SEARCAAgriculturalDevelopment

SpecialSeminar

AdvancingAgribusinessthroughCooperatives:
TheCaseofSoroSoro Ibaba Development
Cooperative
Dr.DavidJ.King,SIDCConsultant
February9,2010

TheSIDCapproachtoagribusinessdevelopment
istoprovideagribusinessopportunitiesthrough
thecooperativeforsmallfarmersand
entrepreneursofSMEfood,agriculturaland
resourcebasedenterprises,thatontheirown
wouldnotbeabletocompetewithlargescale
commerciallyfinancedandcorporatelybacked
enterprises.

Advancing Agribusiness through Cooperatives: the Case of Sorosoro Ibaba Development Cooperative
Dr. David J. King | February 9, 2010 | SEARCA ADSS 1
 Introduction:OutlineofthePresentation
1. The40years(19692009)processofSIDCfrom
smallconsumercooptothelargestagricultural
cooperativeinthePhilippines.
2. TheChallengesthathadtobeovercomeduring
thethisdevelopmentprocess.
3. SIDCs VisionandmissionasaNational,Asian
evenglobalmodelleadingagricultural
cooperative:Somespecificissues,strategies,
partnershipschallengesandopportunities.

Introduction:Myintellectualandpersonal
commitmenttocooperatives
UniversityofWisconsinacademicprogramin
agriculturaleconomics:Commitmenttopowerof
collectiveactionininfluencingpolicyfor
institutionalreformasabasisofruraland
agriculturaldevelopment.
A40yearcareerinagrarianreformand
developmentinAfricaAsiaandthePhilippines
matchingSIDCs owndevelopmentprocess.

Advancing Agribusiness through Cooperatives: the Case of Sorosoro Ibaba Development Cooperative
Dr. David J. King | February 9, 2010 | SEARCA ADSS 2
 SIDC:Foundationsofasuccessful
agriculturaldevelopmentcooperative
ConsumerCooperativestore(1969):59members
TransformationtoSNandagriculturalcooperativewith
memberbackyardpiggeriesusingcooperativefeeds
Independencefromgovernmentprojectsupportforsmall
scalefarmersproductionandfinance.
Participatoryandopengovernanceofthecooperative
Patronagerefundsasbasisofbuildupofmembershare
capital forbothregularproducerandassociateconsumer
members
Commitmenttomember,familycommunitybenefits.

FeedmillastheSIDCengineofgrowth
LandBank&SIDCselffinancing
Ave.production:9,000bagsdaily
hog,poultry,fishmash&pelletfeeds
semicomputerized
withmechanizedcornstorage

Advancing Agribusiness through Cooperatives: the Case of Sorosoro Ibaba Development Cooperative
Dr. David J. King | February 9, 2010 | SEARCA ADSS 3
 Feedmill Laboratory

PAIWICONTRACTGROWING
OnlyformemberswithFCRs andacceptable
mortality/morbidityrates
Fattenersonly(formerlyBreedersaswell)
Stocks,Feeds,Veterinary
Services&Marketing
EqualSharinginProfit
PatronageRefunds
LoanforPigPen

Advancing Agribusiness through Cooperatives: the Case of Sorosoro Ibaba Development Cooperative
Dr. David J. King | February 9, 2010 | SEARCA ADSS 4
 ARTIFICIAL INSEMINATION
OnlyinSoroSoro vicinityorwhereAIservices
canbecontractedout

PIGFARM
850sowlevelpigletmultiplierfarminTaysan
Higradesowsandboars
Firstclassfacilities
FarrowFinishorforPaiwi biik?

Advancing Agribusiness through Cooperatives: the Case of Sorosoro Ibaba Development Cooperative
Dr. David J. King | February 9, 2010 | SEARCA ADSS 5
 COMMUNALMODELFARM
Capacityof1,130headshogfatteners
SIDCprovidesmembersofhogpen,stocks,
feedsandveterinaryproducts&services
Memberscaretakerswith25%profit
Pigmanurefedintobiodigester toproduce
methaneandsolidscompostedforvegetable
production

HOGSELLINGPEN
Speedsupsalesofhogs
electronicweighingscale
Preventsspreadofdiseases
Sellingpenfees

Advancing Agribusiness through Cooperatives: the Case of Sorosoro Ibaba Development Cooperative
Dr. David J. King | February 9, 2010 | SEARCA ADSS 6
 SAVINGSANDLOANS
Deposits
P150Mmemberdeposits
Loans
CashLoans
HogFatteningProgram
HogBreedingProgram
HousingLoan
Hogpenloans
Environmentalloans
StudentLoans

