rates due to bilateral pacts with China. Some Chinese buyers prefer to buy first
fry chips and have these processed further in Vietnam. The big European import companies order an
average of 25 40 footer containers of banana chips per year per company while medium and small
importers order in average 10 40 footer containers per year per company. They shift between
Thailand and Philippine suppliers.
Although the Philippines has remained the leading exporter of banana chips, competition is also
intensifying from countries like Vietnam, Thailand, and Malaysia in key export markets. Markets are
increasingly concerned with the specifications of both products and processes further back along the
value chain in a number of different ways: a) quality and safety - based upon product and process
controls: b) conformance with social and environmental standards; c) traceability and authenticity;
d) reliability and guaranteed supply in order to avoid stock outs; e) just-in-time delivery; and f)
product differentiation and innovation as a means of adding value and margins.
About 62% of total available supply or an average of 600,000 to 800,000 MT are sold in the domestic
market. Mindanao banana (all types) production for the domestic market goes to Cebu and MetroManila largely through ports in Cagayan de Oro, Agusan, Ozamis, Iligan, and Surigao. Based on 2009
data, about 73% of the banana shipped out of Mindanao seaports originated from the port in
Cagayan de Oro.
To sustain and grow the world market for Cardava, the i dust s isio of eati g lo g-term
competitiveness and sustainability centers on the establishment of an efficient and integrated
supply chain management geared towards the achievement of the following:
a) Adequate supply and widespread use of tissue cultured planting materials to minimize risks
of pest and disease infestation and, consequently, ensure stable supply of Cardava
b)
Improved access to, availability, use, and utilization of organic fertilizer and other inputs
appropriate for Cardava banana farming while reducing environmental costs
c) Enhanced flow and quality of extension services for Cardava farming to facilitate adoption
of GAP for improved productivity and product quality
d) Improved access to GMP compliant postharvest and distribution technologies and facilities
to reduce postharvest losses and maintain product quality
e) Availability and access to improved processing technologies, product development services,
and GMP and Halal compliant common service facilities to facilitate the production of
commercially viable Cardava-based products
f)
Improved physical/infrastructure linkages to input, support, and product markets
Section :
INTRODUCTION
A. BACKGROUND INFORMATION AND OBJECTIVES1
The agricultural sector strategy (Agri-Pinoy) embodied in the Philippine Development Plan (PDP) for
2011-2016 advances the principles of inclusive growth, food staple sufficiency, natural resource
management and area-based development. Agri-Pinoy also includes the following new strategies: (i)
institutionalizing regionally-based, spatial planning (ii) developing a systems approach for both
planning and resource allocation; (iii) providing the critical infrastructure needed by priority value
chains; and (iv) building a more resilient production base to accommodate fluctuations in global
markets and effects of climate change. Complementing the Agri-Pinoy strategy is the National
Climate Change Action Plan (NCCAP) which highlights the priority to be given to the rural sector in
pursuing climate adaptation measures.
The Philippine Rural Development Program (PRDP), a flagship program of the Department of
Agriculture (DA), is aligned with the Agri-Pinoy strategy. It is a six-year program (2013-2019)
desig ed to esta lish the go e
e t s platfo fo a ode , li ate-smart and market-oriented
agri-fishery sector. Externally, it will focus on expanding market access and improving
competitiveness. Internally, it will introduce reforms in operating the DA bureaucracy. Specifically,
it aims to achieve the following development objectives:
At least, 5% increase in annual real household incomes of farmer beneficiaries; 30%

increase in income for targeted beneficiaries of enterprise development
7% increase in value of annual marketed output
20% increase in number of farmers & fishers with improved access to DA services
To facilitate the achievement of above objectives, the program has four main components, namely:
I-PLAN: Investment for AFMP Planning at the Local and National levels
I-BUILD: Intensified Building-Up of Infrastructure and Logistics for Development
I-REAP: Investments for Rural Enterprises and Agricultural and Fisheries Productivity
I-SUPPORT: Implementation Support to PRDP
The design of PRDP and its implementation aspects draw heavily on the experiences of the
Mindanao Rural Development Projects (MRDP 1 and 2), a program that has been successfully
implemented over the past decade. The program adopts a value chain development approach as a
platform for promoting inclusive, climate resilient, and sustainable growth in key agricultural
subsectors and value chains.
The Cardava banana is one of the selected priority products on which the PRDP will concentrate
during Year 1 of PRDP implementation. Cardava accounts for 41% of the land area planted to banana
in the Philippines. Export industry is concentrated in Mindanao with Cardava as one of the most
important raw materials. The Cardava is among the three cultivars included in the Banana Industry
Cluster, which is among the top priority clusters being promoted and supported by the government
under the National Convergence Initiative (NCI).
Overview of PRDP was taken from the Program Information Document World Bank website
10
The Cardava is economically and socially important for many sectors in Mindanao for the following
key reasons:
a) For the thousands of Cardava banana farmers, a Cardava plant is the equivalent of having
money grown on trees. Banana is fast-growing fruit crop that starts fruiting in 8 to 12
months from field-planting. With minimal expenditures on inputs or other care, a household
can harvest a small number of bananas on a weekly basis, bring them to a market for sale
and use the proceeds to buy food, i.e. the very definition of food security.
b) Cardava is the ai a
ate ial fo
To date, demand exceeds supply.
a a a hips hi h is a o g the ou t
s top exports.
c) Thousands of street food vendors derive a significant portion of their income from selling
Cardava-based snack food.
d) It is one of the important sources of food in the rural areas. Cardava banana is often used to
extend, supplement or substitute staple food such as rice and corn. Banana may be the new
potatoes in the future. A research carried out by CGIAR agricultural partnership says that
bananas may replace potatoes in some developing nations as a result of climate change. An
enterprise in Davao has started the promotion of banana fries both in the local and export
market.
e) Almost every part of the Cardava banana can be economically utilized. The inflorescence is
consumed as vegetable. The peels can be made into patties and can be a good substitute for
meat. The leaves are used as wrapping and decorative materials. The pseudo stem is
chopped finely, cooked and used as feed for livestock. Waste materials can be composted
and processed into organic fertilizer.
f)
It can be grown in marginal areas and has low input requirements.
B. OBJECTIVES OF THE VCA

The decision to shift to a Mindanao cluster level value chain analysis was borne out of the need for
the six regions to jointly exploit the trade potentials of Cardava banana in the domestic and export
markets. The cluster approach also recognizes that the 6 regions in Mindanao are interdependently
linked with each other in various functions in the chains particularly with regards to inputs markets
and distribution or marketing of Cardava. The cluster level approach to value chain analysis also
hopes to bring cohesiveness into the various Cardava development initiatives that would be
undertaken on a provincial basis.
This report provides an overview and analysis of the Cardava banana value chain with the aim of
ide tif i g ai le e age poi ts a d ke st ategies to i p o e Mi da ao s o petiti e ess a d
promote development in a pro-poor and sustainable manner. It will provide the basis for the
formulation of the Provincial Commodit I est e t Pla a d ill la the fou datio fo PDP s
cooperation with the private sector and other government agencies active in the Cardava industry.
Specifically, the value chain analysis aims to:
a) Provide an in-depth understanding of the range of factors and relationships that affect the
performance of the Cardava industry in Mindanao, including end markets, enabling environment
and coordination/cooperation among firms.
11
b) Identify in a participatory process the systemic chain level issues that hinder or promote the
gainful participation of rural households, sustainability of the chain, and its competitiveness in
general.
c) Under a participatory process, identify and prioritize interventions needed to overcome
bottlenecks throughout the chain that would foster value chain competitiveness and climate
change resiliency.
d) Identify and explore how to catalyze private and public sector stakeholders in the Cardava
industry to collaborate for improved industry performance
C. METHODOLOGY AND APPROACH

An initial desk study was conducted to collect and summarize information from currently available
reports and studies. It provided guidance to issues that needed to be the focus of field research. The
field work component of the study was conducted using qualitative research techniques particularly
value chain analysis workshops, key informant interviews (KII), and focus group discussions (FGDs).
Key informants and participants to the workshops and FGDs consisted of farmers, traders,
processors, exporters, and representatives from relevant government agencies. Key informant
i te ie s e e used fo olle ti g data o i di iduals pe spe ti es, e pe ie es, a d ua titati e
data. FGDs were effective in generating broad overviews of issues of concerns to the groups or
subgroups represented and in the triangulation/vetting of information obtained from the KII.
Constraints and interventions were identified and further elaborated based on iterative and
inductive analysis of responses during the KII and FGD/Stakeholders Workshop primarily from the
following perspectives:
Context of key informants and FGD participants
Third party observations (e.g., government agencies, providers, VC facilitators with

experience in Cardava VC development projects, etc.) were important for suggesting
important issues to explore and for substantiating the results of the company interviews
Past assessment studies of the Philippine Cardava banana industry
Competitiveness is generally defined as the ability to efficiently produce goods (and services) for
which there is high demand that leads to increased income generation capacities that are
sustainable in the future. Strategy is about choice --- choosing what to do to build competitiveness
from a long list of viable and promising options. Given the competing and varied incentives and
motivations among and between stakeholders and players, the process required iterative ranking
and prioritization and arriving a consensus on what needs to be done within the next 5 years. The
competitiveness strategies proposed in this report reflect the choices made as a result of extensive
a al sis of the i dust s ke o st ai ts a d a dialogue ith stakeholde s a d pla e s.
12
Section :
OVERVIEW OF THE INDUSTRY
A. PRODUCT DESCRIPTION
Bananas are generally classified into two main categories: cooking bananas and dessert bananas.
Cooking bananas are categorically known as balbisiana cultivars. There are numerous cooking
banana cultivars such as the Cardava, Abutan, Inabaniko, Turangkog, Sabang puti, Mundo, Gubao,
Saba sa Hapon and Bigihan. However, the most common cultivar in the Philippines with both social
and economic importance is the Cardava or Saba.
Unlike the Cavendish which is cultivated primarily by large plantations, Cardava is grown in
backyards of rural households and in small farms. It can be cultivated in nearly all kinds of soil but
deep and friable loam soil with good drainage and aeration offers higher production and better fruit
quality. Areas with uniform warm and humid conditions with a minimum rainfall of 60 inches
annually, whether through heavy and evenly spaced rainfall and a temperature between 27 and 30
degrees centigrade offers the most favorable condition for growing Cardava banana.
Cardava bunches are big with 8 to 16 hands having 12 to 20 fingers per hand. The fruits are short
and stubby and highly angular. The skin is thick and yellow when ripe. The flesh is white, starchy, and
fine textured, making it ideal for cooking and processing.
13
Same as with the dessert banana, Cardava is rich in carbohydrates. It is, however, less valued as a
fresh product even when mature, as it still contains starch at this stage. The Cardava is consumed
necessarily cooked, whether green or ripe. In some cases, Cardava is consumed as an alternative
staple food in lieu of rice.
The Cardava can be processed into various product forms such as chips, sauce, flour, and made into
snacks. To date, the most dominant users of Cardava are the banana chips industry, snack food
subsector, and home consumption for the preparation of various traditional Filipino desserts and
dishes su h as the po he o .
Banana chips are thin slices of banana which are deep-fried to become crispy. Chip products may be
sweetened, honey-dipped, unsweetened, cinnamon- or chocolate-flavored and salted. Chips are
available in various cuts such as whole, halves, quarters, diagonals, diced and broken cuts. These
are consumed as a snack or used as ingredient for breakfast cereals, muesli, mixed fruits, and
chocolates. Products are mainly geared for the export market.
The most popular snacks made of Cardava a e the a a a ue
hole f ied a a as dipped i
brown sugar a d sold i a oo ske e s a d tu o
f ied a a a sp i g olls . A othe popula
Cardava-based snack is the
a u a o a a a f itte s. These a e usuall o su ed as idafternoon snacks. The snack foods are sold via street vendors, school canteens, and restaurants.
During the recent years, a Davao-based manufacturer has started exporting frozen turon and boiled
banana to countries with significant Filipino and Asian population. A banana chips company in
Davao has also expanded into individually quick frozen (IQF) snack products.
The banana chips industry requires the processed grade Cardava while those intended for home
consumption would generally be medium to jumbo sizes. Small ripe bananas go to the snack food
market. In a way, the varying requirements of these three dominant users provide markets for
different qualities and sizes of banana.
Other by-products of the Cardava banana are the catsup, vinegar, and flour. In Lanao del Norte, one
agrarian reform cooperative is engaged in the manufacture of catsup. Production though is still low
and market is currently limited within the locality and neighboring provinces (via trade fairs).
The puso o the da k ed i flo es e e of the a a a is also edi le. Aside f o ooki g the puso
into the t aditio al gi ataa o kila i , it can also be made into vegetarian patties.
Banana peels are traditionally used as feeds or converted into organic fertilizer. Another alternative
use of banana peels is as meat substitute and extenders. It can also be utilized as a material for
making paper and paper boards. The leaves are used as packing materials in markets and traditional
wrappings of native dishes.
While Davao Region is the main producer of banana chips, Northern Mindanao is the largest supplier
of fresh Cardava for the retail markets and local Cardava based snack food in key urban areas in the
Philippines. Although SOCCSKSARGEN has companies engaged in banana chips, a greater
percentage of its production is sold fresh either to banana chips exporters or to traders dealing with
the fresh retail market. Caraga also produces banana chips with a significant percentage geared for
the export market. Maguindanao in ARMM is a key supplier of fresh banana for banana chips
companies in Davao. Production in other provinces of ARMM is sold fresh in the local market. All of
the regions in Mindanao have thriving Cardava-based snack food businesses consisting mainly of
street vendors --- from ambulant vendors selling boiled bananas in bus stations to turon and maruya
stalls near schools, parks, and malls.
14
Table 1. Key Cardava Products Traded in Mindanao

Region
Fresh Banana for

Retail Market
Banana Chips
Snack Food
(Local Market)
IQF Cardava
Snacks
(for Export)
Zamboanga Peninsula
Northern Mindanao
subcontractor
Davao Region
SOCCSKSARGEN
Caraga
ARMM
Legend
Dominant
Secondary
Source: KII/FGD
Other by-products of the Cardava banana are the catsup, vinegar, and flour. In Lanao del Norte, one
agrarian reform cooperative is engaged in the manufacture of catsup. Production though is still low
and market is currently limited within the locality and neighboring provinces (via trade fairs).
The puso o the dark red inflorescence of the ba a a is also edi le. Aside f o ooki g the puso
i to the t aditio al gi ataa o kila i , it can also be made into vegetarian patties.
Banana peels are traditionally used as feeds or converted into organic fertilizer. Another alternative
use of banana peels is as meat substitute and extenders. It can also be utilized as a material for
making paper and paper boards. The leaves are used as packing materials in markets and traditional
wrappings of native dishes.
B. PRODUCTION TRENDS
1. Global Production
Bananas (Musa spp.), including dessert banana, plantain, and cooking banana, are the eighth most
important food crop in the world, and the fourth most important in the least developed countries
(FAOSTAT, 2013). Bananas are produced in 135 countries and territories across the tropics and
subtropics. The vast majority of producers are smallholder farmers who grow the crop for either
home consumption or for local markets (less than 15% of the global production of more than 100
million MT is exported). The international banana export trade (17 million MT approximately) is
worth some US$ 7 billion per year.
15
Table 2. World production of Banana, 2009 and 2012

Country
Volume (MT)
2009
% Share
World
100,223,702
100%
India
26,469,500
Philippines
Country
Volume (MT)
2012
% Share
World
101,992,743
100%
26.41%
India
24,869,490
24.38%
9,013,186
8.99%
China
10,845,265
10.63%
China
9,006,454
8.99%
Philippines
9,225,998
9.05%
Ecuador
7,637,324
7.62%
Ecuador
7,012,244
6.88%
Brazil
6,783,482
6.77%
Brazil
6,902,184
6.77%
Indonesia
6,373,533
6.36%
Indonesia
6,189,052
6.07%
Tanzania
3,006,400
3.00%
Angola
2,991,454
2.93%
Guatemala
2,544,240
2.54%
Guatemala
2,700,000
2.65%
Mexico
2,232,361
2.23%
Tanzania
2,524,740
2.48%
Colombia
1,993,759
1.99%
Mexico
2,203,861
2.16%
Others
25,163,463
25.11%
Others
26,528,455
26.01%
Source: FAOSTAT (updated)
World banana production increased from 100,223,702 MT in 2009 to 101,992,743 MT in 2012. With
the sig ifi a t i ease i Chi a s p odu tio , Philippines dropped from being the 2nd largest
producer in 2009 to 3rd place in 2012. India remains the top producer of banana in the world.
Philippines accounted for about 9.05% of the global banana production in 2012. Philippine
production increased from 9,013,186 MT in 2009 to 9,225,998 MT in 2012.
Table 3. Breakdown of Banana Production (In MT) by Genotypes: 2010

