1. Value Chain Analysis of Calamansi (citrus madurencis) PhilDHRRA – LSFM Project June 8, 2008 Hanoi, Vietnam

2. Outline 1. Background of the Study 2. Calamansi in Philippine context 3. Production, Costs and Returns 4. Trading and Marketing 5. Prices 6. The simple Value Chain Framework 7. Next Steps

3. Background of the Study 1. Part of the research component of the LSFM project 2. Describe the market chain and chain actors involved 3. Understand the dynamics in the calamansi market 4. Limited to Phase 1 of the VCA only

4. Calamansi in Philippine Context 1. One of the major fruit crops and is excellent source of Vitamin C 2. Sold as fresh product to markets and commercial buyers 3. Processed into syrups, juices, concentrates, powder and purees, and has many medicinal uses 4. Has contributed to agricultural export market, but not a major export crop 5. Major source is Central Philippines and some portions of Mindanao

5. Production, Costs and Returns Calamansi production was decreasing (2000-2004) but reversed this trend in 2005 onwards Yields averaged 9 tons per hectare in the last 7 years (2000-2006) Major source is in Oriental Mindoro province (60%), but they can only harvest 4-6 months in a year Southern Philippines (Mindanao) contribute only 15% of total production, but they can harvest year-round Average farm size is ¼ hectare, although 20% of calamansi farmers cultivate more than 1 hectare of land

6. Production, Costs and Returns Two ways of looking at costs: 1. Cash – Non-Cash and Imputed COSTS 2. VARIABLE and FIXED COSTS

7. Production, Costs and Returns Cash Cost Approach in Calamansi (Php) - 1997 ItemCost / haCost / kg% to total cost Cash costs17,6162.66 67.4% Non-cash costs5990.10 2.3% Imputed costs7,9101.19 30.3% Total costs26,1253.95 100.0%

8. Production, Costs and Returns Production Costs (Case study in Zamboanga Sibugay, 2005) Item Cost/haCost/kg% to total cost Crate5,886 0.7823.5% Picking8,066 1.0732.3% Pruning3,500 0.4714.0% Fertilizing4,800 0.6419.2% Others2,750 0.3711.0% Total cost25,002 3.32100.0%

9. Costs (/ha)Php 26,000 (US $ 604) Production (/ha)9 tons/hectare (average) Farmgate PricePhp 116,700/ton (US$ 2,714/ton) RevenuePhp 90,000/ton (US$ 2,090/ton) Production, Costs and Returns

10. Trading and Marketing Disposition of the Product: 97.5%Sold 1.2%Wastage/Shrinkage 1.3% Payments (Rents/loans/shares)

11. Trading and Marketing Farmer Assembler / Distributor Retailer Consumer Calamansi Simple Chain Actors

12. Trading and Marketing What we know: 1. The major trading hub is Metro Manila 2. All producers supply outside of their province 3. Direct marketing of fresh calamansi can be profitable for farmers 4. Engaging in processed calamansi is more profitable 5. Entering the industrial use market will be more exciting

13. Prices (Php) Price200020012002200320042005Ave. Farmgate11.028.0614.9311.0911.6713.2311.67 Wholesale21.3119.6620.3719.4918.4120.1419.90 Retail30.5028.4329.3229.2828.0830.8729.41

15. Simple Value Chain Ave. retail price: PhP29.41/kg RetailerFarmerAssembler/ Distributor Consumer Ave. farmgate price: PhP11.67/kg Ave. wholesale price: PhP19.90/kg Ave. production cost: PhP3.95/kg Ave. marketing cost: PhP4.56/kg

16. Trading and Marketing What we have to find out (Phase 2): 1. Who are the players in the industrial market use? 2. How much is the market segmentation? 3. What are the price differentiation in each industrial market segment?

17. Next Steps 1. Do Primary Data-Gathering in 2 provinces 2. Complete the data-gaps in the VCA a) Industrial market b) Product inventory c) Capacity-assessment of calamansi farmers 3. Initiate capacity-building activities

18. THANK YOU!

19. Value Chain Analysis of Calamansi (citrus madurencis) PhilDHRRA – LSFM Project June 8, 2008 Hanoi, Vietnam