2. 1. Identify the situation (Describe it to yourself and to others so that it is clear what the
social reality is that you are trying to analyze)
2. Collect information (Collect as much info as you can about the situation or problem;
Your resources should include more than one author's opinion, as well as a variety of
different perspectives)
3. Reflection (What caused you to become concerned? Why do you think there is a
problem? Does the situation affect you or a loved one personally, or someone else? Why
is someone else's problem important to you? What do you value in life that this situation
is disturbing?)
4. Ask questions (Find out about the history of the situation. How did it come to be? How
long has it been going on? When did it begin? What important decisions were made
over time? Why were decisions made? Who was involved? What are the laws and
policies concerning this situation? Who made the laws and policies? What is the political
climate? What role does the government play, as well as the churches, civic
organizations, business and industry, and any other related group? What are the
relationships between the various groups and persons involved? What are the traditions
involved? What are the other value systems and beliefs involved?
5. Understanding the situation (Essentially, the goal is to ask as many significant
questions as possible, so as to arrive at as complete a picture as possible of the situation
of concern)
6. Strategize and plan for possible means for resolving the problem (Understanding the
situation, however, is not the same thing as finding a solution to the problem. The next
step is to strategize and plan for possible means for resolving the problem, using as a
foundation our newly acquired understanding of the situation

3. I. Introduction
 Philippine Economy
 Poverty Statistics
 Poverty in Mindanao
 Vicious Cycle of Poverty
 Vulnerability of Small Farmers
 Productivity, Market Access, Infra Access, PH Handling,
Value Chain Participation
II. Assessment of the Situation
 Philippine Agriculture
 Review of Agri Sector
 Bottlenecks in Agri Sector
 Vision for Agriculture
III. Factors preventing farmers from harnessing
their potentials
 Distorted and Inefficient Market
 Inadequate Investments
 Institutional Bottlenecks
IV. Ongoing and Planned Interventions
 2004-2010 MTDP
 2011-2016 MTDP
 Other Support
V. Key Issues
VI. Recommendations
VII. Conclusion

5.  Farmers are
considered the
backbone of
economy.
 In many developing
agricultural
countries, almost
1/3 of the world’s
population depend
on smallholder
farming.
 As such,
smallholder farming
is important in
terms of agriculture
and food security.

6.  Poverty in the Philippines is
essentially a rural
phenomenon.
 Magnitude of poverty is
highest in the rural areas in
terms of both level & incidence
 Accounts for 20% of GNP, or 1/5
of the economy
 One-third of the population is
employed in agriculture or agri-
related industries
 Agriculture plays a major role
in the generation of incomes
and employment
 The development of the sector
is essential to any antipoverty
program

7. Indicator 2006 2009
Poverty Threshold and Poverty Incidence
Annual Per Capita Poverty
13,348 16,841
Threshold (in Pesos)
Poverty Incidence of
21.1 20.9
Families (%)
Poverty Incidence of
26.4 26.5
Population (%)
Food Threshold and Subsistence Incidence
Annual Per Capita Food
9,257 11,686
Threshold (in Pesos)
Subsistence Incidence of
8.7 7.9
Families (%)
Subsistence Incidence of
11.7 10.8
Population (%)

8.  Root causes of high poverty are conflict,
historic dispossession of land, & internal
displacement.
 62% poverty rates are in provinces such as
Maguindanao while only 29% nationwide.
 6 of the 10 poorest provinces in the Philippines
were located in Mindanao (in 2006)
 Child stunting is 34% compared with 28%
nationally
 Acute malnutrition rate is 4.8% nationwide,
but 7.1% in Maguindanao, 8.3% in North
Cotabato, & 8.2% in Sultan Kudarat.
 Poverty is partially attributable to decades-
long stagnation in smallholder agriculture.

9. Many cycles overlap or perpetuate new cycles and therefore any attempt to
depict the cycle of poverty will be far more simplistic than realistic

10. Causes of vulnerability:
 Exposed to an environment
where they are vulnerable  Lack of info & training to
to exploitations: interpret movements of trade
in the market,
 By traders, informal lenders
 By manufacturers  Lack of capital,
 By politicians
 Lack of post-harvest facility
 Total no. of farmers is at 5M, logistics to augment & improve
their economic livelihood.
2.1M are rice & corn farmers.

11.  Land holdings of poor farm
family range from 0-3 has.
 Limited access to irrigation;
Cultivate on remote, sloping
hills, which provide for low
productivity
 Tend to produce staple crops
(corn, rice) w/c they can
consume & market locally, but
for low prices.
 Lack technical capacity to
increase production, or
employ NRM to be resilient to
calamities

12. Limited access to markets
 There is strong market demand &
strong private sector for delivering
produce to market.
 However, lack the scale required by
institutional buyers, access to credit, &
info about market requirements.
 At planting, small farmers go to local
traders to secure high-interest loans.
 At harvest, return to the same local
traders to repay loans & sell crops at
prices far below the formal market.
The cycle continues.