Region
(World)
Cooking Banana
Dessert Banana
Total
Plantain
(AAB)
Highland
Bananas +
ABB + others
Cavendish
Gros Michel
+others
N. America
4,000
7,890
100
11,990
S. America
5,314,743
513,913
12,235,024
3,710,437
21,774,117
C. America
972,800
106,876
6,523,545
100,000
7,703,221
Caribbean
956,216
508,246
931,491
239,242
2,635,195
W.C. Africa
8,198,008
912,396
2,337,310
491,242
11,938,956
E. Africa
1,137,036
14,670,783
2,467,884
680,703
18,956,406
31
9,667
1,913,543
9,316
1,932,557
1,299,184
12,058,539
29,486,825
7,260,348
50,104,896
Oceania
1,431
543,210
304,423
69,924
918,988
Europe
101
1,010
435,236
1,020
437,367
17,879,550
29,328,640
56,643,171
12,562,332
116,413,693
N. Africa ME
Asia
Total
Percentage
41%
59%
100%
Source: Lescot 2010

16
The Philippines is the only producer of Cardava banana. Other countries such as Thailand, Indonesia,
Ecuador, and African nations have their own local cooking banana varieties. There are ambiguities
with regards to production statistics on the cooking bananas. The FAO statistics distinguish between
a a a a d pla tai
ut it is ot lea hat these t o te s o e . The ost i di ati e statisti s
on cooking bananas is from Lescot (2010) of Fruitrop/CIRAD Market News Service. Based on the
2010 statistics, cooking bananas which included plantains (under CIRAD categorization) comprised
41% of total world banana production. The Philippine Cardava or Saba variety accounted for about
6% of the estimated 47,208,190 MT cooking banana world production in 2010.
2. Domestic Production
Based on BAS data, the country produced 8,645,748.66 MT of cardava in 2013 in 445,934.67
hectares of land, with Cardava accounting for about 29% of national banana production, Cavendish
(49%) and Lakatan (11%). Latundan and other cultivars accounted for about 11%.
17
Cardava is cultivated in 183,479.01 hectares in 2013. Collectively, Mindanao accounted for 41% of
the area planted to Cardava. Total national production was reported at 2,556,986.07 MT. The top
three Cardava producing regions in the Philippines in 2013 were Davao Region, SOCCSKSARGEN, and
Northern Mindanao.
Table 4 . Cardava Production in the Philippines by Region ranked according to Volume, 2013
Region
Volume (MT)
Area (Ha)
Yield (MT/ha)
% Share to
RP Volume
Philippines
2,556,986.07
183,479.01
13.94
100%
Davao Region
487,433.13
20,136.00
24.21
19.1%
SOCCSKSARGEN
356,727.43
9,702.00
36.77
14.0%
Northern Mindanao
295,655.65
13,076.00
22.61
11.6%
Cagayan Valley
255,377.19
15,792.00
16.17
10.0%
Western Visayas
203,869.72
18,929.00
10.77
8.0%
Eastern Visayas
169,426.82
14,646.80
11.57
6.6%
ARMM
145,612.72
15,173.50
9.60
5.7%
Zamboanga Peninsula
138,878.30
8,540.00
16.26
5.4%
Central Visayas
123,176.13
12,941.00
9.52
4.8%
Caraga
101,025.42
8,671.43
11.65
4.0%
Mimaropa
98,915.44
11,848.71
8.35
3.9%
Calabarzon
77,558.71
17,582.33
4.41
3.0%
Bicol Region
43,196.36
9,514.00
4.54
1.7%
Central Luzon
29,128.29
2,429.00
11.99
1.1%
Ilocos Region
21,451.93
3,144.23
6.82
0.8%
CAR
9,552.81
1,353.00
7.06
0.4%
Source: BAS/PSA
18
National average yield in 2013 was 13.94 MT per hectare. The top 3 high yielding regions in
Philippines are SOCCSKSARGEN (36.77 MT/ha), Davao Region (24.21 MT/ha), and Northern
Mindanao (22.61 MT/ha).
Except for Caraga and ARMM, regions in Mindanao had higher
productivity than the rest of the Philippines. It is possible for farm yields to be from 50 to 80
kilos/bunch with the combination of improved pest control management, use of clean planting
materials (tissue-cultured) and appropriate fertilizer application.
Table 5. Top Ten Cardava Producing Provinces in the Philippines, 2013

Province
Volume (MT)
Area (Ha)
Yield (MT/ha)
% to RP
Volume
North Cotabato
272,733
6,335
43.05
11%
Davao del Sur
271,165
6,685
40.56
11%
Isabela
160,271
8,620
18.59
6%
Lanao del Norte
153,414
3,860
39.74
6%
Maguindanao
90,879
8,138
11.17
4%
Samar
85,070
3,506
24.26
3%
Iloilo
80,393
7,275
11.05
3%
Compostela Valley
74,201
3,992
18.59
3%
Oriental Mindoro
73,988
6,770
10.93
3%
Davao Oriental
72,826
3,542
20.56
3%
Source: BAS/PSA
The following provinces in Mindanao were among the top producers of Cardava in the Philippines in
2013: a) North Cotabato - 272,733.03 MT; b) Davao del Sur - 271,165.41 MT, and; c) Lanao Del
Norte - 153,414.20 MT. Davao del Sur caters primarily to banana chips exporters while Lanao del
Norte sells to fresh retail markets in key urban areas. North Cotabato, on the other hand, is trying to
penetrate the fresh retail market so as to have a more diversified base of buyers. Seven of the ten
major producers of Cardava are provinces in Mindanao. These ten provinces accounted for 53% of
the Cardava production in 2013.
Mindanao regions accounted for 60% of the national Cardava production. Cardava comprised about
21.7% of Mindanao overall banana production. In Zamboanga Peninsula and Caraga, Cardava
comprised a higher percentage of the banana production while in ARMM, quantity of Cavendish and
Cardava production in 2013 was almost of the same level. Davao Region, Northern Mindanao, and
SOCCSKSARGEN produced more Cavendish than Cardava in 2013. It would seem that areas with
significant number of Cavendish banana plantations had higher yields than areas that were
predominantly producing Cardava.
19
20
Zamboanga Peninsula
A
Cardava production in the region slightly decreased from 140,001.57 MT in 2009 to 138,878.30 MT
in 2013. The steep decline in 2011 was caused by bugtok infestation primarily in Zamboanga del
Norte. Despite the increase in area planted in cardava, yield and productivity in Zamboanga del
Norte continued to be in a declining trend. Average yield decreased by an average of 6.29% per year.
Zamboanga del Norte though remains the top cardava producing province in the region.
Zamboanga City registered positive growth rate during the last five years. It had the 2nd highest
production volume in 2013 and the highest average yield 22.50 MT per hectare. Increase in
production volume can be primarily attributed to increase in productivity. There was no significant
increase in area planted between 2009 to 2013. Production Trends in Zamboanga Peninsula, 2009
to 2013
Table 6.- Cardava Production Trends in Zamboanga Peninsula, 2009 to 2013
Indicators
2009
2010
2011
2012
2013
Annual %
Growth Rate
ZAMBOANGA PENINSULA
Volume
140,001.57 143,631.06 131,130.80 131,883.57 138,878.30
-0.16%
Area Planted
8,351.00
8,399.00
8,541.00
8,550.00
8,540.00
0.45%
Average Yield
16.76
17.10
15.35
15.42
16.26
-0.60%
68,301.71
68,052.44
55,283.71
50,905.72
48,824.74
-5.70%
Area Planted
3,865.00
3,891.00
4,017.00
4,020.00
4,030.00
0.85%
Average Yield
17.67
17.49
13.76
12.66
12.12
-6.29%
22,602.33
25,877.33
25,613.83
29,699.39
37,164.87
12.89%
Area Planted
2,100.00
2,122.00
2,125.00
2,070.00
2,048.00
-0.50%
Average Yield
10.76
12.19
12.05
14.35
18.15
13.72%
12,545.47
12,244.13
12,390.15
12,708.33
12,906.76
0.58%
Area Planted
625.00
625.00
634.00
685.00
685.00
1.92%
Average Yield
20.07
19.59
19.54
18.55
18.84
-1.23%
36,552.06
37,457.16
37,843.11
38,570.13
39,981.93
1.88%
Area Planted
1,761.00
1,761.00
1,765.00
1,775.00
1,777.00
0.18%
Average Yield
20.76
21.27
21.44
21.73
22.50
1.68%
Zamboanga del Norte

Volume
Zamboanga del Sur

Volume
Zamboanga Sibugay
Volume
Zamboanga City
Volume
Source: PSA/BAS
21
Northern Mindanao
Table 7.- Cardava Production Trends in Northern Mindanao, 2009 to 2013
Indicators
2009
2010
2011
2012
2013
Annual %
Growth
Rate
NORTHERN MINDANAO
Volume
259,750.36 269,395.26 291,200.03 294,605.18 295,655.65
2.76%
Area Planted
12,831.00
12,972.00
13,084.00
13,080.00
13,076.00
0.38%
Average Yield
20.24
20.77
22.26
22.52
22.61
2.34%
21,000.00
20,970.00
20,915.00
20,875.00
20,770.00
-0.22%
Area Planted
1,630.00
1,630.00
1,630.00
1,629.00
1,630.00
0.00%
Average Yield
12.88
12.87
12.83
12.81
12.74
-0.24%
4,847.73
4,778.98
4,850.09
4,576.63
4,252.54
-2.46%
Area Planted
960.00
960.00
960.00
957.00
952.00
-0.17%
Average Yield
5.05
4.98
5.05
4.78
4.47
-2.31%
153,251.00 156,938.09 160,903.34 154,569.27 153,414.20
0.02%
Bukidnon
Volume
Camiguin
Volume
Lanao del Norte

Volume
Area Planted
3,803.00
3,803.00
3,860.00
3,860.00
3,860.00
0.30%
Average Yield
40.30
41.27
41.68
40.04
39.74
-0.27%
30,306.00
35,864.75
41,115.80
43,160.28
46,727.91
10.84%
Area Planted
2,149.00
2,190.00
2,245.00
2,245.00
2,245.00
0.89%
Average Yield
14.10
16.38
18.31
19.23
20.81
9.52%
50,345.63
50,843.44
63,415.80
71,424.00
70,491.00
8.00%
Area Planted
4,289.00
4,389.00
4,389.00
4,389.00
4,389.00
0.00%
Average Yield
11.74
11.58
14.45
16.27
16.06
9.66%
Misamis Occidental
Volume
Misamis Oriental
Volume
Source: PSA/BAS
During the period 2009 to 2013, Cardava production in Northern Mindanao increased by an average
of 2.76% per year. Although still small, Cardava production consistently increased from 2009 to
2013. Misamis Occidental had the highest average growth rate at 10.84% followed by Misamis
Oriental at 8%. Production in Lanao del Norte and Bukidnon seemed to have reached a plateau
during the last 5 years. On the other hand, production from Misamis Occidental increased by an
average of 18% per year.
Lanao del Norte was the highest producing province at 153,414 MT accounting for 51% of the total
production. Misamis Oriental ranked second with a total production of 70,491.00 MT or 24% of
22
egio s p odu tio . Misa is O ie tal a ou ted fo

% of the egio s p odu tio . Bukid o
and Camiguin produced 20,770.00 MT and 4,252.54 MT respectively.
In terms of average yield, Northern Mindanao ranked 3rd with 22.61 MT/ha, which is still quite low
compared against the 36.77 MT achieved SOCCSKSARGEN. Lanao del Norte had the highest average
yield at 39 MT per hectare. Misamis Occidental had the highest average annual growth rate in yield
at 10% followed by Misamis Oriental at 7%. This was attributed to improvements in agronomic
practices. Between the period 2009 and 2013, yield in Lanao del Norte and Bukidnon slightly
decreased by about 1%. Camiguin had the lowest average yield at less than 5 MT per hectare.
Davao Region
Despite the significant decrease in production from 571,431Mt in 2012 to 487,433Mt in 2013,
Davao Region is still the leading producer of cardava in Mindanao and in the country. Production in
the region went down due to the devastation of farms caused by Typhoon Pablo and aggravated by
infestation of bugtok and Panama diseases in 2012. During 2013 and 2014, the region focused on
rehabilitation of affected farms. Davao Region is also the leading producer of banana chips.
Davao del Sur has consistently been the top producer of cardava in the region and accounted for
57% of the total production in the region in 2013. During the past years, the average yield has
always been above 40 MT per hectare. Yield slightly declined during the recent years due to disease
infestation. The province was able to minimize the spread of the disease through good agronomic
practices.
Compostela Valley, the second largest producing province in the Region, posted a huge decline in its
production from 152,903 MT in 2012 to 74,201 MT in 2013. The province was among those that
was badly damaged by Typhoon Pablo and the Panama infestation. USAID, in partnership with the
Mindanao development Authority (MinDA), launched in 2013 the USD 5 Million Typhoon Pablo
Disaster Recovery Assistance Plan to support the rehabilitation and expansion of production areas of
cardava and other crops.
Table 8.- Cardava Production Trends in Davao Region, 2009 to 2013
Indicators
2009
2010
2011
2012
2013
Annual %
Growth Rate
DAVAO REGION
Volume
576,522.91 579,464.55 582,529.14 571,431.00 487,433.13
-3.09%
Area Planted
21,866.00
21,943.00
22,150.00
22,165.00
20,136.00
-1.58%
Average Yield
26.37
26.41
26.30
25.78
24.21
-1.64%
44,748.41
45,377.26
47,041.37
47,724.47
47,720.46
1.33%
Area Planted
4,302.00
4,353.00
4,365.00
4,378.00
4,356.00
0.25%
Average Yield
10.40
10.42
10.78
10.90
10.96
1.06%
274,391.76 272,411.54 273,087.60 270,946.19 271,165.41
-0.24%
Davao del Norte

Volume
Davao del Sur

Volume
Area Planted
6,680.00
6,680.00
6,685.00
6,685.00
6,685.00
0.01%
23
Table 8.- Cardava Production Trends in Davao Region, 2009 to 2013

Indicators
2009
2010
2011
2012
2013
Annual %
Growth Rate
DAVAO REGION
Average Yield
41.08
40.78
40.85
40.53
40.56
-0.25%
69,448.40
73,182.00
76,104.75
78,162.65
72,826.01
0.97%
Area Planted
3,984.00
4,000.00
4,200.00
4,250.00
3,542.00
-2.22%
Average Yield
17.43
18.30
18.12
18.39
20.56
3.59%
165,699.68 166,082.75 164,230.82 152,903.96
74,201.17
-11.04%
Davao Oriental
Volume
Compostela Valley
Volume
Area Planted
5,330.00
5,340.00
5,340.00
5,290.00
3,992.00
-5.02%
Average Yield
31.09
31.10
30.75
28.90
18.59
-8.04%
22,234.66
22,411.00
22,064.60
21,693.73
21,520.08
-0.64%
Area Planted
1,570.00
1,570.00
1,560.00
1562
1,561.00
-0.11%
Average Yield
14.16
14.27
14.14
13.89
13.79
-0.53%
Davao City
Volume
Source: PSA/BAS
SOCCSKSARGEN
SOCCSKSARGEN has been the only region that had a steady growth in all indicators. Production
volume increased from 320,277.32 MT in 2009 to 356,727.43 MT in 2013. During the last five years,
area planted to Cardava increased by 0.76% per year. Average yield also grew by 1.46% annually.
SOCCSKSARGEN is the second largest producer of cardava in the country after Davao Region.
North Cotabato contributed 77% of the egio s p odu tio , becoming the largest producing
province in the country in 2013, ahead of Davao del Sur. In 2013, North Cotabato had the largest
area planted with 6,335 hetares as well as the highest yield at 43.05Mt/ha. Among the provinces in
the region, Sarangani posted the highest percentage increase in production in 2013 with an average
increase of 6.24% pe ea . F o
,
MT i
, a a ga i s p odu tio i eased to ,
MT in 2013. It also had the second highest average yield at 40.62 MT per hectare. Sultan Kudarat, on
the other hand, had the highest percentage decrease in production and the lowest average yield at
11.04 MT per hectare. South Cotabato had he third highest yield in the Region with 32.03 MT per
hectare.
24
Table 9.- Cardava Production Trends in SOCCSKSARGEN, 2009 to 2013

Indicators
2009
2010
2011
2012
2013
Annual %
Growth Rate
SOCCSKSARGEN
Volume
320,277.32 321,522.95 334,400.71 348,476.78 356,727.43
2.28%
Area Planted
9,346.00
9,296.00
9,421.00
9,333.00
9,702.00
0.76%
Average Yield
34.27
34.59
35.50
37.34
36.77
1.46%
255837.99 265,981.80 272,733.03
2.39%
North Cotabato
Volume
243,628.10 246,169.66
Area Planted
5,950.00
5,960.00
5,960.00
5,975.00
6,335.00
1.29%
Average Yield
40.95
41.30
42.93
44.52
43.05
1.03%
28,794.44
28,524.15
31,587.00
35,884.00
37,780.00
6.24%
Area Planted
728.00
730.00
916.00
925.00
930.00
5.55%
Average Yield
39.55
39.07
34.48
38.79
40.62
0.54%
27,140.50
27,176.01
28,149.42
28,951.17
29,465.88
1.71%
Area Planted
893.00
906.00
910.00
916.00
920.00
0.60%
Average Yield
30.39
30.00
30.93
31.61
32.03
1.08%
20,714.28
19,653.13
18,826.30
17,659.81
16,748.52
-3.83%
Area Planted
1,775.00
1,700.00
1,635.00
1,517.00
1,517.00
-2.91%
Average Yield
11.67
11.56
11.51
11.64
11.04
-1.08%
Sarangani
Volume
South Cotabato
Volume
Sultan Kudarat
Volume
Source: PSA/BAS
CARAGA
Caraga is also in the process of rehabilitating the Cardava damaged by successive typhoons during
the last two years. The region has also been hit by the Panama disease that affected all types of
bananas in Mindanao. Land Bank of The Philippines has opened a window designed to help farmers
fund the rehabilitation and/or expansion of their production areas.
Agusan del Norte is the top producer of cardava in the region followed by Agusan del Sur and
Surigao del Sur. Surigao had the highest average yield at 20.30 MT per hectare.
25
Table 10.- Cardava Production Trends in CARAGA, 2009 to 2013

