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Archives
October 1-31, 2007
Agricultural Cooperatives: Catalyst for profitability and answer to globalization
by Ferdinand Dax C. Lorena
Photos by Ferdinand Dax C. Lorena
The advent of globalization and free trade creates a condition wherein the Philippine agricultural sector is changing fast. Imported food products are on the rise, cheap and often subsidized fresh agricultural produce are penetrating the market making our agricultural productivity low compared to our Southeast Asian neighbors. Moreover, most Filipino farmers are still engaged in traditional methods of production and live below the poverty line.
Under such circumstances, there is an urgent need to address these issues and the answer might lie in the formation of agricultural cooperatives.
On 12-29 September 2007, a group of 17 Filipinos from the Department of Agriculture (DA) and state colleges and universities (SCUs) attended a “Training Programme for Young Leaders” sponsored by the Japanese International Cooperation Agency (JICA).
One of the key objectives of the program is for the participants to gain understanding about the structure, role and management systems of agricultural cooperative organizations in Japan.
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| The author (left) with officials from the Yamagata General Agricultural Research Center, Japan. |
The training created an opportunity for the participants to study the Japan Agricultural (JA) Cooperatives in Yamagata, Japan and see it in the perspective of a highly successful, effectively organized, and efficiently managed organization.
Uniting the weak
The basic tenet of an agricultural cooperative is mutual aid. Those farmers in a weak economic position must unite and help each other for the common good.
A cooperative provides a venue to lend money, buy raw materials at low price and sell products directly to consumers. This empowers poor farmers through higher profits and an opportunity to alleviate them from poverty.
Through a cooperative, the standard of farming is increased based on collaborative works and technology sharing. This ensures quality of produce and lowers cost of production making it more competitive in the market as against imported goods.
Characteristics of Japanese cooperative: The Case of Yamagata
JA Yamagata is a regional cooperative with almost 21,000 members. It employs 557 people and holds office bigger than the Bureau of Agricultural Research (BAR) with an asset and liabilities in 2005 valued at Php61B and net income of Php93M (P1:¥0.39).
This is the cooperative that is involved in all aspects of a farmer's life from farm planning to selling, from marketing, banking to technology dissemination and even with the medical treatment, welfare and education of its members.
JA Yamagata is also a prime decision maker in the conduct of research and development (R&D) in agriculture thereby exemplifying a true market driven R&D.
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| The author during one of their field visits in Japan. |
The good thing about this cooperative is that, farmers become traders wherein profitability of stakeholders is dispersed as farmers and capitalist work hand in hand. The cooperative also does the market guaranteeing supply and utilization and determining the best price for the products. Quality is also assured as products are standardized.
The use of “branding” and first-rate “packaging” in all the major products of Yamagata such as cherries, pears, wines and beef is a marketing coup. Raw materials are processed into commodities, carefully packaged and branded with JA Yamagata assuring quality, product brand, and processor's trade name retention to consumers.
Implications to agricultural development
Given the level of success, organizational structure, and the critical role of JA Yamagata, it is plausible that it can be replicated in the Philippines. If there is cooperation among farmers, businessmen, and the local government, agricultural cooperatives will be a major catalyst in the agricultural development.
Marketing concepts such as branding and the effective use of packaging is also a driving force in the success of JA Yamagata as it gives competitive advantage over imported goods through the projection of high quality and being locally manufactured.
There is a great opportunity for Philippine agriculture products. Having farmers' organizations and cooperatives to operate their own promotion and business management is a good start to be competitive particularly in handling their goods both for domestic and international markets. 
October 2007 Articles:
:: Yap promotes abundant & nutritious agri food products
:: World Food Day highlights “Right to Food”
:: 72-kilogram squash aces as “Pinaka-BEST” People's Choice
:: BAR awards 16 outstanding researches in agri & fisheries
:: Locally-developed ND vaccine wins PSAS Award
:: BAR conducts bio-organic fertilizer orientation
:: Eleazar receives distinguished alumni award from UPLBAA
:: UPLB celebrates Loyalty Day; Velasco highlights DA support
:: Nutritious malunggay-based recipe wins 2007 Agri-Cookfest
:: Food company eyes the potential of malunggay for biofortification
:: Beverage from malunggay
:: BAR promotes nutraceuticals and cosmeceuticals derived from food crops
:: BAR introduces potential product lines from Philippine oregano
:: A fresh look at siling labuyo
:: Operating the onion industry with OPREMS
:: Empowering upland communities through Dampalit watershed project
:: Agricultural Cooperatives: Catalyst for profitability and answer to globalization
:: DA adopts IPM scheme against Brontispa
:: DA implements program to abate use of chemical fertilizers
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