Status of Small Farmers in Onion Value Chain in San Jose City, Nueva Ecija

Abstract

The case study generally evaluated the onion value chain of Kaliwanagan-San Agustin Farmer Producers Cooperative (KALASAG-FPC). Specifically, (1) to described the organizational profile of KALASAG-FPC in terms of history, purpose, structure, programs or services and resources; (2) mapped out the specific value chain of onion of KALASAG-FPC; (3) identified key players, their roles and specific activities, within the KALASAG onion vertical coordination; (4) assessed the economic status of cooperative farmer members involved in vertical coordination in terms of their productivity and profitability; and (5) identified areas for improvement and recommend ways to improve them. Direct interview with the use of designed survey questionnaire for onion farmers, traders, storage operator, and institutional buyer were used to trace the specific value chain for onion of KALASAG-FPC. Descriptive analyses were employed to determine the inefficiencies in the value chain of onion. Cost and return analyses were done to compare the profitability of cooperative farmer members and non-members. The KALASAG-FPC was registered at the Cooperative Development Authority (CDA) on October 14, 2008, located at Barangay San Agustin, San Jose City, Nueva Ecija. The cooperative membership started with 30 members/cooperators in 2008 to 69 at present (2018), comprised of 53 males and 16 females. The KALASAG-FPC organizational structure has six existing committees: audit and inventory, election, education and training, credit and collection, conciliation, and ethics. There are seven Board of Directors (BOD) and 10 staff. The major commodity and activity of the cooperative include onion production and marketing. Credit and marketing are the primary services offered by KALASAG-FPC to the members. KALASAG-FPC supply the farmer members with farm inputs to grow onions. Onion farmers/producers are the main players in the value chain. Their main role is to produce marketable onions to KALASAG-FPC. The cooperative as assembler is also referred to as the supplier that is responsible for hauling, sorting, weighing, storing and peeling of harvested onions from the farmer members. One of the major roles of the assembler (coop) is to ensure that the required volume and quality are maintained. KALASAG-FPC as a trader is responsible for the procurement of 40% harvested onions of the farmer members wherein the price per kilo is based on the prevailing market price in the community. Institutional buyer (JFC) is the player where onions are delivered by KALASAG-FPC. The cost and return analysis in onion production showed that the cooperative farmer members recorded higher net income and ROI with P15,066.78 and 31.82%, respectively, as compared to non-member with P12,560.64 and 26.47%, respectively. It was also revealed that cooperative farmer members had higher yield compared to non-members with 3,320 kg and 2,609 kg, respectively. In the average production cost per kilo, non-farmer members obtained higher with P18.19 as compared to cooperative farmer members with P14.26. It is an advantage being a member of the cooperative wherein the interest of production loan is 10% lower than the non-member. The members also obtained estimated patronage refund amounting to P11,869.75.