Indicators
2009
2010
2011
2012
2013
Annual %
Growth Rate
CARAGA
Volume
109,531.51 114,201.17 111,910.81 108,041.40 101,025.42
-1.55%
Area Planted
9,394.00
9,417.00
8,800.00
9,030.17
8,671.43
-1.54%
Average Yield
11.66
12.13
12.72
11.96
11.65
-0.02%
58,564.29
54,645.22
50365
43,486.11
39,176.00
-6.62%
Area Planted
3,315.00
3,305.00
3,300.00
3,275.00
2,750.12
-3.41%
Average Yield
17.67
16.53
15.26
13.28
14.25
-3.87%
16,432.95
23,784.83
29,030.05
35,321.08
31,249.05
18.03%
Area Planted
3,570.00
3,575.00
3,585.00
3,545.00
2,950.00
-3.47%
Average Yield
4.60
6.65
8.10
9.96
10.59
26.03%
6,787.00
7,483.32
6,842.55
5,204.21
6,541.37
-0.72%
Area Planted
804.00
802.00
680.00
680.00
1,786.31
24.44%
Average Yield
8.44
9.33
10.06
7.65
3.66
-11.32%
27,747.27
28,287.80
25,673.21
24,030.00
24,059.00
-2.66%
Area Planted
1,705.00
1,735.00
1,235.00
1,530.17
1,185.00
-6.10%
Average Yield
16.27
16.30
20.79
15.70
20.30
4.95%
Agusn del Norte

Volume
Agusan del Sur

Volume
Surigao del Norte

Volume
Surigao del Sur

Volume
Source: PSA/BAS
ARMM
The region produced an average of 134,697 MT of Cardava per year, which made it as the fourth
largest cardava producing region in Mindanao, yet is still the Region with the lowest average yield at
9.60Mt/ha. On the other hand, ARMM registered the highest average growth among the regions in
Mindanao accounting for 3.5% annually, with Maguindanao as the top producing province in the
region. ARMM also managed to remain less affected by diseases and luckily free of typhoons and
major natural calamities.
Maguindanao contributed 62% to total production in the Region in 2013, while Tawi-tawi had the
lowest contribution with 3%. Lanao del Sur with almost the same area planted in the past 5 years
had the highest average yield in the region at 11.7Mt/ha, nonetheless, still way below leading
producing province in Mindanao as well as the Mindanaos average yield of 20.26 MT/ha in 2013.
Basilan posted the lowest average yield in the region and in Mindanao with 3MT/ha.
26
Table 11.- Cardava Production Trends in ARMM, 2009 to 2013

Indicators
2009
2010
2011
2012
2013
Annual %
Growth Rate
ARMM
Volume
123,782.29 131,333.07 134,062.76 136,543.97 145,612.72
3.53%
Area Planted
14,493.00
14,621.45
14,989.50
15,165.00
15,173.50
0.94%
Average Yield
8.54
8.98
8.94
9.00
9.60
2.47%
14,556.84
14,531.95
14,814.03
14,122.55
13,516.75
-1.43%
Area Planted
3,739.00
3,739.00
3,739.00
3,815.00
3,824.00
0.45%
Average Yield
3.89
3.89
3.96
3.70
3.53
-1.84%
27,435.00
27,410.00
27,140.00
27,149.49
27,982.52
0.40%
Area Planted
1,200.00
1,200.00
1,200.00
1,300.00
1,300.00
1.67%
Average Yield
22.86
22.84
22.62
20.88
21.53
-1.17%
66,761.04
74,491.34
77,975.64
81,292.11
90,878.50
7.23%
Area Planted
7,591.00
7,750.00
8,137.50
8,138.00
8,138.00
1.44%
Average Yield
8.79
9.61
9.58
9.99
11.17
5.40%
10,877.11
10,830.80
10,030.00
10,028.00
9,414.25
-2.69%
Area Planted
1,600.00
1,570.00
1,550.00
1,550.00
1,550.00
-0.63%
Average Yield
6.80
6.90
6.47
6.47
6.07
-2.13%
4,152.30
4,068.98
4,103.09
3,951.82
3,820.70
-1.60%
Area Planted
363.00
362.45
363.00
362.00
361.50
-0.08%
Average Yield
11.44
11.23
11.30
10.92
10.57
-1.52%
Basilan
Volume
Lanao del Sur

Volume
Maguindanao
Volume
Sulu
Volume
Tawi-tawi
Volume
Source: PSA/BAS
27
Section :
NATURE AND STRUCTURE OF THE INDUSTRY
A. VALUE CHAIN MAPPING
FRESH CARDAVA FOR RETAIL MARKET
Marketing channels for fresh banana can be further subdivided into the following:
a) Cardava for retail markets in Metro Manila, Cebu, and other key urban centers
Northern Mindanao is the dominant player in this chain along with Davao Region and
SOCCSKSARGEN. The region ships out most of its banana to Manila and Cebu primarily via Cagayan
de Oro and Ozamis. Bananas are collected weekly from farmers at their farms or these are brought
at the nearest buying stations. Assemblers usually work with buying stations and agents and pick up
the bananas collected weekly or twice a week. The assemblers sell the bananas to consignees based
in key urban areas. The consignees sell the bananas to wholesalers and jobbers who, in turn,
distribute these to wet markets and supermarkets. In the wet markets, the greater percentage goes
to the banana cue/turon/ and other Cardava-based snack food vendors.
For business to be viable, intermediaries deal with both Cardava and dessert bananas.
Consequently, farmers in Lanao del Norte usually plant Cardava and dessert bananas in their farms.
28
Attempts have been made by some cooperatives to enter this segment but were generally not so
successful so far due to lack of volume (dealt mainly with Cardava) and limited scale of operations.
Volume and ability to keep bananas in good condition are key success factors including reliable
partners in bagsakan centers in Metro Manila, Cebu, and other key urban areas.
b) Cardava for retail markets within the locality/province

Farmers with limited volume bring their bananas to wholesalers in the wet market. Bananas are sold
oth
kilo a d
ugkus or bundled (100 pcs. or equivalent to 13-14 kilos). In some cases,
farmers sell their produce directly to households within their proximity through door-to-door
marketing or via makeshift stalls and sari-sari stores.
29
There are also traders/shippers who sell in the local market. Bananas that are almost ripe and small
are usually sold in wet markets within the region.
Bananas produced in ARMM are generally sold within the immediate locality.
PROCESSED BANANA (BANANA CHIPS/IQF SNACK FOOD)

Banana processing is dominated by the banana chips industry. A greater percentage of the banana
chips produced by Mindanao is intended for the export market. During the recent years, Mindanao
banana chip exporters have diversified into the production of individually quick frozen (IQF) Cardava
snack foods.
The processed banana supply chains can be categorized as follows:

a) Processed Banana for Export
This chain is dominated by Davao Region. Bananas are collected weekly from farmers at designated
pick-up points either by traders or directly by the banana chips exporters. An exporter would usually
have an agent or local consolidator to scout and procure bananas in a particular barangay or
municipality. Agents are usually paid on a commission basis.
30
Some exporters have set-up satellite processing plants in areas with significant Cardava banana
production. Others tried to set-up or work with first fry processing plants to reduce transportation
costs. Many of those who tried though felt that it was difficult to sustain for various reasons: a)
inconsistent quality; b) high cost of production due to lack of economies of scale and pole vaulting
of suppliers; and c) threat of recipes being passed on to competitors. As such, the general
preference among exporters is to set-up and operate their own plants in area/s with significant
volume of Cardava. Four Seasons, one to the large processors of banana chips in Davao Region, for
example, is eyeing to set-up a plant in North Cotabato. G and L, another major processor, has a
plant in Davao del Sur which is the 2nd largest Cardava producing province in the Philippines.
31
b) Banana Chips for Local Market

Processors selling to the local market get their supply directly from farmers (for agrarian reform
cooperatives), local agents, and from the wet market. Volume required by individual processors is
relatively low. The banana chips are mainly sold in pasalubong outlets.
CARDAVA SNACK FOOD
Turon, banana cue, maruya and other Cardava snacks are sold both in formal and informal food
establishments with the street food vendors/stalls having the bigger market. In Davao Region,
vendors buy their supply of fresh banana from processors, wet market, and from buying
stations/intermediaries. With the all-in procurement system, many of the medium and large scale
processors sell the non-process grade banana to vendors at PhP 8-12/kilo (fluctuates depending on
procurement price of bananas for chips). Non-process grade are either undersize, or oversize and
over 90 days maturity.
In areas other than Davao Region, main source of banana would either be the wholesalers or the
retailers depending on volume required.
32
As can be seen from the different marketing channels, there is a vibrant trade of Cardava between
and among Mindanao regions. Figure 14 shows the flow of products within and outside Mindanao.
33
B. KEY PLAYERS AND FUNCTIONS

1. Input Provision
Key inputs in Cardava farming are the planting materials, fertilizer, and pesticides. For planting
materials, majority of the farmers use suckers and corm bits which are sourced either from own
farms or from neighboring farms. In effect, production of planting material is largely a function of
crop production and agronomic practices used in the farm affect the quality of planting materials.
The common practice of using suckers and corms has contributed to the spread of pests and disease.
Although farmers indicated that they usually treat the suckers to ensure that these are pest free,
fungal, bacterial and viral pathogens are not eradicated. Farmers generally do not recognize infested
or diseased planting material nor do they fully understand the life-cycles and transfer mechanisms of
pests and diseases, especially given the continual evolution of new races and pathogens. Based on
interviews, the prevalent use of suckers vis--vis tissue cultured plantlets are due to the following
reasons:
-
Tissue culture plantlets are not readily available.

Conventional planting materials entail minimal cost or no cost at all except own labor.
Tissue cultured plantlets are considered by farmers to be very expensive.
Conventional planting materials require less input and can be planted immediately in the
field, unlike the more fragile tissue-culture plantlets, which need to be hardened before
planting. Tissue-culture plantlets also require appropriate management practices right after
being transplanted to the field
The longevity of fields planted with tissue-culture plantlets tends to be shorter than the one
for fields established with conventional planting materials.
Farmers are not aware of tissue cultured plantlets and its benefits
The Davao Region has the most number of suppliers of tissue culture plantlets. One of the biggest
suppliers of tissue culture plantlets is Bio Trends (of Lapanday Corporation). In Region 10, only
Bukidnon has a functioning tissue culture laboratory. The facility in Lanao del Norte has temporarily
suspended its operations and in need of fund infusion to re-start its operations. In SOCCSKSARGEN,
only Plantarium Biotech is known to produce tissue cultured planting materials for Cardava but
company is primarily focused on the dessert banana varieties.
In recent years, an increasing number of farmers are planting the Giant Cardava. The Giant Cardava
was first grown/discovered in the municipalities of Santa Maria and Malita in Davao del Sur. Sagrex
Foods, Inc. was among the first to use the variety in the production of banana chips and frozen
turon. It is being propagated by the company through its nominated tissue culture laboratory.
Farmer usage of farm inputs such as fertilizer, insecticides and pesticides is currently very low. Key
reasons for not using fertilizer are the following: (1) they have no money for buying fertilizer, (2)
fertilization is not necessary since they are still able to harvest every week or twice a week and
cardava has always been grown without too much care and fertilizer , and (4) fertilization is not
practical because their production is only small scale. In some banana producing areas such as
Malitbog and Tubod, there is a growing number of farmers who are using organic fertilizer. Organic
fertilizer is prepared by farmers themselves or bought from fertilizer producers. Many of the organic
fertilizer commercially sold within the region have not been subjected to scientific and laboratory
testing. Likewise, these are not formulated specifically for Cardava banana.
In the production of banana chips, key inputs are coconut oil and sugar. Large processors usually
source the coconut oil directly from the mill. Microprocessors buy oil from supermarkets.
34
Oftentimes, the price of coconut oil influences the procurement price of Cardava banana. When oil
price is high, large processors tend to lower their buying price of banana to keep their prices
competitive.
2. Farming
There are basically two types of Cardava production system in Mindanao. The first one is the
backyard production, which is the more prevalent system in Mindanao. Under this system, Cardava
banana is grown in backyards of rural households and in small farms. Size of farms under this
system ranges from 0.25 to 1 hectare. Farmers generally use suckers or culms from their own farms.
Very minimal input goes into this system of production. In cases where farmers use inputs, they
apply compost and manure. Family members share responsibilities in planting, crop maintenance,
and harvesting. Some farmers visit their bananas only when it is time to harvest the fruits.
The second system employed by farmers is the intercropping or mix crop production. In this system,
Cardava banana can be a primary or secondary crop or planted together with dessert bananas.
Farms classified under this system range from 1 to 3 hectares. In many cases, farmers use a mix of
organic and inorganic fertilizer (trickle off from fertilizer applied to intercropped crops). Generally,
the banana farms are considered as major sources of income and, as such, are better taken cared of
than the backyard farms. However, soil testing as basis of fertilizer application is rarely done.
Good Agricultural Practices (GAP) is not widely adopted. There are Cardava farmers though who are
already applying GAP in their farms. The first and only GAP certified Cardava farm is located in Sulop
Davao del Sur. It is owned and managed by Cardava Integrated Inland Farming, a cooperative
composed of agrarian reform beneficiaries.
Banana is harvested when it is still green and requires a further 5 to 10 days to ripen. Two persons
are usually needed in harvesting, namely the cutter and the helper. The cutter nicks the pseudo
stem in such a way that the bunch is lowered gently. The backer then positions himself below the
bunch and takes hold the lower end of the fruit stalks as the bunch is laid on his shoulder. The cutter
then cuts the peduncle of the fruit. From harvest to delivery, about 10% 20% of the banana is
wasted due to bruises and scratches due to poor packing and handling.
35
Cardava provides a steady cash flow for farming households. Income, however, varies depending on
practices and input application. Lack of nutrient replenishment and poor agronomic practices can
lead to a non-sustainable situation reducing yields and productive life. Current average bunch
weight is about 20 kilograms except in Tubod Lanao del Norte, North Cotabato, and Davao del Sur
(especially Malita) where a typical bunch weighs from 40 to 50 kilograms. In well-managed farms, a
bunch can weigh as high as 80 kilograms. Evidently, there is good scope to increase income of
farmers by increasing varietal performance, use of clean and improving production practices through
appropriate use of inputs and good quality clean planting materials.
Bugtok disease, hi h is a ifested
the dis olo atio a d ha de i g of the f uit e e
he
ripe, continues to threaten Cardava production in Mindanao. The ai easo fo Bugtok i fe tio
is the prevalent poor agronomic practices of farmers (and the prevalent use of suckers and corms
from own farms. Progressive farmers prevent Bugtok infection by bagging, early debudding, and
application of sodium chloride (table salt). Other diseases affecting Cardava production are Sigatoka,
Panama wilt, mosaic, and bunchy top.
3. Trading
Traders perform the important tasks of negotiating, collecting, sorting, and transporting. Traders
also act as financiers in the chain. The following are the different types of traders depending on
their scope of operations:
36
Agents/Local Traders/Buying Stations: Agents scout and procure banana from farmers in a particular
barangay/municipality. They are usually affiliated with processors and assemblers/shippers. In some
areas, tricycle d i e s also a t as age ts of fa e s. The pi k up the a a as f o the fa e s,
scout for best price offer, oversee the weighing, and deliver back the payment to the farmers.
Tricycle drivers charge hauling fee/fare and are also paid commission.
37
The local traders usually have buying stations along the highway. Most of those with buying stations
are engaged in the trading of various commodities. There are also traders who pick up the bananas
from the farms (depending on volume and accessibility. Buying stations generally do not have
sorting and storage areas adequately protected from environmental hazards and pests. The lack of
proper sorting and storage facilities results to damages and bruises which contribute to significant
postharvest losses.
Assemblers/Consolidators: They usually collect from several local traders and take care of the
delivery to processor or the shipment of the bananas to Manila or Cebu. In the case of cooperatives,
they source directly from their farmer-members.
Traders in Northern Mindanao usually carry other banana varieties such as Latundan and Lakatan to
fill up a 10 footer container van. From the collection point to the port, the bananas are transported
in a truck. Loaded bunches are closely packed and layered with green banana leaves or sliced banana
trunks to prevent shaking and bruises and to protect from heat and rain during transport.
Consignee: They source from several assemblers from different regions. The shipper and consignee
are the key players in the supply chain for they handle the biggest volume of bananas. The greatest
risk occurs during sea transport for 2 days because of high transit temperatures and the bulk-loading
practice. This can result in over ripening since a week has already elapsed since harvesting.
Jobbers/Wholesalers: distribute the bananas to retailers. Manila-based jobbers and wholesalers
generally get bulk of supply from consignees. For wholesalers in the region, they get from local
traders and directly from farmers.
4. Processing
Processors cum Exporters
Table 12.- Banana Chips Exporters in Mindanao

