AN EXPANDED INVESTMENT PLAN ON BOOSTING COCONUT INDUSTRY CLUSTER AND EMPOWER

COCONUT FARMERS THROUGH SUSTAINABLE PARTNERSHIP WITH THE LEADING COCONUT

PROCESSORS IN LEYTE

I. RATIONALE AND OBJECTIVES

The coconut expansion plan under the approved Detailed Investment Plan of the Provincial
Coordination Unit of Leyte is proposed to extend the assistance and interventions to more coconut
farmers and other stakeholders in the province. Currently, the approved investment plan caters to
2,242 farmes equivalent to 42% of the provincial target and 50% of the regional target as specified in
the National Economic and Development Authority (NEDA) RAPID Growth Project Logical Framework.
These figures are represented by coconut farmer associations who will sell 80% of their whole nuts to
KAMMPIL Agricoop as stipulated in the Commercial Partnership Agreement (CPA) signed by both
parties. Subsequently, the coop will serve as consolidator and processor of Desiccated Coconut to be
forwarded to SC Global Coco Products, Inc., for further processing (VCO) and delivery to export
market.

Beside Desiccated Coconut, the most prominent coconut value adding activity performed by the
farmers in the province is Copra production due to its year round demand and accessibility of buying
stations and traders in the municipal or barangay level. In the 2022 Philippine Coconut Authority VIII
List of Registered Copra Traders, 56 are located in the province of Leyte, 44 of which are in the 2nd
district of Leyte. This data further support the accessibility of copra market for the farmers. Hence,
the invariable copra production of the coconut farmers to sustain their day to day living expense.

With the Rural Agro-Enterprise Partnership for Inclusive Development (RAPID) Growth Project, this
investment plan aims to expand the reach of coconut farmers assisted direct or indirect by identifying
a sub-sector participated by most farmers and increase the income of our smallholder men and
women coconut farmers through the provision of sustainable income-generating agribusinesses. In
addition, this investment plan aims to develop and strengthen the coconut industry in the province in
order to serve the market with products that meet their quality and volume requirement.

This investment plan specifically aims to:

1. Increase income of 3,000 farmers stakeholders to 60% at the end of the project by
improved copra quality through productive investment, matching grants and access to
financial services.
2. Increase the trading volume of farmers association and MSMEs by 100%
3. Address the issues on price fluctuations through increased trading volume of copra
(contract and deposit-scheme of oil millers)
4. Strengthen capability and gender sensitivity of men and women farmers by providing tailor-
fitted business development services.
5. Improve resiliency through adoption of environmentally sustainable, climate resilient
technologies and practices.
6. Generate 2,500 incremental jobs by end of the project

During the project stakeholders profiling and firm level consultations, there were three (3) pre
identified MSMEs from the first approved DIP that would still be included in the model as forward
linkage and the forty four (44) municipal-based Copra Traders in District 2 as alternate. Meanwhile,
there are six farmer organizations, two (2) association and four (4) cooperative to participate in the
project, with a total membership of 1,650 farmers and sex aggregated data of 803 Males and 856
Female and a consolidated total land holding of 841 Has. (Table 1. Investment Plan Value Chain
Actors)

The target value chain actors of this investment plan include the following association and
cooperative:
Table 1. Investment Plan Value Chain Actors
Name of Organization Number of Members Value Chain Products Address
Total Male Female Function

1. SC Global Inc - - - Processor Brgy. Caridad,

Baybay, Leyte

2. Tacloban Oil Mills (TOMI) - - - Processor Brgy. Opong,

Tolosa, Leyte

3. KAMMPIL Agricoop - - - Processor Jaro, Leyte

4. Local Copra Traders in D2 44 20 24 Trader District 2 Leyte

5. Amahit Coconut farmer’s 82 25 57 Processor Copra Brgy. Barugo,

Multipurpose Cooperative Leyte
6. Binibihan Agriculture 80 28 52 Processor Copra and Brgy. Binibihan,
Cooperative Wholenuts Carigara, Leyte

7. Brgy. Esperanza Organic 31 10 21 Processor Copra and Brgy. Esperanza,

Farmers Association VCO Burauen, Leyte
8. Macalpi Community 76 15 61 Processor Copra and Brgy. Macalpi,
Multipurpose Cooperative Wholenuts Carigara, Leyte

9. Brgy. San Francisco West 46 35 11 Producer Wholenuts Alangalang, Leyte

Farmers Association
10. Agricultural Small Coconut 1300 670 630 Processor Copra and Lapaz, Leyte
Farmers Federation- Lapaz Wholenuts
TOTAL 1,659 803 856
The aggregate production capacity of these associations/ cooperative/ individual farmers total to
2,161.66 MT of nuts. Table 3 Summary of Annual Production Capacity of FOs.