Verticallyintegratedagribusinesses
Batangas CitySlaughterHousemanagement
FarmerVicprocessedmeatproducts(2003)
NewMeatProcessingPlant(2007)
51,000headlayerfarm(2008)

Advancing Agribusiness through Cooperatives: the Case of Sorosoro Ibaba Development Cooperative
Dr. David J. King | February 9, 2010 | SEARCA ADSS 7
 Businessdiversification
CoopmartBranchesandexpansion(5)
Gasolinestationsandautoservice(3)
Waterrefillingstation
CableTVstation
Meriendster fastfoodoutlets
6to9 sarisaristorescarryingSIDCproducts
Insuranceproducts

SIDCVisionStatement(2008)
Asagloballycompetitiveandworldclass
Cooperativeconglomerateoffering
technologicallyadvancedproductsand
services,SIDCcontinuestobeamodelof
goodgovernancesthatpromotessustainable
environmentandensuresthewelfareof
stakeholders

Advancing Agribusiness through Cooperatives: the Case of Sorosoro Ibaba Development Cooperative
Dr. David J. King | February 9, 2010 | SEARCA ADSS 8
 SIDCs MissionStatement(2008)
Members:Shallvalueandprotecttheirinterests
throughsoundpolicyandproactive
management.
Officers&employees:Shallpromoteand
supportanenvironmentwheredignity,
diversityandethicalconductarevalued,
officersandemployersarerespected,their
contributionsrecognized&career
developmentencouraged.

SIDCs MissionStatement(2008)
Patrons/BusinessPartners:Shalloffer
competitiveproductsandservicesand
observeethicalstandards
Community:Shallpursueprogramsthat
promotecooperAtive development,
sustainble developmentandwelfareofa
widercommunitythroughactivecollaboration
withotherunitsofSociety

Advancing Agribusiness through Cooperatives: the Case of Sorosoro Ibaba Development Cooperative
Dr. David J. King | February 9, 2010 | SEARCA ADSS 9
 SourcesofSIDCmembership&business
expansion
OpeningupofnewfeedoutletsinMindoro,Panayas
wellasalloverREGIONIVA
Revivingindebtedagriculturalcooperatives
(Matungao,Or.Mindoro2002;Jaen,nueva Ecija 2007
feedcooperative)
NewSavings&Loanoutlets(200910)
AgribusinessandR&Dpartnerships(2010)
OFWinvestmentinSIDCBusinesses

Fourissues;challengesandopportunities
forSIDC
1. EnvironmentallySustainableHogfattening
enterprises
2. SecuringFeedinputmaterialstoprotectlongterm
competitivenessoffeedmill&memberpiggeries.
3. DevelopingmarketsandtestingofBIONfor
sustainablecosteffectiveorganicgrainandcrop
production
4. DevelopmentofcapacitiesofSIDCmembersandstaff
forSIDCagricultureenterprisedevelopmentandOFW
jobopportunities

Advancing Agribusiness through Cooperatives: the Case of Sorosoro Ibaba Development Cooperative
Dr. David J. King | February 9, 2010 | SEARCA ADSS 10
 EnvironmentallySustainableHogfatteningenterprises
CHALLENGES(2002 2006)OPPORTUNITIES

SIDCownpigfarmsnot
environmentallycompliant
1100fattenerunitwith
non functionalbiodigester
slurrysettlingponds&
facultativelagoon.Waste
justflushedintoriver.
1300sowmultiplierunit
faultyfacultativelagoons
DOSTandCIDASEDCOP
Projectsupport
environmental
assessment,technological
modificationtotransform
intomodel communal
greenfarm.
trialsandtestingofpig
manureandbiodigester
slurryforcompostinginto
organicfertilizer

EnvironmentallySustainableHogfatteningenterprises
CHALLENGES(2002 2006)OPPORTUNITIES

800SIDCSoroSoro members devt.oforganicvegetable

with65,000pigsflushed
wasteintocanalscreeks
andgroundwater.
Human&animalHealth
problems
WaterContamination
AirPollution
Noncompliancewithgovt.
requirements(formerly
exemptasbackyard
piggeries)
screenhouseusing
compostedpigwaste+trial
production
assessedthenraisedenvt.
awarenessofmembers&
LGUs ofenvt.&health
problems
identified,introduced
smallscaleseptictank&
biodigester solutionsfor
memberadoption