Note: This is not a complete list.
Region
Company
Zamboanga Peninsula
Al ia s Ba a a C a ke s
Northern Mindanao
B-G Fruits and Nuts Manufacturing Corporation
Davao Region
Arcmen Food Industries Corporation

CJ Uniworld Corporation
DOLE Philippines
Finelineasia Group of Companies
Four Season Fruits Corporation
- Also produces IQF Cardava snack food
GSL Food Enterprise
Koki Food International
Pacific Fruits International
Prime Fruits International
Profood Corporation
- Also producing IQF snack food
38
Table 12.- Banana Chips Exporters in Mindanao

Region
Company
Royce Food Corporation
Sagrex Foods Incorporated
- Also produces IQF Cardava snack food
See International
Snap Snax Ventures, Inc.
Tagum Commodities Corporation/El Coco
Tropical Synergy
SOCCSKSARGEN
Greenville Agro Corporation

South Cotabato Agri, Inc.
Caraga
Celebes Agricultural Corporation

BGC Worldwide/Basic Fruits Corporation
Nationwide, there are about thirty-five banana chips exporters. Twenty-five companies are located
in Mindanao and, of which, twenty-one (21) have their factories in Davao Region (DTI RODG Study).
About 60% of the 25 exporters have production capacity of more than 50 tons per day. Processors,
especially the big companies, indicated that they are only able to utilize 60% to 80% of their capacity
due to difficulties in sourcing Cardava.
39
Processing activities are relatively simple and technology is matured. It is the price, quality, and
availability of Cardava that are critical to its operation and competitiveness. Price of coconut oil is
also critical to competitiveness of the industry.
Sagrex Foods, Inc., a Davao-based corporation pioneered the production of frozen ripe boiled
Cardava banana including banana fries, spring roll and other microwavable Cardava snack packs. The
company has already started selling to the United States, Middle East and Canada. The company
sources some of its raw materials and semi-processed products from Bukidnon. Sagrex uses the
giant Cardava variety. Another Davao-based banana chips exporter who has diversified into frozen
Cardava snack food for the export market is Four Seasons. The company sources its supply from
Davao and Region 12 but has plans of setting up satellite plants in various parts in Mindanao if there
is a critical mass of Cardava banana supply. Four Seasons prefer to use the native Cardava variety.
Profood has also launched its IQF Cardava products.
In line with the growing demand for natural food products, exporters are increasingly shifting to
using bananas grown with minimal chemical inputs. Celebes Agricultural Corporation, a company
based in Butuan City, specializes in the production of organic banana chips. Some companies like
Koki Foods International went for the Kosher certification to differentiate their products. Four
Seasons promotes its banana chips and snack food as all natural food products.
First Fry Facilities/Subcontractors

Some exporters also tried supporting first fry facilities but only a few have been successful. For a
first frying facility to be viable, it should have a wide base of suppliers of Cardava and a production
capacity of at least 4 tons daily. Exporters are generally willing to provide some assistance (e.g.,
supply of coco oil, technical assistance), but only after the facility has proven its reliability and
trustworthiness. Peelers comprise bulk of the workers in banana chips companies and first frying
facilities. Table 13 presents a list of some of the companies engaged in first frying and production of
semi-processed/intermediate Cardava products.
Table 13.- First Fry Facilities and Subcontractors in Mindanao

Region
Company
Northern Mindanao
NM Enterprises
- Supplies to NM Enterprises
- Also produces banana chips and other Cardava based snack food
for local market
Davao Region
Kooperatiba sa Nagkahiusang Mag-uuma sa San Isidro

UFFAP-IMCOOP
SITARBA Multi-Purpose Cooperative
Mampising CARP Beneficiaries Cooperative
Kabayugan Magamay Atipolo Solar Power Association (KAMASPA)
Mayo ARB Multi-Purpose Cooperative
SOCCSKSARGEN
Magpet Agro Industrial Resources Cooperative

Pigcawayan Fruits Association (newly established facility)
40
Micro Processors
Microprocessors are mostly household-based enterprises operating with make-shift facilities. Some
of the microprocessors are Agrarian Reform Communities (ARC). The ARCs have better facilities and
packaging than majority of the individual micro businesses. Many of these enterprises do not have
the BFAD license to operate due to non-compliance to Good Manufacturing Practices (GMP). The
areas which are not usually GMP compliant are the peeling and cooking areas. Products are usually
sold in the local market and pasalubong stores.
5. Production and Vending of Snack Foods

Although there is an increasing number of medium and high end restaurants serving Cardava based
snacks by giving it a twist (e.g., serving with ice cream, mixing relatively expensive ingredients), the
biggest segment engaged in the preparation and retail sales of maruya, turon, and banana cue are
the street food vendors. It is very common to see Cardava-based snack food in rolling carts or
makeshift sidewalk stalls where there are churches, schools, recreational parks, or jeepney
terminals, and outside the malls. Most construction workers, sales ladies, office workers, and other
low- and medium-income groups grab a bite of this street food during the afternoon break time.
Street food in the Philippines is not only a convenience and an economic phenomenon; it is a
lifestyle.
A street food business is a small, fast, cash operation. Each street food enterprise is small in size,
requires relatively simple skills, basic facilities and small amounts of capital, yet they are very
numerous and have considerable potential for generating income and employment. The street food
41
industry provides employment to women and migrants with low educational background. The prices
of street food are low and the urban poor benefit from this. The street food vendors are important
market channels particularly for matured bananas (undersize/over size). A vendor purchases from
300 to 1,000 kilos per month depending on location. Vendors source their bananas from farmers,
traders, and the wet markets. In Davao region, vendors also get their supply of banana from the
processing plants.
C. NATURE OF INTERFIRM RELATIONSHIP

1. Horizontal Relationships
More farmers especially in Davao Region and SOCCSKSARGEN are taking on more functions in the
chain such as collective marketing and training services. The more established cooperatives have
ventured into first frying operations. Agrarian reform communities are generally into the production
of banana chips for the local market.
Cooperatives linked to lead firms (e.g., processors, assemblers) appear to be more successful in
scaling up their operations than those who are trying to penetrate on their own the banana chips
retail market. Success in fresh banana collective marketing and first fry operation hinges on capacity
to consolidate large volume of bananas and access to capital and transport facilities. Linkages with
lead firms and secure markets also jumpstarted the upgrading process.
There is still a need though to strengthen associations and cooperatives currently engaged in
collective enterprises. Recurrent internal organizational problems and operational inefficiencies as
they grow more successful can be addressed through continuing organizational development
assistance. Shared goals and their close link to real market opportunities will be central in further
promoting the success of the horizontal collaboration. The best trigger for closer collaboration at the
fa e s le el is the pu suit of igge and guaranteed markets.
Relationship among banana traders is generally adversarial. Banana traders compete with one
a othe i o e i g p odu e s supplies
o asio all u i g at highe p i es - say, 25 or 50
centavos higher per kilo.
Cooperation and collaboration among exporters is via the banana chips exporters association which
is based in Davao. The association holds a banana congress annually. Most of the activities of the
association are geared towards improvement of supply base, tariff and market access issues, and
market development.
2. Vertical Relationship and Supply Chain Governance
The shortage of Cardava and the entry of Manila buyers after a typhoon hit Luzon sometime in 2007
served as an impetus for Davao-based processors and traders to search for alternative options to
ensure that they are able to get their Cardava supply requirements at a price that still allowed them
to operate at a profit. To date, there is now openness among processors to develop longer-term and
more collaborative relationships with farmers. The big processors are incrementally integrating
backwards into farming communities especially those who can offer them specific advantages such
as big volume, organic/natural farming, and o siste t ualit . Ba a a hips o pa ies like ee s
International, Celebes, G and L, and Four Season have gradually shifted their approach to supply
chain development from an exclusively price offer and compliance point of view to a capacity
uildi g pe spe ti e ith a fo us o i p o i g p odu ti it , effi ie , a d ualit .
ee s
42
International and Celebes seem to be sourcing from Malitbog and their focus is primarily on the
production of organically grown banana. Sagrex International is working with communities in
Bukidnon interested to expand their production of the giant Saba.
Some of the key preconditions that entice processors and big traders to enter into strategic alliances
with Cardava farmer groups are the following:
-
Demonstration of capability to meet basic quality requirements which implies the need for
some upgrading and a good understanding of the required standards
Access to a significant volume of Cardava which calls for a well-functioning horizontal

collaboration and a cooperative or association which has significant influence among their
members and other farmers in the area or a good scheme that will encourage farmers to
consistently allocate a portion of their produce to the collective marketing/production while
allowing them to sell also to other market channels.
Willingness to invest --- Processors are more inclined to invest when they see that the
communities themselves have invested their own money/assets. Somehow, this provides a
guarantee that the communities will work towards making the venture a success.
Aligned goals and objectives both in the short and medium term
Farmer groups are more likely to enter into strategic alliances with processors and assemblers even
if the agreed price is sometimes a few centavos lower than prevailing market prices based on the
following conditions:
-
Prompt payment and willingness for on-site weighing and quality control
Transparency/honesty in terms of their production cost structure
Value adding services such as training and mentoring
Willingness to invest even if this comes in small parcels
Provision of coco oil (for first fry communities) since they find it hard to source these at
lower prices due to their lack of capacity to buy in bulk
Social involvement in the community which in the Philippines is a very important factor (e.g.,
attendance during events of the associations and/or the communities).
Willingness for community members to visit their plants --- it gives them a sort of
elo gi g ess a d ei g a i po ta t pa t of the o pa s ope atio s
I lusio i
o pa
s goals a d o je ti es
In areas farther from the base of operations of processors and assemblers, fa e s main contact is
the local intermediary. Marketing relationships between traders and farmers are informal and
ha a te ized
the o ept of the suki s ste o pe so alized e o o i elatio s. The suki
system, which is similar to the preferred supplier-buyer relations, proliferated in efforts to find ways
to minimize risks and vulnerabilities to opportunistic behaviour and cheating (both trader and
farmer). The depth of the suki relationship differs with each relation but over time, repetitive
43
transactions with the same person develops trust. On both sides, there is reduced search,
negotiation, and monitoring costs because the suki lives up to the norms and values of reciprocity
and comes close to becoming part of the family mindset. The bonds between people engaged in
exchange are determined by informal rules or social institutions and serve to enforce the terms of
the exchange. Suki relationships are often strengthened by the provision of credit by trader to
farmer or by processor/upstream actor to local trader.
In the above described supply chains, farmers are generally not aware of the end user of their
produce. Players see the a ket as ho oge ous a d i te s of the e t a to i the hai the
person who bought their produce. Traders, on the other hand, are often reluctant to share
information on where products are sold. Compliance with product and process standards is weak.
Generally, many of the constraints to the development of win-win relationships are rooted on
behaviours and attitudes. Typical behavioural obstacles include the following:
-
Aversion to learning or a lack of motivation to learn, often related to communication in the

suppl hai a d the p a ti e of all-i p o u e e t i.e., o e p i e fo all g ades and sizes),
which provides disincentives for upgrading.
Value chain participants do not learn from their actions over time because the most
significant consequences of action at any level accrue to the final product, resulting in a
vicious cycle of actions and blame.
Lack of trust results in opportunism, duplication of effort and a lack of information sharing.
The problem of mistrust creates various other problems, such as the fear of relinquishing
control.
The attitudes of usi ess as usual o

e ha e al a s do e it this a a e e uall eal
threats, as they keep people in their comfort zones and create resistance to the
transformation required for collaborative initiatives.
D. PRICE AND COST STRUCTURE

1. Income and Profit
Table 14.- Indicative Costs and Return for 1 hectare of Cardava Banana
Assumption: 625 hills/hectare
High input farm: a greater percentage of the inputs organic inputs
Amount (in PhP)
Low Input Low Yield Farm
High Input High Yield Farm
Planting Materials
1,000
10,125
Fertilizer
1,000
6,000
Items
Farm Establishment
Pest Control
5,000
Weed control
1,000
4,000
Land Preparation/Planting/Labor
5,000
8,000
44
Table 14.- Indicative Costs and Return for 1 hectare of Cardava Banana
Assumption: 625 hills/hectare
High input farm: a greater percentage of the inputs organic inputs
Total Establishment Cost
8,000
33,125
Bagging
2,500
10,000.00
Fertilizer
1,000
4,000.00
Annual Production Cost
Weed control
2,000.00
Pest control
2,000.00
Labor: Farm Maintenance
5,000
12,500.00
Harvesting
5,000
20,000.00
Transportation
5,000
20,000.00
800
3,312.25
19,300
73,812
10,000 kilograms
40,000 kilograms
1.93
1.85
Establishment cost
Total Production Cost
Yield (in kilograms)
Unit Cost/kg
Income
Unit Price/kg
5.00
5.00
Gross Income
50,000
200,000
Net Income
30,700
126,188
Profit Margin
61%
63%
Input/output Ration
2.59
2.71
Source: KII/FGD
The high input farms used as basis in the above costing use more of organic inputs than chemical
inputs. These farms invest in farm maintenance and, more or less, practices are aligned with GAP.
Yields of these farms range from 40 MT to 60 MT per hectare. Harvest is done usually twice a week.
On the other hand, the low-input is the typical farm where labor and input investments are very
minimal.
For low input farms, annual net income would only be about PhP 30,000 to PhP 35,000. Yield is
generally between 8 to 10 tons per hectare. In many cases, farmers do not buy planting materials
and use suckers from their own farm or from neighbors.
For both types of farms though, transportation cost comprise a big chunk of the expenses. The cost
indicated is for roads that are relatively good --- gravel roads, not so many potholes, and not so
muddy.
Table 14 also shows that the output: input ratio is higher for high input farms compared to the low
maintenance farms. This demonstrates better profitability and efficiency in enterprise management
amongst the high input farms as compared to the low input farms. Evidently, there is good scope to
increase income of farmers by increasing varietal performance and improving production practices
through appropriate use of inputs as well as use of clean planting materials.
45
2. Relative Financial Position of Players

Fresh Banana for Manila Market
The consolidator incurs the highest percentage of added cost which is comprised mainly of
transportation, ice, and labor costs. Given the perishability of Cardava, consolidators face the highest
risk. Main concern of consolidators is to be able to move the products as fast as possible from the
farm to the consignee in Manila. While consolidator gets the highest percentage share of the profit,
it is not proportionate to his/her percentage share of the added cost. To improve their profitability,
consolidators aim for high volume and send a mix of Lakatan, Latundan, and Cardava per shipment
(at the minimum 20 footer container).
Farming accounts for 12% of the production and distribution costs. Percentage share to profit is
43%. Although farmers generate the highest profit, the amount or absolute value that actually
accrues to an individual farmer is small for the following reasons:
a) Volume is spread thinly among the farmers: there are about 50 consolidators vis--vis more than
50,000 Cardava farmers in Mindanao. A consolidator typically sources from 5 to 10 traders. Each
trader sources fresh Cardava from hundreds of farmers.
b) Smallness of operations; lack of economies of scale
c) High post-harvest losses estimated at 20% to 40% which erodes profit margin
d) Unstable yields
46
Table 15 -. Relative Financial Position of VC Players: 1 kilo of fresh banana

Assumptions:
Harvesting and transportation costs shouldered by trader
Based on Northern Mindanao costing
Player
Product
Costs
Profit
Margins
Total
Unit Cost
Added
Unit
Cost
%
Added
Unit
Cost
Unit
Price
Unit
Profit
% Profit
Unit
Margin
% to
Price
Farmer
Fresh
1.00
1.00
12%
4.00
3.00
46%
4.00
27%
Trader
Fresh
5.50
1.50
18%
7.00
1.50
23%
3.00
20%
Consolidator
Fresh
13.00
6.00
71%
15.00
2.00
31%
8.00
53%
Total
8.50
6.50
15.00
Source: KII
Banana Chips for Export Market
Table 16.- Relative Financial Position of VC Players: 1 kilo of banana chips