II. Investment Scope and Market Development Approach

In the expanded investment plan, the scope will cover District 2 of Leyte, with the municipalities listed
as follows: Alangalang, Barugo, Jaro, Carigara, Lapaz and Burauen. These municipalities have
organized farmer associations and cooperatives that are engaged in Copra production. Additionally,
these municipalities are neighboring KAMMPIL Agricoop located in Brgy. Daro, Jaro, the coop also
processes copra and can function as buyer/ consolidator. For the market development approach,
farmer Organizations will collect and consolidate copra from their members. Forward linkage or
anchor firm will be TOMI. This proposed focus location is for the purpose of strengthening the
network of coconut farmers/ processors in the area in support of the business development model of
the proposed expanded investment Plan. (Figure 1)

To accomplish the end goal of increasing the income of our smallholder farmers, this plan will be
implemented focusing on the business development services specifically in the areas of productivity,
product development and product optimization ensuring that daily volume and quality requirements
of the anchor firm (TOMI) will be conformed. Training and Capacity development activities will be
spearheaded by specialists from the National Coconut Research Center Visayas (NCRC-V). Indicative
list of BDS are but not limited to Capacity on 1. Design and Development of a Low Cost Semi Direct
Type Copra Dryer 2. Optimization of Copra Products using direct and indirect dryer. (List of BDS listed
in Form 1). Thus, the plan aims to invest on the following actors:
SC Global Coco Products Inc.

SC Global Coco Products, Inc. is based in Baybay, Leyte. The company manufactures organic coconut-
based products such as Crude Oil, Bleached and deodorized Oils, Cooking oil, Flours, Shortenings and
Copra. Their current monthly production capacity is approximately 12,300 MT of wet coconut-based
products (coconut oil, cooking oil, virgin coconut oil and unsaturated fat distillate). Meanwhile, 1,100
MT of dry products such as coconut flour and coconut shortening and 3300 MT of copra. Further,
moisture acceptability is at 8-10%. The company are have the the following certifications: Organic,
Halal, GMP,Kosher, BRC and Fairtrade. These certifications are essential for their export market listed
as follows: USA, Korea, Germany, Netherlands, Australia and Malaysia

Tacloban Oil Mills (TOMI)

Tacloban Oil Mills Inc. (TOMI) located at Brgy. Opong, Tolosa, Leyte produces crude coconut oil. The
company buys copra from farmers and consolidators from Eastern Samar, Leyte and Southern Leyte
provinces. With more than 100 personnel including the administrative staff, TOMI normally processes
300 MT of copra daily, producing 60 MT of coconut oil with copra cake as the by-product. In buying
copra, TOMI considers 8% and below moisture content as good quality copra.

Most of the finished products for the first half are traded locally and the second half production is for
foreign trading. TOMI’s foreign buyer includes US-based company Procter and Gamble. Most of their
local buyers are located in Luzon with a demand of more or less 1000 MT of oil and a highest recorded
order of 3000 MT.

Local MSME Traders

The local traders will serve as alternate market for the Farmer Organizations. In the whole of District 2
of the province of Leyte, there are a total of 44 copra traders registered in their respective municipal
business permits and licensing office (BPLO). These copra traders are nearest to the FOs. Their
operation involves processing, consolidating and trading of copra and then delivery to TOMI.

COCONUT AND COPRA PRODUCTION

KAMMPIL Agricoop

The Kalipunan ng Maliliit na Magniniyog ng Pilipinas Agriculture Cooperative (KAMMPIL AgriCoop ) is

the recipient of the matching grant from the already approved Leyte coconut detailed investment
plan amounting to Php 1,500,000 for productive investments intended to expand their desiccated
coconut production. Alongside desiccated coconut, the agricoop produces pared copra, coconut sap
vinegar, coco coir fiber and other products from its by-product. For the copra production, their annual
capacity is at 48-MT, with a raw material requirement of 17.14-MT.