Advancing Agribusiness through Cooperatives: the Case of Sorosoro Ibaba Development Cooperative
Dr. David J. King | February 9, 2010 | SEARCA ADSS 11
 EnvironmentallySustainableHogfatteningenterprises
CHALLENGES(2002 2006)OPPORTUNITIES

loanprogramformember
investmentseptictanksand
biodigesters
SIDC/LGUpoliciesto
requireadoption

EnvironmentallySustainableHogfatteningenterprises
CHALLENGES(2006 2008)OPPORTUNITIES

SIDCcommunalgreenfarm SIDCnewtechnicalstaffinsoil
stillnotenvt.Compliant& science,agronomy&
modelenvt.enterprisesonly horticulture.
partiallyfunctional. Devt.andtestingoforganic
Biogasdigesterproducing fertilizerproductionfrom
methanebutpower chickenmanurefromSIDC
generationdifficult gas layerunit
impurities. Field&screenhousevegetable
Developmentoforganic trials&testingwithmember
fertilizerbasedonpigwaste partners.
impededbyfailureofsystem Testingoforganicvegetable
toseparateliquidandsolids marketing.
forcomposting

Advancing Agribusiness through Cooperatives: the Case of Sorosoro Ibaba Development Cooperative
Dr. David J. King | February 9, 2010 | SEARCA ADSS 12
 EnvironmentallySustainableHogfatteningenterprises
CHALLENGES(2006 2008)OPPORTUNITIES

organicvegetable
productiontestingpartially
successfulbutmarketing
problemleftpartner
membersunconvincedfor
ownadoption.
FewSIDCSoroSoro
membersadoptseptic
tanksorbiodigesters
mostremainenvt.non
compliant.
UPLBEnvironmentalresearch
support.
Methanegas&power
generation&slurry
separationtechnology
tested
CCASIDCPhilcoopstudytour
SIDCpartnershipwith
Phil.Coopsengagedin
organiccropandvegetable
production.

EnvironmentallySustainableHogfatteningenterprises
CHALLENGES(2006 2008)OPPORTUNITIES

Membersunconvincedby
greenfarmmodel;no
marketforgasorfertilizer
sonoreturnoninvestment
LGUs requestnon
enforcement
UKgrantforSIDCmember
Biogasgenerator
Wastefrom2,000pigsof30
membersusedtogenerate
125KWpowerusedforSIDC
building.

Advancing Agribusiness through Cooperatives: the Case of Sorosoro Ibaba Development Cooperative
Dr. David J. King | February 9, 2010 | SEARCA ADSS 13
 CoveredInGroundAnaerobicReactorBiogasDigester
BiogassupplyelectricitytoSIDCMainOfficeBuilding

EnvironmentallySustainableHogfatteningenterprises
CHALLENGES(20082009)OPPORTUNITIES
SIDCcommunalgreenfarm DepartmentofAgriculture
stillnotenvironmentally GranttosetupBIONmixing
compliant&model plant.
environmentgreenfarm BIONmixrequires
enterprisesonlypartially sterilization.Methanegasused
functional. toheat11pressurecookers
substantiallyreducingthecost
ofBIONproduction&SIDC
profits.
BIONefficacyfarmerpractice
trailstrials(ongoing)have
includedtrialsonorganicrice
productionandorganic
vegetables.

Advancing Agribusiness through Cooperatives: the Case of Sorosoro Ibaba Development Cooperative
Dr. David J. King | February 9, 2010 | SEARCA ADSS 14
 EnvironmentallySustainableHogfatteningenterprises
CHALLENGES(20082009)OPPORTUNITIES
FewSIDCSoroSoro members TrialsongoingwithBION
adoptseptictanksor enhancedSIDCorganic
biodigesters mostremain fertilizerforuseon
envt.non compliant vegetables,fruits&
ornamentalplants.
ParticipationinBatangas City
environmentalmasterplan.
revivaloflocalLGUinterest
&membersinbiogasdigesters
andseptictanksolutionsand
enterprises.