13.  Incur significant losses due to  Typically dry their produce using
poor post-harvest handling. rudimentary methods, such as
drying on tarmac roads & roofs.
 Post-harvest losses can reach up
to 50% as a result of spoilage &  Only 80% of domestic rice
waste at the farm level, poor demand is met by domestic
drying & storage, pest infestation, production.
& poorly maintained or outdated
rice mills (studies from IRRI).


14. Small farmers have few key linkages to diverse
stakeholders:
 Unfamiliar &/or unknowledgeable about financing options beyond local
usurious creditors;
 Do not know about government resources;
 Lack infrastructure (such as irrigation canals, roads, dryers, warehouses, or
other);
 Not linked to agricultural research;
 Lack the knowledge to diversity towards formal markets.,
They tend to have low yields of low quality, and sell to local traders for rock-bottom prices.

16.  Agriculture and Fisheries Sector
an important contributor to the
economy:
 Contribution of 18.1% to GDP
 Employed 34.3% of the labor
force (in 2009).
 Grew 3.2% on ave. over the last
5 years, but below the target of
4.3-5.3%.
 Gains in agricultural labor
productivity, with annual ave.
gains of 1.6% in the last 5 years.
 Major drivers of growth are
banana, corn, fisheries,
agricultural services and palay

17.  In comparison with selected  Positive trade balance for
SEA countries, land HVCs (e.g., vegetable and
productivity and cost fruits) & fisheries.
competitiveness of traditional
crops, (e.g., rice, corn and  The sector’s growth had low
sugarcane) ranked low, but impact on the welfare of the
rated higher with HVCs like rural sector, still accounting for
banana. 70% of the poor population,
 Export value at its lowest in  Exhibiting declines in per
2009, as we continued to be a capita income (-1.4% from
net importer with a trade 2000 to 2006), amidst rising
deficit of $2.4 B prices of food commodities

18.  More than 70% of the
country’s population is
dependent on agriculture.
 Provides income &
livelihood to the million of
farmers & their dependents.
 Attaches the high priority
of transforming agriculture
into a modern, dynamic &
competitive sector.
 A sustained expansion of
the national economy
requires sustained growth
in the agricultural sector.

19.  Over the past 6 decades,
confronted by internal & external
bottlenecks that constrained its
performance & growth.
 Reforms to increase productivity,
efficiency, competitiveness,
market adaptability, &
sustainability of agri-based
industries, were hampered by:
 Inadequate resources,
 Limited implementing capabilities
of national and local government
units (LGUs), and
 Weak coordination among
implementing agencies.
 Occurrences of natural disasters,
international market crisis
exacerbated the real growth of
the sector,
resulting to contraction in output.

20. The Philippine government’s vision is the transformation of farmers into
business entrepreneurs.
 Recognizes the need for farmers to move from their present state of
subsistence to where they are driven to produce more efficiently
making farming more profitable.
 The successful development of this sector would depend on a well-
functioning marketing system which would allow farmers to reap their
returns for their produce.
 If this will be attained, more investments are expected to come in,
thereby generating more employment & income in the farm sector.

22.  Distorted and Inefficient Market
 Lack of Market Information and Ability to
Analyze Same
 Poor Transport Facilities
 Inadequate Post-Harvest Facilities
 Excessive Government Intervention/Regulation
 Lack of definite product quality standards
 Inadequate Investments
 Lack of Financing and Credit Facilities
 Provision of Low-Cost Financing
 Uneven Tariff Protection
 Inadequate Government Spending
 Uncertainties about the Comprehensive Agrarian
Reform Program (CARP)
 Institutional Bottlenecks
 Lack of Organized Farmers
 Weak Linkages
 Lack of Entrepreneurial Skills Among Farmers

23. Lack of Market Information and Ability to Analyze
 Lack of knowledge makes
farmers price-takers,
leaving them at the mercy
of traders.
 The lack of info
opportunities & capability
to analyze limits their
ability to plan their
activities for longer periods
of time.

24. Poor Transport Facilities
 Rural infrastructure is in a
deplorable condition.
 Increasing percentage of
farm do not have access to
FMRs.
 The poor state of transport
infrastructure has prevented
efficient movement of agri
goods & raised their prices in
the market.