Assumption:
4 kilos of fresh Cardava needed to produce 1 kilo of banana chips
Based on Davao Region costing
Player
Product
Costs
Profit
Margins
Total
Unit Cost
Added
Unit
Cost
% Added
Unit
Cost
Unit
Price
Unit
Profit
% Profit
Unit
Margin
% to
Price
Farmer
Fresh
7.60
7.60
19%
22.00
14.40
47%
22.00
31%
Trader
Fresh
27.00
5.00
13%
32.00
5.00
16%
10.00
14%
First Fry
Chips
(1st fry)
50.00
8.00
45%
53.00
3.00
10%
21.00
30%
Exporter
Chips
62.00
9.00
23%
70.00
8.00
26%
17.00
24%
9.60
100%
Total
30.40
70.00
Source: KII
A kilogram of banana chips requires more or less 4 kilograms of fresh banana. From the indicative
FOB price of PhP 70/kilo of chips, the first fryers and exporters contribute the highest added cost at
45% and 25% respectively. First fryers contribute the biggest share of the production cost as labor is
more intensive, and more oil is consumed in first frying than in 2nd frying done by processors.
Traders, on the other hand, contribute 13% of the added cost which is comprised primarily of
transportation and hauling costs. Farming accounts for 19% of the added cost.
Gross profit per kilo of chips is about PhP 30.40. Of the estimated PhP 30.40 profit generated per kilo
of chips, farmers have the highest percentage share at 47% followed by exporters at 26%. Profit
that accrues to first fryers is only about PhP 3 to 5 per kilo. For a first frying facility to be financially
viable, it has to have the economies of scale, access to coconut oil and sugar at wholesale prices, and
efficient production and procurement system. Most exporters though do their own first frying.
47
In terms of trading position, farmers have the highest risk and are price-takers primarily due to the
perishability of the product. Farmers who sell collectively and with high volume are in a better
bargaining position. Local traders, on the other hand, have the smallest investment and usually pass
increases in transportation to farmers. Exporters in the local scene are the price-makers but in
relation to importers have some capacity to participate but not always in favorable terms. In the EU,
agents and importers largely control the trade of banana chips. They perform various roles --packer, refiner of the product, processor into final product, re-exporter. Discussions with key EU
importers sometime in 2008 indicated that profit margin per unit is relatively low and tight for
banana chips. From both the perspectives of the importers and exporters, it is low margin high
volume business. Viability of the business hinges on economies of scale, cost efficiency, and cost
effectiveness.
48
Section :
MARKETS AND MARKET OPPORTUNITIES
A. MARKETS AND MARKET TRENDS
1. Export Market
Main Cardava-based product that is currently exported is the banana chips. There are three main
market segments for banana chips, namely: a) the food processing market; b) the retail market; and
c) the catering market. The food processing market is by far the largest segment for the banana
chips, thus putting pressure on prices. The major consumer is the breakfast cereal industry. Chips
are sold in two forms: whole and broken with price differences of about US$ 0.05 to 0.10. Banana
chips for the retail market are mainly sold as ready-to-eat snacks. Main outlets are the health food
stores or sections in supermarkets. Importers selling to retail markets require higher quality and
added features su h as Bio a d all atu al. All atu al a d organic banana chips command a
premium price in the market.
During the recent years, Vietnam has become a transshipment point for banana-chip exports to
China. Vietnam benefits from the trade as it enjoys advantageous tariff rates due to bilateral pacts
with China. Some Chinese buyers prefer to buy first fry chips and have these processed further in
Vietnam. The big European import companies order an average of 25 40 footer containers of banana
chips per year per company while medium and small importers order in average 10 40 footer
containers per year per company. They shift between Thailand and Philippine suppliers.
49
Table 17.- Volume and Value of Banana Chips Exports, 2007 to 2011
Year
Volume (MT)
Value (US$)
2007
32,993
40,725,000
2008
33,398
49,126,000
2009
30,347
38,350,000
2010
28,085
40,274,000
2011
30,142
50,575,000
Source: DTI/Presentation of DTI Undersecretary Merly Cruz
GL P e iu Food E po t a d Fou easo s, t o of o ld s leading suppliers of banana chips,

collectively export about 2,000 MT of banana chips per month. According to them, there is an
i easi g de a d fo a a a hips. Du i g the e e t alo I te atio al de l Ali e tatio o IAL
Paris fair, banana chips were among the most saleable products in the Philippine booth. From 2007
to 2011, Philippines exported an average of 30,993 MT of banana chips.
Although the Philippines has remained the leading exporter of banana chips, competition is also
intensifying from countries like Vietnam, Thailand, and Malaysia in key export markets. Markets are
increasingly concerned with the specifications of both products and processes further back along the
value chain in a number of different ways: a) quality and safety - based upon product and process
controls: b) conformance with social and environmental standards; c) traceability and authenticity;
d) reliability and guaranteed supply in order to avoid stock outs; e) just-in-time delivery; and f)
product differentiation and innovation as a means of adding value and margins.
Export of frozen cooked banana (turon, boiled banana, fries, etc.) is gradually increasing. The
companies are targeting the 12 million Filipinos living abroad --- the Kingdom of Saudi Arabia (KSA)
has 1,019,577 Filipinos, the United States of America has four million, Malaysia 822,910, Canada
437,940, Japan 258,977 and United Arab Emirates 250,000. Other countries that have thousands of
Filipinos also include Italy, Mexico, United Kingdom, Taiwan, Singapore, Hong Kong, Australia,
Kuwait, South Korea and Germany. Sagrex exports annually over 12 containers of Saba to the Middle
East, US, Canada and other Asian markets
2. Domestic Market
System of grading and classifying Cardava type bananas is provided in the Philippine National
Standard (PNS) formulated by the Bureau of Agriculture and Fisheries Product Standards (BAFPS).
However, in many cases, traders a d etaile s follo the all-i p o u e e t s ste
ut still
observe the following minimum requirements as set forth in the PNS:
-
The fruit must be reasonably clean, free from diseases, insects, molds, and other
contaminants.
The use of chemical process for ripening is allowed provided it conforms to PNS/SAO 74.
Pesticide residues shall meet the requirements of the Codex Alimentarious Commission
Volume 2.
The above requirements are checked by buyers using visual observation (mata-mata).
Size is determined according to the diameter and length of the fruit. Traders generally classify the
cardaba on whether these are processed grade (for the banana chips market), for the snack food
market, and for the fresh market .
50
Table 18.- Size Classification of Cardava Banana

Size
Length (cm)
Diameter (cm)
>14
>4.5
Large
12 - 14
4.5
Medium
10 - 12
4.0
Small
Not <8
3.5
Extra Large
Source: PNS
Based on the PNS, the following are the three classes of Cardava banana based on general
appearance, quality, and condition:
a) Extra Class: Bananas in this class are of superior quality. Hands must be matured, clean, wellformed, and well-trimmed. Likewise, the hands must be free from decay, split fingers, loose
fingers, bruises, blemishes, and discoloration caused by diseases, insets, latex burn, and other
deformities.
b) Class I: These are bananas classified as good quality. Hands must have the same characteristics
as the Extra Class bananas.
c) Class II: Bananas in this class do not qualify for inclusion in the above 2 classes but satisfy the
minimim requirements. Hands are matured, reasonably clean, fairly well formed, and welltrimmed. These are also relatively free from decay, split fingers, loose fingers, bruises,
blemishes, discolorations, and other deformities.
Traders generally do not provide premium prices for Extra Class and Class 1 bananas but they do not
accept bananas that do not meet the minimum requirements. In the retail market, prices are
oftentimes aligned to the classification system.
Total available supply of Cardava in Mindanao is generally just about 60% to 70% of its total
production. Postharvest lesses are estimated to be about 30% to 40% of total production. About
32% of available supply (production less postharvest losses/feeds) is utilized for banana chips and
other processed products. The largest bulk goes to the processing companies geared for the export
market. Industry players estimate that processing companies are able to source an average of
350,000 MT of Cardava per year. Total annual requirement of processors/exporters in Mindanao is
estimated to be about 450,000 MT. The processors selling to the local market consume an
aggregate of 15 to 20 MT of Cardava per year.
Banana chips exporters prefer the native variety rather than the Giant Cardava. They are strict with
quality standards. Quality of banana significantly affects the quality of banana chips. Bananas
delivered to exporters should conform to the following standards: a) semi-mature (90 to 105 days);
b) unripe, green color of skin; c) light yellowish color of flesh; and d) not less than 3 inches in length.
With increasing demand for healthy food products, exporters prefer organically grown bananas. On
a e age, a out
pe e t of a a as deli e ed to p o esso s a e lassified as eje ts . Mai
causes of rejects are immature harvesting, late harvesting, and bruises and damage during storage
and transit.
51
For Philippine supermarkets, the banana chips are among the slow moving products and, thus, no
significant orders are made. Likewise, in many cases, presentation is poor compared to similar
p odu ts i the sa e atego ies. The e is a ge e al p efe e e fo potato hips t pe of p odu ts
rather than the usual presentation of banana chips.
Basic requirements for suppliers: GMP/permit to operate and bar code which many of the
processors are not able to comply with. Suppliers would have to invest in the promotion of the
products and in development of similar product formats such as the potato chips.
Ba a a hips a e u e tl
o e salea le as pasalu o g . The p odu t a potentially be saleable
if positioned as a healthy snack food. To be successful in this positioning, it is important that the
chips are produced without preservatives and artificial additives and all other ingredients are
health e.g. lo gl e i sugar, low cholesterol oil, etc.).
About 62% of total available supply or an average of 600,000 to 800,000 MT are sold in the domestic
market. Mindanao banana (all types) production for the domestic market goes to Cebu and MetroManila largely through ports in Cagayan de Oro, Agusan, Ozamis, Iligan, and Surigao. Based on 2009
data, about 73% of the banana shipped out of Mindanao seaports originated from the port in
Cagayan de Oro, an additional 15% came from the port in Nasipit, Agusan, while about 4% were
loaded in Sasa Wharf in Davao City. One of the advantages of Northern Mindanao aside from quality
is that it takes only 30 hours for shipment to reach Manila from Cagayan de Oro. It takes 56 hours to
reach Manila from General Santos and 48 hours from Davao.
52
Table 19.- Banana Shipments from Mindanao, 2009

Port of Origin
Quantity
(in MT)
% Share to National
Banana Shipment
Iligan City
1,233.05
0.49
Cebu, Siquijor
Ozamis City
4,959.32
1.99
Cebu, Manila
Cagayan de Oro City
182,381.23
73.04
Cebu, Manila, Iloilo,

Tagbilaran, Bacolod,
Butuan
Sasa Wharf, Davao City
10,229.81
4.10
Manila, Cebu, Iloilo,

Zamboanga
TEFASCO, Davao City
1,489.47
0.60
Manila
0.26
Cebu
39,430.14
15.79
Manila, Cebu, Iloilo,

Bacolod, Bohol
4,251
1.70
Southern Leyte
Makar Wharf, General

Santos City
Nasipit,
Norte
Agusan
Surigao del Norte
del
673.54
Destinations
Traders and farmers interviewed indicated that export of banana to other regions outside of
Mindanao is on an increasing trend but price competitiveness and freshness are important criteria.
For Mindanao to remain competitive vis--vis other Cardava producing areas in Luzon, consolidators
opt to lower their profit margin and aim for high volume sales. Banana trading suffered a decline in
the previous years due to supply constraints brought about by the destruction of many farms caused
by Typhoon Sendong.
The biggest market for Cardava in the domestic market is the Cardava-based snack food subsector
consisting primarily of street vendors, canteens, and restaurants. Street food vendors usually
procure the stock of Cardava on a daily basis from the wet market, trader, or processors (in the case
of Davao City). A vendor would usually buy about 10 to 50 kilos of Cardava on a daily or bi-weekly
basis. Vendors generally buy ripe, oversize, and undersize bananas. Ripe bananas are generally
heape o pa ed to the atu ed a a a.
In a snapshot survey conducted sometime in 2008, banana cue was the top favorite of low-income
workers and school children. Respondents, however, expressed the need for variety and more
hygienic presentation but within the same price range. Similarly, vendors wanted to expand their
product lines to retain and attract more customers given the increasing numbers of low-end fast
food chains. With low profit margin, vendors needed to sell to a critical mass in order to generate
enough income to cover basic daily needs.
Cardava-based dishes and snack food are also mainstays in the menu of many of the hotels,
restaurants, and caterers. Cardava bananas sold in supermarkets are usually the Extra Class and
Class I. In Metro Manila supermarkets, a piece of Cardava banana costs from PhP 3 5 per piece of
PhP 30/kilo.
Demand for Cardava both for banana chips and the fresh market is generally lowest during the
months of April, May, and June. For the banana chips subsector, production is generally low as
companies use this period as an opportunity to perform maintenance in their plants in preparation
for the peak season and to finalize negotiations. In the fresh subsector, vendors purchase fewer
bananas during vacation time as bulk of their customers are usually the students.
53
B. PRICE TRENDS
1. Export Market
Major threats to the growth of the industry are its price competitiveness and its ability to maintain
quality particularly for large volume orders. Banana chips are fast becoming a commodity with price
an important issue. Price fluctuations range from 1% to 5%. Importers generally switch suppliers
between Philippines and Thailand from time to time primarily due to price and quality
considerations. Feedbacks indicate that Thailand is fast becoming preferred supplier in terms of
price, flexibility in payment terms, reliability, and their ability to offer a wider range of goods in
similar categories including strong support and relations between the private sector and
government.
2. Domestic Market
Based on interviews, farm gate price of Cardava fluctuates between PhP 4 to 7 per kilo. At the time
of interview, the farm gate price hovered between PhP 4.00 to 5.00 even in Maguindanao. Based on
BAS data, average price in Maguindanao was at PhP 17.78. Unfortunately, farmers interviewed were
not aware of this significantly high price. The highest price enjoyed by farmers in Mindanao was
about PhP 10 to 12 per kilo sometime during the end of 2013 to March 2014. The farm gate price of
Cardava for local consumption is primarily based on supply and demand. This is usually determined
by the consignees. As bananas ripen, the price becomes lower.
54
Generally, banana chips exporters and agents offer a slightly higher price if a farmer or a group of
farmers is able to consistently supply more than 1 metric ton of banana per delivery. Main
determinant of price is distance between pick-up point and plant location. Another factor that
affects the buying price of Cardava for the banana chips industry is the price of coconut oil. Banana
and coco oil comprise the largest cost in the production of banana chips. Since coco oil price is
outside of their control, slight adjustments are usually made in the purchase price of Cardava as
export price of banana chips is usually fixed for a specific period.
Table 20.- Farm Gate Price of Cardava in Mindanao Regions, 2009 to 2013
Price per Kilo (PhP/kg)
Region
2009
2010
2011
2012
2013
Annual %
Growth
Rate
Philippines
6.19
6.87
6.51
7.01
8.35
6.98%
Mindanao
5.81
6.76
5.94
7.06
8.84
10.44%
Zamboanga Peninsula
6.32
6.66
7.17
7.37
8.41
6.61%
Northern Mindanao
9.1
11.83
7.87
6.64
7.61
-3.27%
Davao Region
4.78
4.89
4.76
5.51
7.77
12.51%
Soccsksargen
3.86
4.94
5.2
5.29
6.99
16.22%
Caraga
4.72
5.12
5.94
5.83
7.28
10.85%
ARMM
6.05
7.1
4.7
11.71
14.95
29.42%
Source: BAS/PSA
55
Section :
SUPPORT SERVICES
A. FINANCIAL SERVICES
Smallholders generally do not have the collateral nor signed contracts with buyers that they can
present to banks. As such, farmers and resource poor players generally have limited access to
formal finance and are also hesitant to avail of loans from banks and MFIs. Resource poor players,
therefore, borrow money from informal sources such as traders because these are accessible;
require no collateral and voluminous documents like those required by formal lending institutions.
Demand side barriers that limit the access of smallholders to financial services can be summarized as
follows:
a) Weak producer organizations/ High risk aversion among farmer groups: many of financial
products are anchored on cooperatives/associations
b) Dominance of spot transactions which make it impossible for smallholders to present marketing
agreement as collateral (e.g., for LBP-DA Food Supply Chain Program )
c) Low financial literacy and financial management skills
d) Low productivity, margins, and cash flow for servicing loans
Financial institutions in the Philippines have quite a wide range of products and add-in services that
attempt to serve the needs of Cardava farmers while managing the risks of lending to them. The
cash flow-based lending, for example, that uses regular household cash flow analysis and collects
payments frequently provides a valuable line of credit for households engaged in farming activities
but may not be appropriate among marginal farmers who do not have other sources of income.
Production cost-based lending provides more promise to increase profits and help marginal farmers
without other sources of income to mitigate the uncontrollable risks to agriculture.
B. NON-FINANCIAL SERVICES
Government agencies especially the local government units are the main providers of extension
services to the Cardava banana farmers. Services are provided for free and/or socialized payment
tending to heavy subsidy. During the recent years, the Department of Agriculture Agricultural
Training Institute (ATI), local government units, and the Bureau of Agricultural and Fisheries Product
Standards (BAFPS) have been working together to promote the adoption of Good Agricultural
Practices among smallholders. Owing to resource constraints, outreach, depth, and breadth of
services are limited. The resource limitations of the local government necessitated that budgets and
extension personnel are allocated to all agricultural sectors.
Learning among smallholders is generally via peer coaching or on-the-job training (older family
e e s tea hi g the ou ge ge e atio . The i fo al e to s a e p ofi ie t i the t aditio al
banana farming system but lack the exposure to new technology and practices to ensure high yield
and consistent product quality. Likewise, whether services are embedded or fee-based or even free,
farmers are more receptive to services with immediate impact on income. Farmers are generally
very risk adverse resulting to low buy-in, and low level of adoption of new technology and practices.
This is sometimes because impact of services received in the past was not that tangible.
56
Support services are available to assist processors in the different areas of their businesses. The
Department of Trade and Industry (DTI) through the Product Development and Design Center of the
Philippines (PDDCP) offers package and label design services. DTI has also been working with
processors in the development of new variants of the banana chips. DTI, DA, and local government
units have been active in supporting the participation of enterprises and farmer groups in domestic
and international trade fairs. Likewise, the Department of Science and Technology (DOST) and DTI
provide training on Good Manufacturing Practices (GMP) and Hazard Analysis and Critical Control
Points (HACCP).
In in intermittent basis, street food vendors receive enterprise development training and assistance
in upgrading their facilities from the local government units, the Department of Labor and
Employment (DOLE). There is, however, a lack of services that would help them improve their
products and compliance to food safety.
57
Section :
ENABLING ENVIRONMENT
A. FORMAL RULES, REGULATIONS, AND POLICIES
Key policies that are relevant to the banana chips industry are:
1. Policy and implementing guidelines for food safety are in place but implementation has been
constrained by:
-
Lack of providers to provide assistance and assess GAP/GMP compliance

