From subsistence to profit
About 15 500 smallholder farmers in Southern Bukidnon – one of the poorest areas of the Philippines – lack access to capital, processing equipment and reliable buyers for cash crops which would allow them to raise their low incomes. Their lack of education in effective farming techniques and agribusiness skills only perpetuates the struggle to survive.
The Swiss Re Foundation has partnered with Sustainable Growth for Rural Venture, Inc. (SUGRUVI) since 2014. This social business organises farmers in the Northern Mindanao region of the Philippines into village clusters and, through demonstration farms, trains and encourages them to plant high-yielding, perennial cassava as both a staple food and a cash crop.
SUGRUVI offers the farmers access to inputs, financing, basic processing equipment and an assured market at a fair price. It also works with ‘model farmers’ who qualify for additional financing to create demonstration farms in their clusters that other farmers can visit and learn from. Each village cluster can rent a ‘rural processing unit’ that allows it to further process the raw cassava tuber.
Bypassing middlemen, SUGRUVI buys the cassava from the farmers at a premium, processes it still further and sells it as granulised cassava chips centrally to institutional buyers. Participating farmers increase their income by an average of 20% to 40% after deducting expenses for farm inputs and use of machinery. SUGRUVI contributes 1.5% of its revenue to community funds managed by the leaders of each village cluster.
An earlier grant from the Swiss Re Foundation went toward the purchase of a truck, a forklift and a truck scale as well as research into cassava-based product diversification. Since then SUGRUVI has recognised a need to take the next step in its growth to ensure continued service to its partner farmers.
GOALS AND EXPECTED IMPACT
In this extension of its collaboration with the Foundation, SUGRUVI will modernise its operations to improve efficiency as well as expand its portfolio to include higher-value cassava products, such as cassava flour, to diversify markets and increase demand. Both these measures will help the company improve cash flow and reduce its dependence on the main buyer, creating a healthier, more sustainable enterprise. SUGRUVI currently works with nearly 3 000 farmers, additionally benefiting the nearly 12 000 members of their families.