25. Inadequate Post-Harvest Facilities
 The inadequacy of post-harvest
equipment & facilities limited
farmers’ option in marketing
their produce.
 Added post-harvest losses
 Constrained farmers from
producing more due to the lack
of facilities
 Prevented farmers from adding
more value to their produce

26. Excessive Government Intervention/Regulation
 Price controls, government
monopolies, subsidies &
other forms of
interventions have
distorted agricultural
markets, constraining
production growth,
increasing imports, &
weakening the country’s
food security situation.
 Made farmers vulnerable to
political exploitation

27. Lack of definite product quality standards
 Absence of a definite
product quality standard
does not allow producers to
command a better price for
their produce.
 Without the guidance on
the appropriate variety &
quality of products that the
market requires, local
producers find it difficult to
directly penetrate both the
domestic or export market

28. Lack of Financing and Credit Facilities
 Most agricultural producers
are small farmers with
inadequate financing.
 Their financial requirements
are usually provided by
traders at high interest rates.
 Small farmers borrow money
from informal sources
because these are accessible,
require no collateral and
voluminous documents like
those required by formal
lending institutions.

29. Uneven Tariff Protection
 The low tariff protection
received by the
agriculture sector
compared to the non-
agriculture sector is one
of the factors which
have contributed to the
unattractiveness of
agriculture to
investments

30. Inadequate Government Spending
 Government expenditures
for roads, bridges, ports &
irrigation systems as well
as for R&D of
productivity-enhancing
technologies in support of
the agricultural & rural
sectors have been
inadequate & less
proportionate to the
sectors’ share in the GDP.
 This neglect for the sector
has kept investments
away from agriculture

31. Uncertainties about the Comprehensive Agrarian Reform
Program (CARP)
 Risks & uncertainties emanate
from the set of rules which govern
the CARP’s implementation.
 Many areas remain undefined for
prospective businessmen & local
agribusiness firms are unfamiliar
with the new organizational &
institutional arrangements under
CARP.
 Ambiguities & uncertainties about
CARP have aggravated the
unattractiveness of agriculture to
investments

32. Lack of Organized Farmers
 Many farmers are unorganized &
this limits their ability to market
their produce more effectively.
 Left to the mercy of traders who
can dictate farmgate prices.
 Being organized into coops or
producers’ associations allows
them to buy inputs & sell produce
collectively, transport it in bulk,
for more efficient operations
 Gives them stronger bargaining
power to command better prices
for their produce

33. Weak Linkages
 Farmers fail to realize maximum
return because linkages between
them are weak.
 Thus, are deprived of access to stable
markets and therefore, stable prices.
 Deprived of access to a steady and
stable supply of raw materials.
 Impede the formation of greater and
stronger forward & backward linkages
in the sector

34. Lack of Entrepreneurial Skills Among Farmers
 The farmers’ lack of
entrepreneurial skills has
prevented them from properly
utilizing marketing investment
info for longer-term production &
marketing planning, & from taking
advantage of economic
opportunities.
 The possession of these skills
would make their operations more
efficient and profitable, thereby
enabling them to earn more

36. Goal 1: Develop at least 2M has. of new
agribusiness lands in order to create at least 2M
jobs, or 1 job per hectare; and
Goal 2: Make food plentiful at competitive prices
where the cost of priority “wage goods” such as
rice, sugar, vegetables, poultry, pork and fish, &
other important non-wage goods like corn must
be reduced

37.  Expanding effective
production areas:
 Increasing intensity &
diversification
 Cost-effectively cultivating
idle & marginal lands
 Expanding the product mix:
 Adopting new/improved
agricultural production
systems
 Large-scale program of non-
traditional HVCs
 Value-adding

38.  Production support
 Addressing the constraints to high yields & low
production costs
 Logistical support
 Postproduction handling, marketing, &
distribution problems that lead to high
agricultural input & food retail costs
 Governance and institutional support
 Addresses policy & regulatory bottlenecks to
efficient agricultural production & distribution as
well as competitive food prices
Ensure that the reduction in production and distribution costs due to the
productivity and logistics measures will result in higher farm incomes &
lower food prices.

39.  Agriculture sector has
exceeded production
targets
 But remains
uncompetitive due to:
 High cost of inputs
(fertilizer, chemicals, seeds),
 Large post-harvest losses
and the
 Disruption of extension
services due to devolution.

40. Goals/Objectives:
1. Raised and sustained productivity & incomes of agriculture &
fishery-based households & enterprises;
2. Increased investments & employment across an efficient supply
chain;
3. Transformed agrarian reform beneficiaries into profitable
entrepreneurs;
4. Reduced risks , including climate change impacts, inherent to the
sector;
5. Ensured food security at all levels; &
6. Strengthened/enhanced policy environment & good governance.