Too technical presentation creating immediate resistance among farmers and
enterprises
Farmers and enterprises lack awareness and knowledge on its benefits and scopes
Stakeholders lack capability to comply with market requirements in terms of quality
standards, competitive prices and food safety
LGU extension officers generally not equipped and trained to enforce food safety
regulations
Lack of harmonization between private and public GAP/GMP/HACCP audit
requirements.
Implementation of food safety policies has to be addressed alongside policy harmonization and
capability building.
2. Poor road condition results to high transportation costs and limited access to product and
support markets. These infrastructure investment requirements are public goods and should be
funded by the government.
3. For more than a decade, most government efforts to expand access to agricultural credit have
been channelled through the Agricultural Competitiveness Enhancement Fund (ACEF) and AgroIndustry Modernization Credit Finance Program (AMCFP). Outreach, to date; of the two
programs have been limited. The Agri-Agra Reform Credit Act of 2009 (Republic Act 10000)
sig ed i Fe ua
has ot also ee effe ti e i fa ilitati g s allholde s a ess to
financial services. There is a need for government to put in place a sound risk management
framework to address the issues that are at the core of private sector reluctance to lend and
fa e s hesitatio to a ail of fo al fi a ial se i es.
B. INFORMAL RULES AND SOCIO-CULTURAL NORMS

1. Informal rules can contribute to the effectiveness of formal rules. If the norm is to abide by
formal rules (e.g., adherence to grading standards even if the buyer does not always check), then
it e o es less ostl to e fo e the egulatio s. If this is ot the ase e.g., all i procurement
as the norm in cocoa bean trading) then the standards set by government agencies become a
pape tige o a su sta tial a ou t of esou es is eeded to e fo e the egulatio s e.g.,
buyers have to send their own people to check on quality right at the point of purchase). Norms
of civic cooperation reduce enforcement costs by leading individuals to internalize the value of
standards and regulations even when the probability of detection for violation is negligible.
58
2. The major sources of social capital among Filipino farmers are kin networks, home
eigh o hood, fa
eigh o hood, a d e e ship i a fa e s asso iatio . Filipi os
particularly in rural areas give premium to interpersonal relations. Kinship reigns above all the
social relations of Filipino farmers followed by farm neigbor relationship. It is characterized by
strong ties, mutual trust, and norms, which promote coordination and cooperation for mutual
benefit. Harnessing the kinship/interpersonal relations factor can reduce transaction cost in the
sharing and diffusion of farming technology.
3. Another value related to loyalty is utang na loob or debt of gratitude. It is expected that those
who are helped in their time of need will return the favor when the opportunity comes. So, a
trader or a lead farmer or buyer sharing technology with kins and peers can also be regarded a
form of repayment from utang na loob or depositing a help to be withdrawn later when need
arises (e.g., trader expects that farmer will give him some priority when cocoa bean supply is
tight).
4. Buying in tingi or piecemeal is the norm rather than an exception in the Philippines. Long before
multinationals and large local companies began producing product sachets, sari-sari stores
(neighbourhood stores) would buy household items such as sugar, vinegar, shampoo, cooking
oil, cigarettes, etc. in bulk and sell these to the customers in piecemeal: by the stick, by the
pie e,
the ta lespoo o up. The ti gi s ste has sp ead i to a ious i dust ies su h as
telecommunications where it became possible for users to buy phone credit or load for as low as
PhP 5.00.
The tingi or piecemeal mentality influences much of what the Filipinos do. The tingi mentality is
also ei fo ed ith Filipi o s elati el lo p ope sit to sa e, a d p efe e e fo i
ediate
gratification. This is manifested even in little things, such as thei p efe e e fo i sta t p ize
promotions rather than loyalty programs which might require them to accumulate points toward
a larger prize (De Veyra 2004). Spending more to purchase sachets today instead of saving up to
buy in bulk would be consiste t ith this te de . Like ise, the do i a e of the ti gi
mentality can also be correlated to general aversion of Filipinos to risks.
As such, in the conduct of training and capacity building activities as well as introduction of new
technology and innovations, the p og a
a uild the desig a ou d this ti gi
e talit to
have higher chances of success and adoption.
59
Section :
CONSTRAINTS AND OPPORTUNITIES
Table 21.- Constraints and Opportunities
Opportunities
Constraints
Province
INPUT PROVISION
Use of tissue cultured planting
materials can significantly
improve yield of farmers
Village level nurseries can
potentially reduce cost of
tissue
cultured
planting
materials
and
provide
additional income to farmers
Limited supply of good quality

disease free planting materials/
Lack
of
tissue
culture
laboratories
ZAMBOANGA PENINSULA
Zamboanga del Norte
Zamboanga del Sur
Zamboanga Sibugay
Zamboanga City
Low willingness among farmers

to invest in good quality
planting materials
NORTHERN MINDANAO
Bukidnon
Camiguin
Lanao del Norte
Misamis Occidental
Misamis Oriental
DAVAO REGION
Davao del Norte
.Davao del Sur
Davao Oriental
Compostela Valley
Davao City
SOCCSKSARGEN
North Cotabato
Sarangani
South Cotabato
Sultan Kudarat
CARAGA
Agusan del Norte/Butuan City
Agusan del Sur
Surigao del Norte
Surigao del Sur
ARMM
Basilan
Lanao del Sur
Maguindanao
Sulu
Tawi-tawi
The choice of planting material has a significant impact on both yield and fruit quality. Farm
productivity has come under increasing threat from the spread of viruses and other phytosanitary
problems transmitted in vegetative planting material. The common practice of using suckers and
corms from own farm or from neighbors has contributed to the spread of pests and disease.
Fa e s de isio on which planting material to use is primarily determined on issues of accessibility
and affordability.
Proper
application
and
management of fertilizer and
pesticides together with use of
quality planting materials and
High cost of chemical inputs

Limited availability and
commercial distribution of
ZAMBOANGA PENINSULA
Zamboanga del Norte
Zamboanga del Sur
Zamboanga Sibugay
Zamboanga City
60

Opportunities
good agronomic practices can
potentially result to yield of 50
to 80 kilos per bunch
Agri-waste can be used in the
production of organic fertilizer.
There
are
also
existing
enterprises
engaged
in
production of organic fertilizer
but not specifically for banana
Constraints
organic fertilizer and inputs
Lack of understanding among
farmers on cost benefits of
proper and efficient use of
fertilizer/Only very few farmers
apply fertilizer
Low level of purchasing power
among smallholders
Province
NORTHERN MINDANAO
Bukidnon
Camiguin
Lanao del Norte
Misamis Occidental
Misamis Oriental
DAVAO REGION
Davao del Norte
.Davao del Sur
Davao Oriental
Compostela Valley
Davao City
SOCCSKSARGEN
North Cotabato
Sarangani
South Cotabato
Sultan Kudarat
CARAGA
Agusan del Sur
Surigao del Norte
Surigao del Sur
ARMM
Basilan
Lanao del Sur
Maguindanao
Sulu
Tawi-tawi
Bananas remove large amounts of soil nutrients with the harvest of fruit bunch. Lack of nutrient
replenishment can lead to reduced yields and shorter productive life. Use and application of
fertilizer are primarily based on available money and assessment of potential returns. Most farmers
refer to a lack of money to buy inputs when discussing the problems to increase the productivity of
their farms. Anecdotal evidence also suggest that many of the farmers have been applying fertilizers
without regular soil tests to determine the exact type of fertilizers that are required to improve and
maintain soil fertility
Although there are a number of organic fertilizer available in Mindanao, efficacy and effectiveness of
many of the products have not been scientifically tested. The production of organically grown
Cardava can provide Mindanao with a competitive advantage over other Cardava and banana chips
producing areas/countries especially with the increasing attention given to food safety and the
effects of chemical inputs to both people and the environment.
FARMING
Upgrading of low cost
indigenous technologies that
have good potentials of
improving farm productivity
and reduce incidence of pest
and disease infestation
Limited outreach of existing

extension services
Cardava traditionally grown
with minimal investments on
farm maintenance
ZAMBOANGA PENINSULA
Zamboanga del Norte
Zamboanga del Sur
Zamboanga Sibugay
Zamboanga City
NORTHERN MINDANAO
Bukidnon
Camiguin
61

Opportunities
There are progressive farmers
in Lanao del Norte, North
Cotabato, and Davao Region
especially Davao del Sur who
have been trained in GAP and
are willing to share best
practices with peers
Interest among cooperatives
and traders to increase
volume/ yields to get premium
prices (traders pay higher
prices if farmers/groups deliver
significant volume)
Constraints
Low uptake and adoption of
Good Agricultural Practices
Province
Lanao del Norte
Misamis Occidental
Misamis Oriental
DAVAO REGION
Davao del Norte
.Davao del Sur
Davao Oriental
Compostela Valley
Davao City
SOCCSKSARGEN
North Cotabato
Sarangani
South Cotabato
Sultan Kudarat
CARAGA
Agusan del Sur
Surigao del Norte
Surigao del Sur
ARMM
Basilan
Lanao del Sur
Maguindanao
Sulu
Tawi-tawi
Although Cardava provides a steady cash flow for farming households, profits are below what can be
possibly generated from a well-managed Cardava farm. Low productivity and income translate to
issues on price competitiveness and erratic supply base. Improving agricultural practices would
address issues of productivity, efficiency, and quality. This would improve profit margins of all actors
in the chain particularly the smallholders.
Cardava production in Mindanao is affected by a number of pests and diseases. Poor agronomic
practices have been identified as one of the key causes of the widespread pest and disease
infestation. Adoption of good agronomic practices will also contribute to reducing rejects due to
fruit quality issues.
GAP promotion related interventions by DA/ATI/HVCDP, non-government organizations (NGOs) and
private sector have contributed to significant improvement in production and productivity.
However, the reach has not been extensive enough, leaving a large segment of Cardava farmers out
of the benefits of those interventions.
Adoption of GAP among farmers has also been slow and low. In many cases, there is still a lack of
understanding among farmers on cost benefits of GAP compliance. The Filipino farmers are
calculating and generally reluctant to changes in their farming activities for this is their way of life.
They have the "wait-and-see" attitude. Although many farmers are very much open to new ideas
and technology, there are more farmers who would first want to see a working model or system
before they follow the lead. Likewise, farmers also lack the resources to comply with GAP. To
facilitate adoption of GAP, farmers need both training and on-farm mentoring and monitoring
including assistance in aligning current production system to GAP at the least cost.
62

Opportunities
Constraints
Province
PROCESSING
Implementation and adoption
of standards such as GMP can
play a positive role in providing
the catalyst and incentives for
the modernization of the
banana chips industry and the
adoption of safer and more
sustainable production and
processing activities which can
be differentiation factors that
can institutionalize market
competitiveness
Lack of access to skills and

resources to comply with GMP
(especially micro enterprises)
Street food preparation not
aligned with food safety
protocols
ZAMBOANGA PENINSULA
Zamboanga City
NORTHERN MINDANAO
Bukidnon
Misamis Oriental
DAVAO REGION
Davao del Sur
Davao del Norte
Davao City
Davao Oriental
Compostela Valley
SOCCSKSARGEN
North Cotabato
Sarangani
CARAGA
Agusan del Norte
GMP compliance is a basic requirement to get permits to operate which are necessary to penetrate
institutional buyers and to work with big exporters. Without the basic BFAD certification,
enterprises are not able to penetrate bigger and more lucrative markets.
Microprocessors make use of makeshift cooking facilities and areas. Poor processing facilities are
compensated with use of premium quality Cardava which is more expensive.
A common prejudice held against street foods are that they are unsafe to eat (dirty). Food products
are often prepared and stored under non-sanitary conditions. The preparation and processing of
food also influence nutrient loss and, thus, affect the nutritional quality of the product. Similarly,
ingredients can enhance or deteriorate health and nutrition benefits of ready to eat Cardava based
meals and snacks. Likewise, it also affects perceived value of products.
MARKETING
The shelf-life of bananas can be
prolonged by proper storage
and postharvest handling
Poor postharvest handling and

facilities especially among
buying stations resulting to
high levels of losses
ZAMBOANGA PENINSULA
Zamboanga del Norte
Zamboanga del Sur
Zamboanga Sibugay
Zamboanga City
NORTHERN MINDANAO
Bukidnon
Misamis Oriental
Misamis Occidental
Camiguin
Lanao del Norte
DAVAO REGION
Davao del Norte
63

Opportunities
Constraints
Province
Davao del Sur
Davao Oriental
Compostela Valley
Davao City
SOCCSKSARGEN
North Cotabato
Sarangani
South Cotabato
Sultan Kudarat
CARAGA
Agusan del Sur
Surigao del Sur
ARMM
Maguindanao
Handling the produce at the postharvest stage is as important as maintaining the quality of the fruit
at the farm production level. Postharvest losses at buying stations can reach up to 20% due to lack
of appropriate facilities and losses to vermin and other pests.
The very large population in the
Philippines and increasing
consciousness for healthy snack
food provides opportunities to
develop the local market for
other processed Cardava based
products
Growing market
products
for
halal
Weak demand for banana chips

in local market
ZAMBOANGA PENINSULA
Zamboanga del Sur
Zamboanga City
Lack of product differentiation/

available product formats
NORTHERN MINDANAO
Bukidnon
Misamis Oriental
Lack of value addition in ARMM

provinces
DAVAO REGION
Davao del Sur
Davao City
SOCCSKSARGEN
North Cotabato
Sarangani
CARAGA
Agusan del Norte
ARMM
Maguindanao
Lanao del Sur
Basilan
Sulu
Tawi-tawi
T ade of a a a hips is ofte li ited ithi the lo alit a d pasalu o g shops. To oade the
market base and increase frequency of purchase of banana chips in the local market, a new
marketing concept has to be introduced to (re)position the product in the minds of the consumers.
A positioning that combines gourmet snack food, with an ecological and healthy lifestyle can
potentially add to the current volume of sales without affecting current positioning as a
pasalu o g p odu t.
The lack of initiatives among processors especially the micro enterprises and collective/coop-based
enterprises to develop and diversify products can be attributed to the following: a) lack of
64

Opportunities
Constraints
Province
knowledge of potential market segments and its requirements and product standards are based on
locally accepted norms; b) weak product development skills; and c) smallness of operations and
current markets including limited individual capacity to invest in product development.
In ARMM provinces (especially the island provinces), trade of Cardava is usually just within the
locality. The processing of banana into halal snack products can provide opportunity for small
producers and farmer groups to increase the value added to primary production.
LGU willing to cost share in the
construction and maintenance
of farm to market roads.
Poor farm to market roads
All Mindanao provinces

