Struggling tobacco farmers in the northern Philippines have been thrown a lifeline by the government, which will soon open a multi-million dollar food processing plant in Ilocos Sur, along with a trading centre in the province.
The facility, which will start production later this quarter, has an initial budget of PHP165m (US$4.1m) and will be realised through President Benigno Aquino’s Agri-Pinoy programme that is designed to find new livelihoods for tobacco farmers.
The region’s farmers have witnessed a steep decline in demand for their product, leaving government bodies to take measures to keep them afloat.
The new processing facility will have the necessary equipment to process vegetables, beef, pork and chicken for the local market and for export.
Reallocation of land
According to Edgar Zaragoza of the National Tobacco Administration (NTA), tobacco farmers are being given the option to allocate areas of their land for the production of meat and produce across Ilocos Sur and other Virginia tobacco-producing provinces. The raw materials would then be sold to the processing plant at negotiable prices.
“We are also looking for the provision of sufficient capital assistance for our tobacco farmers who wish to venture in swine, poultry and vegetable raising to sustain the requirement for the continuing operation of our food facility once it would be in full operation,” Zaragoza said.
Forecasts by the NTA have shown that the first year of operation will stand to net over PHP8m (nearly US$200,000) for participating farmers, alongside their traditional income from tobacco production.
Income from the plant is expected to more than double by the fourth year, and should reach PHP23.3m (US$570,000) by 2018, according to Zaragoza.
The operation and management of the food facility will be handled by the NTA, which will recruit new graduates from universities and technical colleges to form its initial workforce.
“The facility will not only establish a ready market to the farmers’ meat and vegetables produced but also to create job opportunities to the children of tobacco farmers,” he added. Tobacco farmers’ children will be given preference in the recruitment process once they graduate.
To expand the food processing programme, Zaragoza said the NTA is also looking to construct grain mills in the site to cater for rice and corn produced on the region’s tobacco farms.