41.  Diversification: facilitate and promote diversification of production
base and livelihood options
 Rural infrastructure: establish climate-resilient agriculture infra
 Market development: provide effective market assistance
 RD&E: Update reliable databases and information systems
 Credit: improve credit access through stronger partnership between
government and private financial institutions;

42.  Create jobs - through private investment
 Localize agricultural promotion & development - regional strategies
must take precedent in promoting sector competitiveness
 Promote value-adding of products and develop capacities for value
chain management
 Promote vertical & horizontal integration of input, production, and
marketing
 Strengthen the country’s agricultural exports through better
resource allocation focusing on the country’s existing competitive
advantage
 Create more job opportunities by expanding existing markets &
aggressively exploring new markets

43.  Achieve land tenure stability of the
ARBs
 Strengthen organizational capacity of
ARBs & ARB organizations to manage
& develop agri-enterprises;
 Transform microenterprises into formal
& viable SMEs through clustering of
ARCs & establishing networks of
enterprises;
 Facilitate access to credit
 Establish rural physical infrastructures

44.  Reduced risks inherent to the
sector, including climate change
impacts.
 Damage and loss of crops,
livestock and fishing grounds;
water allocation and
prioritization of water supply
for irrigation, domestic water,
and energy are just a few
emerging problems that should
be dealt with as early as
possible.
 Proper scientific guidance is
needed

45.  National Land Use Policy & Protection of Prime Agricultural Lands.
 Expected to provide the legal & other mechanisms for not only land
reform areas, but also zoned areas for water and water uses, especially
for agriculture.
 NFA Reforms to seek further rationalized grains sector trading.
 To restructure the NFA to separate its regulatory & proprietary
functions.
 Agricultural Bureaucracy Rationalization.
 To rationalize the agriculture bureaucracy through the efficient and
effective convergence and complementation of the agriculture,
agrarian reform and natural resources (AARNR) service agencies &
related offices to address institutional overlaps.

46.  Accelerated Irrigation Development.
 NIA shall undertake a six-year accelerated irrigation
program for the construction of irrigation projects in the
remaining unproductive, unirrigated lands nationwide.
 Food Safety.
 Aims to put in place a coordinated food safety system
 Amendment of the Tariff & Customs Code
(strengthening the anti-smuggling mechanism of
agricultural products).
 Should further strengthen the anti-smuggling mechanism

47.  Address several areas of weaknesses for the
government:
 Limited technical capacity,
 Unclear communication lines and coordination,
 Infrastructure support, among others…

49.  The government has excellent strategies.
 But weaknesses appear in implementation.
 Which can be reinforced by complementary
programs through NGOs and the private sector.

50.  The expansion of the production  Often, more production meant
base involves breaking out from surpluses that depress farm gate
subsistence agriculture by prices.
increasing and diversifying the
marketable surplus of the farm.  Meanwhile, lower farm gate
prices also do not automatically
 However, raising agricultural & lead to lower food retail prices.
fishery production &
competitiveness have not  It appears that an inordinate
automatically & consistently led share of the benefits from higher
to increased farm incomes. production goes to middlemen.

52.  What is needed, therefore, is a more holistic approach
in reducing rural poverty that will not only address the
production bottlenecks in agriculture but also its
inherent vulnerabilities.
 This approach calls for the promotion of agribusiness.
 This will not only address agricultural production
constraints but also post-production handling, value-
adding, and distribution concerns, all of which are the
major and inter-connected determinants of job
creation and income stability in the countryside.

53.  Expand substantially the production base
 Raise production and distribution efficiency
 Promote equitable distribution of production & productivity gains.
Thus, production and productivity improvements will have
to go hand-in-hand with governance and institutional
reforms to ensure that, among others, production and
efficiency gains will indeed result in commensurate farmer
and consumer welfare gains.

54. Address the inefficiencies along the agricultural
value chains
FARMERS
+ MARKETS

56. A phenomenon Low income,
Debt &
Low assets,
where poor further loss of
Low
families become income
education
trapped in
poverty for
generations.
They have no or Low security Lack of
limited access to cover from capital, Lack
critical resources, economic & of in demand
such as education health risks skills
and financial
services,
Lower
subsequent capacity to
generations are generate
also income
impoverished.

57. • Regulatory
Macro environment
• Macroeconomic
condition
Improve the
participation of
small farmers in
the agricultural
value chains
Meso • Efficiency
• Effectiveness through
increased and
better
engagement of
Micro • Access
• Impact
the key
stakeholders
along the chain.

58. Government, Institutional
Markets, Financial Institutions
Academe, Church,
Research Institutions
LGUs, NGOs, Bus.
Service Providers
The long-term goal Farmer Leaders, POs
Strengthen the
capacity of local
Small
communities to
take control of their
Farmers
own development