EnvironmentallySustainableHogfatteningenterprises
CHALLENGES(20082009)OPPORTUNITIES
PartnershipwithBSU
environmentalengineersin
searchforsmallscale
technologiestoencourage
memberenvironmental
compliance

Advancing Agribusiness through Cooperatives: the Case of Sorosoro Ibaba Development Cooperative
Dr. David J. King | February 9, 2010 | SEARCA ADSS 15
 SecuringFeedinputmaterialstoprotectlongterm
competitivenessoffeedmill&memberpiggeries.
CHALLENGES(2008 2009)OPPORTUNITIES
CostoffeedinputsforSIDC SIDCfeedmillnutritionist&
millproducing450tonsof technologystaff+coop
feedadayincreased partnershipsinCanada
dramatically. Analyzedalternativefeed
Useofcornandsoya inputswlowercostsfor
beanexportsinNorth SIDCqualityfeedsand
Americaforbiofuels. potentialsourcesofsupply.
Dramaticincreaseinworld
foodcommodityprices.

SecuringFeedinputmaterialstoprotectlongterm
competitivenessoffeedmill&memberpiggeries.
CHALLENGES(2008 2009)OPPORTUNITIES
Domesticcornproduction CassavaIDaspotentialfrom
reduced&increasedcosts bothlocalandSEAsiansources,
relatedtoincreasedcosts butconcernsrelongterm
ofureaforfertilization. sustainabilityofcassava
Continuousproductionof production
uplandsoilswithminimum CanadianFeedbarleyandfeed
inputs peasidentifiedaspossible
Costsoffertilizersohigh alternativemixbut2008barley
thatrecommended pricesandtransportcostsfrom
applicationofN,P,Krarely plainstatesmadeit
applied. unprofitable.

Advancing Agribusiness through Cooperatives: the Case of Sorosoro Ibaba Development Cooperative
Dr. David J. King | February 9, 2010 | SEARCA ADSS 16
 SecuringFeedinputmaterialstoprotectlongterm
competitivenessoffeedmill&memberpiggeries.
CHALLENGES(2008 2009)OPPORTUNITIES

switchtoothercropswith SIDCfieldstaffandmarketsources
higherreturns/perhectare
/abandonedland
searchforalternativesourcesof
supplyforcontractgrowingwith
Partnergroups
Alternativesourceofsupplyof
corninIloilo,andelsewherein
Panayfoundbutnotprice
competitiveandconcernsre
qualitybecauseofinadequate
drying.
Bukidnon,Mindanaocorn
contractedforIseasonbuthigh
farmgateprices+transpo

DevelopingmarketsandtestingofBIONforsustainablecost
effectiveorganicgrainandcropproduction
CHALLENGES(2008 2009)OPPORTUNITIES
DepartmentofAgriculture SIDCcommitmentto
notcommittedto commercialdevelopmentof
commercialdevelopment BIONascosteffective
ofBIONforcosteffective alternativetoinorganic
switchtolongterm sourcesofN+lowcost
sustainableorganic productionofBIONand
production. fundingforR&D.
Recommendationsfor AggressivepursuitofDAto
BIONusewereaspartial meetandfulfillDAand
substitutefor commercialordersalongwith
recommendedinorganicN promotionalmaterialsfree
application. suppliesofBIONand
agronomic,soilscientistand
microbiologist,technical
servicesforsettingup,

Advancing Agribusiness through Cooperatives: the Case of Sorosoro Ibaba Development Cooperative
Dr. David J. King | February 9, 2010 | SEARCA ADSS 17
 DevelopingmarketsandtestingofBIONforsustainablecost
effectiveorganicgrainandcropproduction
CHALLENGES(2008 2009)OPPORTUNITIES
Mostmixingplants conductingandanalyzing
licensedtoDAorLGUs in resultsoffarmerpracticetrials
locationsthatwerethefoci andformalFPAprotocoltrials.
ofthesmallfarmer DirectCollaborationwith
subsidizeddistribution BIOTECHUPLBtoensure
program. programconsistentwithpatent
mostmixingplants andproductdevelopment
undertookfewdemosand
didnotconductefficacy
trialsasperMOAw
BIOTECHUPLB

DevelopmentofcapacitiesofSIDCmembersandstaffforSIDC
agricultureenterprisedevelopmentandOFWjobopportunities

CHALLENGES OPPORTUNITIES

SIDCmembershiponfamily SIDCcommitmentto
basis. member&familymember
Membershaveinvestedin education.
familymembereducation, SIDCfullUndergraduate
butv.fewinagricultural scholarshipstobestfamily
technology,marketingand memberswillingtostudyin
businessdevelopment. fieldsofstudyrelevantto
Fewsuitableacademic SIDCneeds,includingPaid
programsrelatedfields OJTexperiencewithSIDC