With the improved operations and product diversification of the cooperative, more coconut farmer
associations can partner with the cooperative to supply their increasing need for raw material.
KAMMPIL will be the forward linkage of other coconut farmers. With this, raw material requirement
for Copra or whole nuts can potentially be supplied by the San Francisco West Farmer Association in
Alangalang situated in the next town from Jaro, Leyte.

Agricultural and Small Coconut Farmers Federation

Agricultural and Small Coconut Farmer’s Association (ASCFA) is a coconut farmers’ federation
organized to improve small coconut farmers’ livelihood by mobilizing resources and support from
relevant government agencies such as Philippine Coconut Authority (PCA), Department of Agriculture
(DA) and the Local Government Unit (LGU). The federation was registered with the Department of
Labor and Employment (DOLE) in 2018. The federation is currently transitioning into a cooperative.
These farmers are engaged in Copra, VCO, charcoal processing and whole nut trading. The total
active membership of the federation is over 1,300 Coconut Farmers or an average of 1,450 farming
households that covers almost 863.4 hectares of coconut plantation a shown in the table below.

Table 2. Members Association of Agricultural and Small Coconut Farmers Federation

Name of Association Number of members Existing Area of Hectares for
Total Male Female Production (in new plantation
hectares) (in hectares)
1. Brgy. Quiong SCFA 24 16 8 12 7.2
2. Brgy. Sta.Ana SCFA 49 18 31 66.9 14.7
3. Brgy. Tarugan SCFA 60 27 33 37.2 18
4. Brgy. Buracan SCFA 53 30 23 60 38.4
5. Brgy. Mag-Aso SCFA 50 19 31 26.7 6
6. Brgy. Bagacay East SCFA 0
7. Brgy. Limba SCFA 60 41 19 34.6 18
8. Brgy. District 4 SCFA 51 36 15 36 15.3
9. Brgy. Gimenarant East 12.5 7.5
SCFA 25 23 2
10. Brgy. Caltayan SCFA 10 10 5 3
11. Brgy. Luneta SCFA 71 48 23 35.5 21.3
12. Brgy. Cogon SCFA 25 25 12.5 7.5
13. Brgy. Lubi-Lubi SCFA 53 25 28 28.9 15.9
14. Brgy. Piliway SCFA 51 27 24 63.2 15.3
15. Brgy. Pawa SCFA 50 23 27 80.7 15
16. Brgy. Duyog SCFA 55 27 28 48.6 16.5
17. Brgy. Bongtod SCFA 61 25 36 60.9 18.3
18. Brgy. Calahjusan SCFA 50 18 32 6.5 17.4
19. Brgy. Sta. Elena SCFA 25 3 22 12.5 7.5
20. Brgy. Rizal SCFA 40 33 7 10.9 12
21. Brgy. District 1 SCFA 52 16 36 16.7 15.6
22. Brgy. Cacao SCFA 0
23. Brgy. District 3 SCFA 64 38 26 35.1 14
24. Brgy. San Victoray SCFA 55 16 39 27.5 16.5
25. Brgy. Canbanez SCFA 50 25 25 25 15
26. Brgy. Pansud SCFA 29 14 15 14.5 8.7
27. Brgy. Moroboro SCFA 94 49 45 47 28.2
28. Brgy. Caabangan SCFA 35 15 20 17.5 10.5
29. Brgy. Bucawon SCFA 58 58 29 17.4
Total 1,300 670 630 863.4 400.7
Above list is the 2023 updated list of membership. Data for area existing and new plantation was gathered
during the 2021 Stakeholders profiling of the federation.

During firm level consultation it was found out that the federation has an average aggregate copra
production capacity at a rate of 374.82-MT (Table 3) annually and that farmer members are operating
individually selling their copra to barangay level copra traders. Most of the associations excluding
barangay Districts 1-4 are in the outlying areas of Poblacion. Hence, presence of barangay level copra
traders are beneficial for the farmers as it reduce transportation cost. When the federation transitions
to a cooperative this year 2023, the member associations will buy the whole nuts from the association
members and process it to copra to which the federation will become the consolidator. Most of the
farmer members are into whole nut trading due to higher cost of copra production and low farm
productivity. The latter can be attributed by (1) low or lack of knowledge on farm productivity and
good agricultural practices, (2) increasing hectare of senile plantation and (3)presence of strong
typhoons in the area. These problems encountered can be addressed by capacity building training on
Good Agricultural Practices (GAP), Sloping Agricultural land Technology (SALT) and the likes to
enhance knowledge of farmers and improve agricultural practices. Capacity development programs
proposed are in Form 1.
Amahit Coconut Farmers Multipurpose Cooperative