Basilan, Sulu, and Tawi-tawi
except
Good roads can reduce cost of

transactions, delays in delivery,
and postharvest losses
A significant number of farms are located in areas where roads are unpaved and, oftentimes, narrow
for trucks to pass. There is a significant difference in the cost of moving goods in rural areas on dirt
roads as opposed to on paved roads. This difference is usually reflected back on the price received
by farmers. Likewise, road conditions and, consequently, the high transport costs, provide
disincentives for traders to source from these areas. This limits the options of farmers to a few
traders and forces them to be price takers. Rough roads and potholes combined with poor
packaging contribute to postharvest losses.
65
Section :
COMPETITIVENESS DIRECTIONS
A. COMPETITIVENESS VISION
The i dust s isio of eati g lo g-term competitiveness and sustainability centers on the
establishment of an efficient and integrated supply chain management geared towards the
achievement of the following:
g) Adequate supply and widespread use of tissue cultured planting materials to minimize risks of
pest and disease infestation and, consequently, ensure stable supply of Cardava
h)
Improved access to, availability, use, and utilization of organic fertilizer and other inputs
appropriate for Cardava banana farming while reducing environmental costs
i)
Enhanced flow and quality of extension services for Cardava farming to facilitate adoption of
GAP for improved productivity and product quality
j)
Improved access to GMP compliant postharvest and distribution technologies and facilities to
reduce postharvest losses and maintain product quality
66
k) Availability and access to improved processing technologies, product development services,

and GMP and Halal compliant common service facilities to facilitate the production of
commercially viable Cardava-based products
l)
Improved physical/infrastructure linkages to input, support, and product markets
B.
PRIORITY CONSTRAINTS/OPPORTUNITIES AND INTERVENTIONS
Drawing on findings from the end markets and value chain analysis and the focal points of action
identified by VC actors and stakeholders, below are the proposed intervention strategies and
approaches to improve market competitiveness of the Mindanao Cardava banana industry while
promoting broad based growth and climate change resilience. Prioritization of interventions for
each of the Cardava producing provinces is presented in Annexes 1 to 6 while specific approaches for
each province are indicated in Table __.
Input Provision
1. Strengthen local capacity to commercially produce and distribute high yielding and disease
resistant planting materials
Although tissue culture technology is well developed in the Philippines, tissue cultured plantlets are
not readily available to many of the banana smallholders due to insufficient and relatively
underdeveloped distribution channels. A limited understanding of the benefits of tissue cultured
planting materials has also contributed to limited uptake among farmers.
The proposed strategy to promote the use of tissue cultured planting materials among farmers
rather than the conventional suckers from own farm or neighbors which have greater risk of being
infected with diseases is focused towards the development of improved and efficient market
pathways to deliver clean planting materials. The set of suggested intervention approaches consists
of two basic components, namely: a) strengthening the supply of tissue cultured planting materials;
and b) stimulating the demand for these planting materials.
Key supply side interventions consist of the following:
a) Establishment and/or scaling up of existing tissue culture laboratories in key Cardava producing
provinces. Main objective is to enable laboratories to produce plantlets at the most economical
cost and in sufficient quantity throughout the year.
b) Set-up of community-based nurseries for acclimatization and as distribution centers to ensure
accessibility and reduce risks of damage due to poor packaging and transport.
c) Upgrading of seed banks to support the operations of the tissue culture laboratories
To stimulate effective demand for tissue cultured plantlets, PRDP can implement a voucher based
program or a Plant Now Pay Later scheme or other similar demand creation mechanisms rather than
the usual distribution of free planting materials which undermine the development of effective
demand and supply. In a voucher program, farmers pay for a portion of the cost of planting
materials and redeem the voucher to a program accredited supplier of their choice. A voucher
program helps increase effective demand by making farmers aware of the improved planting
materials available within the locality and allowing them the opportunity to acquire small quantities
67
of these materials at low risk and investment to test on their farms, which they might then purchase
for themselves in subsequent seasons. The use of vouchers can also help in strengthening cash flow
of nurseries as well as encourage operators to provide good quality to generate repeat clients.
It is also recommended that PRDP develops the capacity of nurseries to deliver embedded technical
assistance to their clients. Assistance to nurseries in the establishment of model farms as learning
venues where clients can visually validate results to make informed decisions is also deemed
necessary. Successful Cardava production by farmer-clients will create sustainable market for
nurseries. In recognition of farmers inherent inclination to trust o e o pee s a ou ts of lesso s
learned, cross-trainings and exchange visits among nurseries and laboratories should be promoted
to accelerate dissemination of good practices and its adoption. Media may also be tapped to assist in
the dissemination of emerging good practices and success stories.
2. Strengthen supply and demand for certified/accredited organic fertilizer parallel to promoting
proper fertilizer management and application
Studies show that continuous cultivation using low external inputs decreases soil fertility and crop
yields. A combination of mineral and organic fertilizers is necessary to sustain and improve crop
production on depleted soils. Fertilizer use can improve banana production but recommendations
should be site-spe ifi a d should add ess e isti g ut ie t defi ie ies i fa e s fields.
It is, therefore, proposed that program supports the development of a vibrant market for organic
fertilizer, which is 50% to 75% cheaper than chemical inputs. Likewise, there is a need to provide
farmers with access to services to guide them in proper fertilizer management and application to
boost productivity parallel to improving profitability. Specific interventions under this strategy
would consist of the following:
(1) Set-up of community-based organic fertilizer plant and/or upgrading and scaling up of existing
fertilizer enterprises including assistance to get the necessary certification/ accreditation.
Establishment of community-based plant for technological inputs will reduce dependence on
expensive external inputs and facilitate shift towards sustainable, regenerative production
systems. This will also contribute to employment generation and solid waste management.
Aside from assistance in setting up the necessary infrastructure, capacity building support
should also be geared towards helping enterprises produce fertilizer (from agri-waste materials
such as banana peels, trunks, coco husk, etc.) that match agro-ecological zones and cropping
systems of banana growers in their area parallel to increasing their productivity, production
capacity, and product quality. This will enable fertilizer enterprises to offer consistent and
reliable supply of alternative fertilizer products of better quality and improved effectiveness at
lesser cost, which will result to lower production costs of Cardava. . Training and coaching on
business management and marketing will assist CBPUs to improve its internal infrastructure to
better serve the clients while ensuring its financial viability.
(2) Development of distribution network/ retail network to ensure proximity of supply to farmers
Program may want to explore the viability of utilizing sari-sari stores as among the retail outlets.
Producers may want to explore the viability of distributing these in small affordable packs in line
ith the sa het o ti gi
e talit of s allholde s a d thei ash flo . The s all pa k
app oa h is i te ded to e a le s allholde s to a hie e i emental gains in yield and income
over a few seasons and ultimately graduate to using the required fertilizer application
68
(3) Development of capacity of organic inputs providers and retailers to deliver technical advice to
farmer clients and basic soil test analysis or via partnership with providers of soil analysis
Promotion of fertilizer use must be complemented with extension services to ensure that
fertilizers have the correct formulation to meet local soil needs, are applied in the correct
amount and at the optimal point in the planting cycle, and are used alongside complementary
inputs such as improved planting materials. Without proper application, fertilizer use can
actually decrease profitability by creating a significant added cost without a corresponding
increase in crop yields. As such, in addition to assisting fertilizer producers to scale up their
production capacities, they must also be capacitated to deliver advisory services to their farmer
clients. It may also be possible to integrate soil testing services with fertilizer distribution.
Fertilizer demand must be promoted with an integrated approach to increasing the profitable
use of fertilizer by farmers through extension services, and linking farmers to output markets.
d) Interventions to create effective demand
Demand for fertilizer may be stimulated through the following approaches: i) demo farms
highlighting organic fertilizer use and appropriate crop and soil management; ii) point-of-sale
knowledge transfer; iii) voucher programs (as described under planting materials) or similar
market-based based mechanisms; and iv) tri-media dissemination of emerging good practices
and success stories.
Farming
3. I p o e fa
e s a ess to skills a d esou es that ould e a le the to adopt good

agronomic practices parallel to ensuring that there are sufficient market-based incentives to
facilitate chain wide upgrading
The proposed strategy involves the development and/or strengthening of localized capacity for
learning and innovation through promotion of inter-firm cooperation and support to set-up and/or
strengthening of community-based extension services delivery system. This will facilitate access of
farmers to technology and resources that will enable them to improve their agronomic practices
parallel to improving chances of the latter adopting the practices to their benefit. Technology
transfer will focus on enabling farmers to incrementally shift to production systems aligned to
principles of GAP and sustainable farming. This will address o
u ities eed fo i eased fa
productivity, reduced production risk, maximized use of land or better resource allocation, and
enhanced diversity and ecological balance. GAP adoption will also facilitate improved compliance to
food safety which has become a primordial factor of quality and competitiveness both for domestic
and export markets. Likewise, it will contribute to streamlining social and environmental
sustainability in Cardava production.
The following are the key interventions under this strategy:
a) Formation of farmer training groups or learning clusters organized around consolidators (e.g.,
cooperatives, assemblers) or lead firms (banana chips processors).
This will involve the organization of interested farmers into farmer training groups. Each group will
have lead farmers selected based on interest, experience, and leadership qualities. Lead farmers will
receive in-depth training on GAP and may be compensated with the produce from the project
supported demonstration farms. The lead farmers will provide training to peers with lead firms or
consolidators providing the marketing perspectives and market assurance.
69
Upgrading is a collaborative undertaking among all participants in a chain. Establishing clear

standards and goals that are communicated on a regular basis is critical to successful upgrading. As
such, the participation of farmers and their buyers in the upgrading process is important. Based on
experiences also, farmers are more receptive to new practices and technology when lead firms or
buyers are involved in the upgrading process. It gives them some confidence that upgrading will
result to tangible benefits.
b) Development of lead farmer-trainers per cluster including delivery and financial sustainability
schemes
This is aimed at complementing the extension services provided by ATI, LGUs, and input suppliers.
Diversity of extension provision, from government extension officers to community-based and value
chain-based providers, will give farmers greater choice of sources of information, knowledge, and
skills to support the long-term sustainability of their farm enterprise,
An influential core group of farmer-trainers can be leveraged to involve their peers and make that
one small shift that produces widespread change. Aside from providing training services, the
members of this core group can become role models and help to reduce uncertainty about a new
idea by adopting it, and then conveying a subjective evaluation of the innovation to peers.
To avoid volunteerism fatigue, it is crucial to develop financial sustainability schemes. Community
trainers can, perhaps, be given a commission from sales of bananas of the group he/she is working
with or a share in the sales from demonstration farms.
c) Harmonization of pricing structure based on standards and improvement of supply chain
governance
Many (mis)trust issues stem from varying interpretations and uneven implementation of standards
and price structure. Harmonization of interpretation of standards and reflecting these in the price
structure will provide incentives for upgrading.
Effectiveness of collaboration among and between value chain players and their consequent
collective adherence to standards depend to a great extent on whether they view themselves as
having shared goals and mutual interests. Therefore, it may be necessary also for PRDP to provide
organizational development support as well as conduct social marketing campaigns. However, the
best trigger for tighter collaboration and cooperation is the pursuit of bigger markets and better
prices.
d) Interventions to stimulate adoption of GAP/sustainable farming practices
To begin a dialogue about upgrading, there is need to first identify issues that participants could
readily connect with. By linking the benefits of upg adi g to fa e s p io it issues a d de elopi g
an understanding of the impacts each actor could have on the whole value chain, there is a high
probability that participants at different points on the value chain can be encouraged and motivated
to wo k togethe . At the ti e of the field o k up to the takeholde s Co sultatio , for example, a
key issue among farmers was the high incidence of pests and diseases during the recent years. It
may be difficult for value chain actors to see how an abstract o ept su h as good p a ti es ill
result in tangible benefits to them. Using an incremental approach, PRDP can start with those
improvements that address the most pressing needs of producers, buyers, and traders.
70
It is recommended to employ participatory learning methods, such as demonstration plots and

hands-on training, to build knowledge of less well-understood areas, such as pest control. Conduct
of friendly competition is also a way to make learning and upgrading fun. The contests can provide
incentives to farmers to become aligned with GAP, while simultaneously demonstrating the effects
of good practices. Good practices and innovative solutions that will emerge from the competitions
can be incorporated into the GAP manual and training modules, helping capture and further
disse i ate e lea i g. The o petitio s a e also a a to ui kl
o ito fa e s
understanding of different elements of GAP and take corrective action whenever necessary.
It is also suggested to involve media in the dissemination of technical and market information, as
well as in highlighting successful initiatives and innovations. Disseminating information in a variety
of waysprint materials, in-person events, competitions, and main-stream mediaensures that as
many value chain actors as possible can hear and understand the messages.
Processing
4. Improve capacity of enterprises to comply with GMP

This will involve the set-up of GMP/HACCP compliant toll processing facility or upgrading of existing
facilities for production of banana chips and similar products. This can also serve as an incubator/R
and D laboratory for promising Cardava-based products.
athe tha de elopi g a si gle o e size fits all p o ide ", the p oje t can work with a range of
providers in order to be able to match competencies and structures of different groups of players at
various links in the chain. Providers of food safety related services may consist of progressive
farmers, traders and leaders in communities, graduating food technology students, government
technicians, and food technologists. It is important that the development of modules is done in
coordination with key VC players especially buyers to ensure integration of market standards and
requirements.
Snack Food/Street Food Vendors
Although this supply chain is dominated by players from poor communities, a significant volume of
Cardava produced by smallholders is marketed through this supply chain. PRDP may want to explore
the viability of a GMP compliant common service facility/community food kitchen to serve as
commissaries for healthy and nutrient dense Cardava-based meals and snacks. This will address
concerns on food safety, nutrition, and sustainable production. Providing an environment conducive
to hygienic and eco-friendly preparation and sale of food will catalyze uptake of good practices,
improve productivity and overall perception of street food.
Parallel to this, PRDP can develop a pool of GMP trainors consisting of progressive vendors. There is
also a need to support the development and downloading of commercially viable Cardava recipes to
the informal food service industry to stimulate growth in demand and improve profit margins.
This may be supported with the development and promotion of hygienic snack food carts under a
rent-to-own scheme or similar mechanism. Care, however, must be given that interventions do not
displace existing vendors.
71
Marketing
5. Development and/or upgrading of marketing infrastructure for all types of banana to enhance
collective marketing and bulk storage
This strategy involves the establishment of a GMP compliant packing house cum trading center
supported with extension services on good postharvest practices. For packing house and trading
center to be commercially viable, it is important that area has the volume that is sufficiently
attractive to lead firms and consolidators. A basic prerequisite is for farmers to be willing to
collectively market their produce. As such, interventions will also include organizational
development and the promotion of win- i
elatio ships et ee fa e s g oups a d
consolidators or lead firms.
A GMP compliant packing house cum trading center equipped with an appropriate level and scale of
post-harvest technology can play a pivotal role in providing a clean environment for the proper
washing, sorting, grading, packaging, and storage of bananas. It is a critical and important
component of the infrastructural base to support value adding and quality and safety management
in fresh banana supply chains. Presence of packing houses cum collection centers within the
proximity of Cardava production areas will also reduce hauling and transport costs of farmers.
6. Upgrading of existing processed products and development of related products that Mindanao
can sustain as a marketing proposal in the domestic market with a view of laying the
groundwork for export sales
It is suggested that PRDP supports the product and market development of Cardava-based food
products targeting the healthy food sector. Product research and development are important
aspects of the processed snack food industry given increased competition with the entry of more
players and the influx of imported brands. The big players in the snack food industry have their own
research and development teams to come-up with new and interesting products in better and
attractive packaging to attract a wider range of consumers.
In addition to the pasalubong market, a potential niche for the Cardava-based food products is the
healthy gourmet markets. An emerging trend in the snack industry is to make classic favorites more
appealing to the health conscious. To cash in on the healthy food trend, food manufactures have to
make adjustments to their formulas by using ingredients that are all-natural or organic, low in
calories, no preservatives and chemical additives, etc. The healthy positioning has also to be
reflected in the packaging (e.g., eco-friendly materials) and in the whole operations. The major
challenge and opportunity for Northern Mindanao enterprises is to combine tradition, health, and
convenience into high quality new food solutions produced efficiently.
Possible directions that the processed Cardava subsector can pursue:
a) Development of all natural healthy snack food. Aside from formulation of healthy delicious
recipes, this also implies using ingredients that are all natural (e.g., naturally farmed eggs,
muscovado or other healthy sugar, low-fat milk from organically raised cattle, etc.).
b) Mo i g a a f o the o e size fits all o ept of p odu tio a d fo us o the tastes a d
recipes that appeal to different demographics (e.g., infants, elderly, Halal food products, etc.)
c) Premium quality flour for gluten free applications
72
Marketing support ranging from trade fair participation, selling missions, brochures, etc. should be
uilt a ou d the ag eed i age a d p odu t diffe e tiatio fa to s. This a also se e as a
incentive for producers to upgrade their products and processes in order to be a part of the
marketing campaign.
7. Construction and/or upgrading of farm to market roads

Farm-to-market road rehabilitation or construction will help farmer to access markets and vital
services. Improvements of rural infrastructure can reduce transportation and labor costs and, more
generally, the cost of transaction. Shorter travel time and good road conditions will minimize risks of
product deterioration. The overall reduction of transaction costs will contribute to improving price
competitiveness and/or better profit margins that can help farmers cope with price fluctuations.
Public investments in road infrastructure can potentially stimulate agribusiness investment, vertical
coordination with buyers, and inclusion of small farmers in remote areas.
73
Table 22.- Summary of Constraints/Opportunities and Interventions

Constraints/Opportunity
Province
Intervention Strategy and Approach
Who Can Do It?

Public
Private
INPUT PROVISION
Limited supply of good quality
disease free planting materials/
Lack
of
tissue
culture
laboratories
ZAMBOANGA PENINSULA
Zamboanga del Norte (1 to 6)
Zamboanga del Sur (2 to 6)
Zamboanga Sibugay (2 to 6)
Zamboanga City (2 to 6)
Low willingness among farmers

to invest in good quality
planting materials
NORTHERN MINDANAO
Bukidnon (1 to 6)
Camiguin (2 to 6)
Lanao del Norte (1 to 6)
Misamis Occidental (2 to 6)
Misamis Oriental (2 to 6)
Opportunities
Use of tissue cultured planting
materials can significantly
improve yield of farmers
Village level nurseries can
potentially reduce cost of tissue
cultured planting materials and
provide additional income to
farmers
DAVAO REGION
Davao del Norte (1 to 6)
Davao del Sur (1 to 6)
Davao Oriental (1 to 6)
Compostela Valley (1 to 6)
Davao City (1 to 6)
SOCCSKSARGEN
North Cotabato (1 to 6)
Sarangani (2 to 6)
South Cotabato (2 to 6)
Sultan Kudarat (2 to 6)
CARAGA
(1 to 6)
Agusan del Sur (2 to 6)
Surigao del Norte (2 to 6)
Surigao del Sur (2 to 6)
Strengthen local capacity to commercially DA/PRDP

Cooperatives
produce and distribute high yielding and - Technical
and - Management and
disease resistant planting materials
financial support
operations
of
nurseries
(1) Establishment and/or upgrading of BPI/DOST/ HVCDP
existing tissue culture laboratories
- Technical assistance
- R and D
(2) Establishment of community-based
nurseries
PLGU/MLGU
- Coordination
(3) Implementation of voucher program - Monitoring
or similar mechanisms to encourage - Follow-through
farmers to use clean planting materials
extension services
of the high yielding varieties.
- Organizational
Development
(4) Development of capacity of nursery - Management and
operators to provide technical advice
operations of tissue
culture laboratories
(5) Support the establishment and/or
upgrading of seed banks.
Existing tissue culture
laboratories
(6) Documentation and dissemination of - Mentoring
and
emerging good practices
technical guidance
Pgina 74

Province
Who Can Do It?