Advancing Agribusiness through Cooperatives: the Case of Sorosoro Ibaba Development Cooperative
Dr. David J. King | February 9, 2010 | SEARCA ADSS 18
 DevelopmentofcapacitiesofSIDCmembersandstaffforSIDC
agricultureenterprisedevelopmentandOFWjobopportunities

CHALLENGES OPPORTUNITIES

Careerdevelopment Studentloanfacilityforall
decisionstakenwellbefore memberfamiliesqualified
SIDCmemberswillingto forcollegeandvocational
transferagricbizandSIDC education.
membershiptooffspring. Specialtechnicalshort
Littleunderstanding coursesforhograisingand
aboutthenatureof wideofothertopics
technicalandagribusiness relevanttoSIDCmember
needsofSIDCinthefuture. enterprisedevelopment

DevelopmentofcapacitiesofSIDCmembersandstaffforSIDC
agricultureenterprisedevelopmentandOFWjobopportunities

CHALLENGES OPPORTUNITIES

Perceptionofwhitecollar
jobs,particularlyin
overseasemploymentare
waytosuccessfulcareers
forfamily
Developmentofspecial
coursesforjobsearchand
preparationskillsfor
membersandtheir
families computerliteracy,
interculturalskillsand
languageskillsforoverseas
work,smallbusiness
development

Advancing Agribusiness through Cooperatives: the Case of Sorosoro Ibaba Development Cooperative
Dr. David J. King | February 9, 2010 | SEARCA ADSS 19
 OverseasagriculturalstudenttrainingundertheIAEAAgriventure
PartnerProgram(20082010)

CHALLENGES OPPORTUNITIES

Recentgraduatesof
academicandprofessional
andtechnicalcourses
usuallyineligibletoapply
asOFWbecauseoflackof Agriventure inCanadain
workexperienceintheir
field.
Providingsuitable
screeningofcandidates,
andtrainingpreparation
programsforonthejob
trainingoverseasina
protectedenvironment
SIDCdevelopingand
operatingprogramof
studenttrainingandwork
experiencewithIAEA
protectedfamilyfarm
environmentsforboth
youngadultstaffand
memberfamilies.

OverseasagriculturalstudenttrainingundertheIAEAAgriventure
PartnerProgram(20082010)

CHALLENGES OPPORTUNITIES

encouragingsomeofthe
participantsinsuch
programstoreturntothe
Philippineswithenhanced
skillsforagricultural
professionalcareersasSIDC
membersorprofessional
staff.
relativelyfewSIDCfamily
membershaveformal
traininginagriculture.
SIDCdeveloped
probationarypartnership
withIAEAtoplace13
traineesinCanadianfarm
familiesinSaskatchewan
andAlbertafor7months
thisyear.
Recruitmentand
evaluationprotocols
Cultural,drivingandtractor
operationskillsofferedto
allsuccessfulapplicants.

Advancing Agribusiness through Cooperatives: the Case of Sorosoro Ibaba Development Cooperative
Dr. David J. King | February 9, 2010 | SEARCA ADSS 20
 OverseasagriculturalstudenttrainingundertheIAEAAgriventure
PartnerProgram(20082010)

CHALLENGES OPPORTUNITIES

Agriculturaldegree
coursesoftenhavelittle
handsonfarming
experiencegraduatesfor
students
Developingpartnerships
withAgricultural
Universitiesandfining
alternativeguaranteeand
financingfortheprogram
Loanandguarantee
programsdeveloped.
Specialstudentexchange
workvisaprotocolworked
outwiththeCanadian
embassy.
Linkageswith
SaskatchewanandAlberta
cooperativeassociationsfor
alltrainees.

OverseasagriculturalstudenttrainingundertheIAEAAgriventure
PartnerProgram(20082010)

CHALLENGES OPPORTUNITIES

inclusionofagricultural
Universityundergraduates
underanOJTarrangement
withjointassessmentand
commitment.
considerationofaddition
ofAustraliaandNew
ZealandforIAEAplacement
in2011.

Advancing Agribusiness through Cooperatives: the Case of Sorosoro Ibaba Development Cooperative
Dr. David J. King | February 9, 2010 | SEARCA ADSS 21
 EndofPresentation

Thankyouforlistening

Advancing Agribusiness through Cooperatives: the Case of Sorosoro Ibaba Development Cooperative
Dr. David J. King | February 9, 2010 | SEARCA ADSS 22