The cooperative is located in Brgy. Amahit, Barugo and was organized in 1992, with active registration
with the Cooperative Development Authority (CDA), Business permit and licensing office (LGU) and
Bureau of Internal Revenue (BIR) up to present. Their total active membership is 82 with sex dis
aggregation of 25 Male and 57 Female. The coop offers lending services and consolidator of their
farmer members’ produce such as tuba or coconut wine and coconut vinegar. These products are
displayed in their DSWD funded Sari-sari store through the Sustainable Livelihood Program (SLP)
amounting to 320, 000 funded in the year 2021. Their other products is copra that is processed
individually by their farmer members. Their annual capacity is at XXX. Copra are sold to Carigara or
Tunga, Leyte. In this investment plan, the cooperative will buy or consolidate the copra of their
members and forward it to Bininihan Agricultural Cooperative (BAC) for faster and accessible market.

Binibihan Agricultural Cooperative

The Binibihan Agriculture Cooperative (BAC) is an organization duly registered with the Cooperative
Development Authority (CDA) in the year 2019 with official address at Brgy. Binibihan, Carigara, Leyte.
The coop have 80 membership. The cooperative offers lending services and engage in vegetable
production, food processing, coconut processing such as VCO, Copra and Charcoal. The cooperative’s
total land holding is 78 hectares planted with coconut inter crop with banana. The cooperative
procure raw materials (whole nuts and coco shells) from their members to produce VCO and charcoal
products. Further, these products are displayed in their Kadiwa ni Ani Trading Store, a Php
270,000.00 project grant by the Department of Agriculture Agribusiness and Marketing Assistance
Division (DA-AMAD). The coop also expanded their business operations by consolidating copra from
their members. Currently the cooperative’s capacity is at 14.4-MT annually. The cooperative only
limits their copra processing and consolidation for the time being until they have a warehouse to
store their copra stock. Their existing facility is only for their food processing and cannot be used as
copra storage. The cooperative can source and consolidate a rate of 40.9-MT of copra annually from
other members and nearby farmer cooperatives and individual farmers when invested with the
proper storage and facilities (Form 1).

Just this year, the cooperative qualified for the provision of financial assistance amounting Php
250,000.00 from CDA under the Coconut Farmers Industry Development Program (CFIDP) for their
facility renovation and procurement of additional equipment.

With the help of DTI-RAPID Growth Project and other partner government agencies, the cooperative
aims to expand the production of copra in order to meet the demand of existing buyers in the
municipal or provincial level.

Brgy. Esperanza Organic Farmers Association

The association covers 35.3 hectares of coconut plantation in Brgy. Esperanza, Burauen, Leyte with 33
active farmer members operating for almost 16 years. The farmers’ group process VCO, Charcoal and
Copra. The group’s copra production capacity is at 20.9 MT annually. On the other hand, during the
last quarter of 2022 the association started their charcoal processing and up to date their current
production is at 10,000 shells per week. The association procure their whole nuts from their members
at a premium rate, processing of their products is performed at their common service facility. The
association operates as a business entity supported by their complete legal identity and registration
from Department of Labor and Employment (DOLE), Local Government Unit (LGU) and Bureau if
Internal Revenue (BIR). Their copra production is scheduled twice a week within a limited volume due
to the current capacity of the coconut dryer at 2,500 nuts per production. It was also observed that
their copra product contains higher moisture and during copra grading, approximately 3-4kg is
deducted from its tare weight. To ensure copra product is within the acceptable moisture content,
value should be between 8-10%. hence, productive investment is proposed to ensure quality and
grade copra products amounting to Php 520,000.00. (Form 1)
Macalpi Community Multipurpose Cooperative

Macalpi Community Multipurpose Cooperative in Carigara, Leyte is an active cooperative organized in

the year 2005 with 75 members at present. The cooperative covers 29.25 hectares of coconut
plantation, aiding them in their coconut based livelihood. The cooperative manufactures food and
non food products made from coconut, non food products such as coco coir and copra. For their coir
production, they are one of the 16 cooperatives in the province that benefited the complete
decorticating machine assistance from PCA. Meanwhile, copra and coco shells are sold to barangay
level traders. Their annual copra production is at 12.8MT, although the cooperative can increase their
copra manufacturing, only that, traders in the barangay seldom buy due to flactuating prices. In this
investment plan, Macalpi being the next barangay located next to Binibihan, BAC will serve as the
forward linkage or market of their copra and coco shells to absorb 100% of their volume.