Public
Private
ARMM
Basilan (2 to 6)
Lanao del Sur (2 to 6)
Maguindanao (1 to 6)
Sulu (2 to 6)
Tawi-tawi (2 to 6)
High cost of chemical inputs

Limited
availability
and
commercial distribution of
organic fertilizer and inputs
Lack of understanding among
farmers on cost benefits of
proper and efficient use of
fertilizer/Only very few farmers
apply fertilizer
Low level of purchasing power
among smallholders
Opportunities
Proper
application
and
management of fertilizer and
pesticides together with use of
quality planting materials and
good agronomic practices can
potentially result to yield of 50
ZAMBOANGA PENINSULA
NORTHERN MINDANAO
Bukidnon (1 to 5)
Camiguin (2 to 5)
DAVAO REGION
Davao City (1 to 5
SOCCSKSARGEN
Sarangani (2 to 5)
CARAGA
(1 to 5)
Strengthen supply and demand for DA/PRDP

certified/accredited organic fertilizer - Technical
and
parallel to promoting proper fertilizer
financial support
management and application
ATI
(1) Set-up of community-based organic - Training
and
fertilizer plant and/or upgrading and
technical assistance
scaling up of existing fertilizer
enterprises including assistance to get PLGU/MLGU
the
necessary
certification/ - Organizational
accreditation
development
- Follow
through
(2) Implementation of voucher program
extension services
or similar tool to stimulate purchase - Organization
of
and use of organic fertilizer/inputs and
training and similar
reduce risk averseness among farmers
activities
- Coordination
of
(3) Set-up of demo farms to showcase
voucher program or
benefits and venue for learning
similar mechanism
Cooperatives
- Management
and operations
of
fertilizer
business
- Promotional
campaign
(4) Development of distribution network/

retail network to ensure proximity of
supply to farmers
Pgina 75

Province
Who Can Do It?

Public
to 80 kilos per bunch

Agri-waste can be used in the
production of organic fertilizer.
There
are
also
existing
enterprises
engaged
in
production of organic fertilizer
but not specifically for banana

ARMM
Basilan (2 to 5)
Lanao del Sur (2 to 5
Sulu (2 to 5)
Tawi-tawi (2 to 5)
(5) Develop capacity of organic inputs

providers and retailers to deliver
technical advice to farmer clients and
basic soil test analysis or via
partnership with providers of soil
analysis
ZAMBOANGA PENINSULA
Zamboanga Sibugay 1 to 6)
I p o e fa e s a ess to skills a d DA/PRDP

resources that would enable them to - Technical
and
adopt good agronomic practices parallel
financial support
to ensuring that there are sufficient
market-based incentives to facilitate chain ATI
wide upgrading
- Training/ technical
assistance
(1) Formation of farmer training groups or - Support
to
learning clusters organized around
certification
consolidators
HVCDP
(2) Development of lead farmer trainers - Training/ technical
per cluster including delivery and
assistance
financial sustainability schemes
BAFPS
(3) Participatory development
(with - Technical
farmers,
multinational/
agents,
assistance
traders) of modules on sustainable - Development
of
farming practices to ensure buy-in and
low-cost measures
Private
FARMING
Limited outreach of existing
extension services
Cardava traditionally grown
with minimal investments on
farm maintenance and inputs
Low uptake and adoption of
Good Agricultural Practices
Opportunities
Upgrading of low cost
indigenous technologies that
have good potentials of
improving farm productivity
There are progressive farmers
NORTHERN MINDANAO
Bukidnon (1 to 6)
Camiguin (1 to 6)
DAVAO REGION
Davao City (1 to 6)
SOCCSKSARGEN
Sarangani (1 to 6)
Cooperatives
- Base of delivery
of services
- Management of
demo farms
Pgina 76

Province
Who Can Do It?

Public
in Lanao del Norte, North

Cotabato, and Davao Region
especially Davao del Sur who
have been trained in GAP and
are willing to share best
practices with peers
Interest among cooperatives
and traders to increase
volume/ yields to get premium
prices (traders pay higher
prices if farmers/groups deliver
significant volume)
CARAGA
(1 to 6)
ARMM
Basilan (1 to 6
Lanao del Sur (1 to 6)
Sulu (1 to 6)
Tawi-tawi (1 to 6)
ownership of stakeholders and

conformance to market requirements
including technical assistance in the
development of training approaches
that allow quick wins to motivate and
sustain adoption
(4) Conduct of competitions to motivate
adoption, stimulate innovation, and
facilitate identification of emerging
good practices as basis for regular
updating of modules
(5) Dissemination
practices
of
emerging
to comply
certification
Private
with
PLGU/MLGU
- Organizational
development
- Follow
through
extension services
- Organization
of
activities
- Support certification
good
(6) Harmonization of pricing structure

based on standards and improvement
of supply chain governance
PROCESSING
Lack of access to skills and
resources to comply with GMP
(especially micro enterprises)
ZAMBOANGA PENINSULA
Zamboanga City (1 and 2)
Opportunity
NORTHERN MINDANAO
Bukidnon (1 and 2)
Misamis Oriental (1 and 2)
Implementation and adoption

of standards such as GMP and
DAVAO REGION
Davao del Sur (1 and 2)
Davao City (1 and 2)
Improve capacity of enterprises to comply

with GMP
DA/PRDP
- Technical
and
financial support
(1) Set-up of GMP/HACCP compliant toll

processing facility and/or upgrading DOST/DTI
support to cooperatives currently - GMP
Training/
engaged in banana processing
technical assistance
- Product
Cooperatives
- Base of delivery
of services
- Management of
Common
Services Facilities
Pgina 77

Province
Who Can Do It?

Public
HACCP and other relevant

quality standards can play a
positive role in providing the
catalyst and incentives for the
modernization of the banana
chips industry and the adoption
of safer and more sustainable
production and processing
activities which can be
differentiation factors that can
institutionalize
market
competitiveness
Davao del Norte (1 and 2)

Davao Oriental (1 and 2)
SOCCSKSARGEN
North Cotabato (1 and 2)
Sarangani (1 and 2)
(2) Development of a core group of local

experts to provide hands-on training
and mentoring to CSF users
Private
Development
Technical Assistance
PLGU/MLGU
- Organizational
development
- Follow
through
extension services
- Organization
of
activities
CARAGA
(1 and 2)
ATMM
Maguindanao (1 and 2)
MARKETING
Poor postharvest handling and
facilities especially among
buying stations resulting to
high levels of losses
ZAMBOANGA PENINSULA
Opportunities
NORTHERN MINDANAO
Bukidnon (1 to 3)
Misamis Oriental(1 to 3)
Camiguin (1 to 3)
The shelf-life of bananas can be

prolonged by proper storage
and postharvest handling
DAVAO REGION
Development and/or upgrading of

marketing infrastructure to enhance
DA/PRDP
- Technical
and
financial support
(1) Foster linkages between

farmer
groups and exporters/processors
including the development of
business models and its piloting
PhilMech
- Technology transfer
- Customization
of
equipment/
- facilities to fit in
with terrain and
requirements
of
area
(2) Establishment and/or upgrading of

buying stations (collection point,
sorting, storage) for all types of
banana
(3) Set-up of pool of mentors to provide
Cooperatives
- Management and
operations
of
common service
facilities
PLGU/MLGU
- Follow
through
Pgina 78

Province
Who Can Do It?

Public
Davao City (1 to 3)
SOCCSKSARGEN
Sarangani (1 to 3)
training on good postharvest

practices and to foster an
entrepreneurial mind set
assistance
- Organizational
development
ATI/DTI
- Enterprise
training
CARAGA
(1 to 3)
Private
dev
ARMM
Weak demand for banana chips

in local market
ZAMBOANGA PENINSULA
Zamboanga del Sur (1 and 2)
Zamboanga City (1 and 2)
Lack of product differentiation/

available product formats
NORTHERN MINDANAO
Bukidnon (1 and 2)
Misamis Oriental (1 and 2)
Opportunity
The very large population in the
Philippines and increasing
consciousness for healthy snack
food provides opportunities to
develop the local market for
other processed Cardava based
products
DAVAO REGION
Davao del Sur (1 and 2)
Davao City (1 and 2)
SOCCSKSARGEN
North Cotabato (1 and 2)
Sarangani (1 and 2)
CARAGA
(1 and 2)
Upgrading of existing processed products DA/PRDP

and development of related products that - Technical
and
Mindanao can sustain as a marketing
financial support
proposal in the domestic market with a
view of laying the groundwork for export DOST/DTI
sales
- Product
(existing, banana chips)
Development
(1) Process and product development
Technical Assistance
support targeting healthy snack food - Market
and halal markets
Development
(2) Brand and
campaign
market
Cooperatives
- Management of
Collective
Enterprises
development
PLGU/MLGU
- Organizational
development
- Follow
through
Pgina 79

Province
Who Can Do It?

Public
ARMM
Maguindanao (1 and 2)
Basilan, Sulu, Tawi-tawi /1 and 2)
Poor farm to market roads
All provinces except Basilan, Sulu

and Tawi-tawi
Private
extension services
- Organization
of
activities
Construction and/or upgrading of farm to
market roads
Opportunity
LGU willing to cost share in the
construction and maintenance
of farm to market roads.
Pgina 80
Section :
CONCLUSIONS AND RECOMMENDATIONS
1. Strengthening the processed banana (chip and IQF) and fresh market (home consumption and
snack food) supply chains will help stabilize the incomes of participants in the chains, particularly
farmers, and provide the latter with diversified markets for their produce. The upgrading
strategy should involve moving farmers and supply chains into progressively higher-value
markets in small steps, with specific attention to product, process, and functional upgrading.
Main thrusts of the interventions should focus on the following competitiveness issues:
a) Reliability and predictability of supply
b) Productivity and efficiency improvements from farm to distribution
c) Improvement of capacity and capability to comply with quality and food safety standards
d) Reduction of postharvest losses
e) Product differentiation and diversification (organic/all natural healthy food products, Halal
food products, low-cost safe and healthy snacks, etc.)
f)
Functional upgrading (farmers taking up additional functions such as nursery operations,

organic fertilizer production and distribution, collective marketing, processing, etc.)
2. The huge demand for halal food products in the world market is an opportunity that ARMM can
potentially anchor its development directions for the next coming years. Commercial production
and distribution of Halal processed Cardava snack foods may be among the product
opportunities that the region can explore.
3. The typical response to bridge the demand supply gap has been to increase the area under
Cardava cultivation but yield (productivity) has remained low in many areas in Mindanao. This
has led to higher production cost. Increasing area under Cardava cultivation is not sustainable
more so with the growing scarcity of fertile lands. A more sustainable approach would be to
promote yield intensification through improved productivity. Farmers in Davao del Sur and
North Cotabato have shown the yields as high as 40 MT per hectare is possible.
Pgina 81
ANNEX :
PRIORITIZATION OF INTERVENTION STRATEGY:
ZAMBOANGA PENINSULA
Ranking and Prioritization of intervention Strategy per Province
Ranking and Prioritization: Zamboanga Peninsula
Intervention Strategy
ZDN
ZDS
Sibugay
ZC
Strengthen local capacity to commercially

produce and distribute high yielding and
Strengthen supply and demand for

certified/accredited organic fertilizer
I p o e fa e s a ess to skills a d
resources that would enable them to adopt
good agronomic practices parallel to
ensuring that there are sufficient marketbased incentives to facilitate chain wide
upgrading

with GMP

Upgrading of existing processed products

and development of related products that
view of laying the groundwork for export
sales

market roads
Pgina 82
ANNEX :
NORTHERN MINDANAO
Ranking and Prioritization: Northern Mindanao

Mis Or
Lanao
Bukidnon
Mis Occ
Camiguin


resources that would enable them to
market-based incentives to facilitate chain
wide upgrading

with GMP


sales

market roads
Pgina 83
ANNEX :
DAVAO REGION
Ranking and Prioritization: Davao Region
Davao del
Norte
Davao del
Sur
Davao City
Davao
Oriental
Compostela


market-based incentives to facilitate chain
wide upgrading

with GMP


sales

market roads
Pgina 84
ANNEX :
SOCCSKSARGEN
Ranking and Prioritization: SOCCSKSARGEN
South
Cotabato
North
Cotabato
Sarangani
Sultan
Kudarat


I p o e fa e s access to skills and

upgrading

with GMP


sales

market roads
Pgina 85
ANNEX :
CARAGA
Ranking and Prioritization: Caraga
Agusan del
Norte/
Butuan
City
Agusan del
Sur
Surigao del
Norte
Surigao del
Sur


upgrading

with GMP


sales

market roads
Pgina 86
ANNEX :
ARMM
Ranking and Prioritization: ARMM
Lanao del
Sur
Basilan
Maguindanao
Tawi-Tawi


market-based incentives to facilitate
chain wide upgrading

with GMP


sales

market roads
Pgina 87

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PHILIPPINE RURAL

VALUE CHAIN ANALYSIS AND

Background Information and Objectives

Methodology and Approach

Section 2: OVERVIEW OF THE INDUSTRY

Section 3: NATURE AND STRUCTURE OF INDUSTRY

Value Chain Mapping

Key Players and Function

Nature of Interfirm Relationship

Price and Cost Structure

Section 4: MARKETS AND MARKET OPPORTUNITIES

Markets and Market Trends

Section 5: SUPPORT SERVICES

Section 6: ENABLING ENVIRONMENT

Formal Rules, Regulations, and Policies

Informal Rules and Socio-Cultural Norms

Section 7: CONSTRAINTS AND OPPORTUNITIES

Section 8: COMPETITIVENESS DIRECTIONS

Priority Constraints/Opportunities and Interventions

Section 9: CONCLUSIONS AND RECOMMENDATIONS

Annex 1, 2, 3, 4, 5, AND 6: PRIORITIZATION OF INTERVENTION STRATEGY PER

MB/II.- CARDAVA VCA STUDY, DA-PRDP- MINDANAO CLUSTER

Key Cardava Products Traded in Mindanao

World production of Banana, 2009 and 2013

Breakdown of Banana Production (In MT) by Genotypes: 2010

Cardava Production in the Philippines by Region ranked according to Volume,

Top Ten Cardava Producing Provinces in the Philippines, 2013

Cardava Production Trends in Zamboanga Peninsula, 2009 to 2013

Cardava Production Trends in Northern Mindanao, 2009 to 2013

Cardava Production Trends in Davao Region, 2009 to 2013

Cardava Production Trends in SOCCSKSARGEN, 2009 to 2013

Cardava Production Trends in CARAGA, 2009 to 2013

Cardava Production Trends in ARMM, 2009 to 2013

Banana Chips Exporters in Mindanao

First Fry Facilities and Subcontractors in Mindanao

Indicative Costs and Return for 1 hectare of Cardava Banana

Relative Financial Position of VC Players: 1 kilo of fresh banana

Relative Financial Position of VC Players: 1 kilo of banana chips

Volume and Value of Banana Chips Exports, 2007 to 2011

Size Classification of Cardava Banana

Banana Shipments from Mindanao, 2009

Farm Gate Price of Cardava in Mindanao Regions, 2009 to 2013

Constraints and Opportunities

Summary of Constraints/Opportunities and Interventions

MB/II.- CARDAVA VCA STUDY, DA-PRDP- MINDANAO CLUSTER

USES AND BY-PRODUCTS OF CARDAVA BANANA

BANANA GENOTYPES AND CONSUMPTION GROUPS

PERCENTAGE BREAKDOWN OF BANANA PRODUCTION IN THE PHILIPPINES

BREAKDOWN OF BANANA PRODUCTION IN THE PHILIPPINES BY ISLAND

PERCENTAGE BREAKDOWN OF BANANA PRODUCTION IN MINDANAO

VALUE CHAIN MAP FOR FRESH CARDAVA FOR RETAIL MARKETS

FLOW OF CARDAVA FROM MINDANAO TO KEY URBAN CENTERS

TYPICAL MODE OF DELIVERY TO BUYING STATIONS IN MINDANAO

VALUE CHAIN MAP FOR PROCESSED BANANA

COLLECTION OF CARDAVA FROM BUYING STATION IN MAGUINDANAO FOR

FLOW OF CARDAVA TO PROCESSOR-EXPORTERS

VALUE CHAIN MAP FOR CARDAVA SNACK FOOD

BANANA CUE VENDOR BUYING CARDAVA FROM A PROCESSING PLANT

GEOGRAPHIC FLOW OF CARDAVA

PHILGAP CERTIFIED CARDAVA FARM IN DAVAO DEL SUR

EXAMPLE OF A WELL-MAINTAINED CARDAVA FARM IN DAVAO DEL SUR

TYPICAL BUYING STATIONS IN MINDANAO

CARDAVA REJECTS AT BUYING STATION

KEY PROCESSES IN BANANA CHIPS PRODUCTION