Brgy. San Fracisco West Farmers Association

With a total membership of 46 active farmers, this farmer association covers 116 hectares of coconut
plantation intercrop with coffee and is operating for 10 years as of today. Currently, the group is also
engaged in the production of banana covering 30 hectares. The association produces copra but due to
the fluctuating buying price and higher cost of production, the association opt to sell whole nuts in
the public market. With their current coconut plantation, the association are able to produce an
average of 4,640 nuts annually or 110.57 MT . With the availability of raw materials, the association is
identified as potential supplier of whole nuts for the copra production of KAMMPIL Agricoop.

III. Production Profiles

Table 3. Summary of Annual Production Capacity of FOs

Total Project Annual Annual RM Planned
Name of Landholdi Expansio # of production Coconut Annual Copra Copra RM
Associati ng n Area bearing for copra Production in Production Expansion Needed
on (Has) (Has) trees (w.nuts) (MT) (MT) (MT) (MT)
BAC 39 40 1,267 50,680 72.40 14.67 13.71 68.57
BEOFA 35.3 15.5 1,830 73,200 104.57 20.91 17.71 88.57
SFWA 116.6 23 1,935 77,400
ASCFA 652.0 650 32,797 1,311,880 1,874.11 374.82 228.97 1,144.86
MCC 29.2 22.8 1,120 44,800 64.0 12.80 7.82 39.09
AMAHIT 57.4 41 1722 68,800 98.4 19.68 168.68 843.43
TOTAL 1,110.75 479.20 39,551 1,513,160 2,161.66 464.81 268.29 1,341.43

IV. Investment Priorities

This investment plan will prioritize Business Development Services through a modular design capacity
development and technology transfer to all FOs. This is to equip them with skills to improve
productivity and their farming practices in general, most importantly, increase quality acceptability of
their copra, and business management training to hone entrepreneurial mindset. On the other hand,
productive investment to Binibihan Agriculture Cooperative (BAC) and Brgy. Esperanza Organic
Farmers Association (BEOFA) will be proposed to improve their trading volume and quality by
providing them the following interventions:
Table 4. Requested Productive Investment for Beneficiaries
Productive Investment Beneficiaries
1. Platform Weighing scale BAC and BEOFA
2. Storage Warehouse Facility BAC and BEOFA
3. Copra Moisture Meter BAC and BEOFA

V. DIP Timeline

Based on the timeline set by the participating value chain actors for coconut during the recently held
consultative meetings and FGDs, Productive investments identified have been requested to be
implemented starting 2024; for the business development services the project and the DIP
participating firms agreed to be implemented all throughout the project timeline, For Farm to Market
Infrastructure (No Identified FMI yet)

VI. Investment Summary

The total project cost is Php 2,090,000.00 with Php 1,040,000.00 Productive Investment for BEOFA
and BAC with their counterpart amounting to Php 208,000.00 per Farmer Organization. Business
Development Services amounting to Php 1,050,000.00. Total matching grant is 1,621,500.00 or 78%
of the cost sharing percentage as presented below.

Source of Financing
Component Amount RAPID Cooperator's Counterpart
Strategic Productive
Investment 1,040,000.00 624,000.00 416,000.00
Business Development Services 1,050,000.00 997,500.00 52,500.00
1,621,500.0
Total Project Cost 2,090,000.00 0 468,500.00
Cost Sharing Percentage 100% 78% 22%

Prepared by:

ALYANNA C. ALCOBER
VCF

Reviewed by:
DIPTEAMMEMBERS

ARACELI D. LARRAGA ERNESTO B. MONTES, JR ELAINE JAYNE P. LIMBAGA

Provincial Director OIC BDD Chief STIDS

NAIZA REINA C. BRAZIL NIEMAR A. ABALO

TIDS PPC

Endorsed to RCU-8 by:

ARACELI D. LARRAGA
Provincial Director
Figure 1. Market Development Model