1. Fairtrade Value Chain
Empower Negros Agrarian
Reform Communities and
Local Economies
Alter Trade Foundation Inc.
August 29, 2013

2. The Negros Agrarian Reform
Beneficiaries
The Negros agrarian reform beneficiaries are former
farmworkers who earned an average of P71/day ( or
US$1.40) in the former Sugarcane Haciendas.
Women workers were paid half of what the men
received. Child labor was a common practice in the
plantations.
Each agrarian reform beneficiary received land
grants from the government’s Land Reform Program
at an average of 0.5 hectare to 1 hectare per
beneficiary. But land distribution is not enough.
The ARBs still need production capital, sustainable
technologies, capacity building and access to a stable market
in order to become self-sufficient and sustainable.

3. The Cycle of Misery of
Negros Agrarian Reform Beneficiaries *
•Landlessness
•Mono-crop
•No Capital
•No Technology
• No access to
Market
•Soil Degradation
Low
Productivity
Low Income
Malnutrition,
No Education
Poor Housing
No Hospitalization
Low Working Capacity
No Management
Capability
Sickness and Diseases
* From the ATFI Strat-Planning of 2001

4. To effectively alleviate rural poverty, ATFI matched each major
problem of ARBs with a corresponding support service:
Landlessness Support to Agrarian Reform
Farmers’ Lack of Capital Credit and CBU
Lack of Technology Sustainable Agriculture
Low Management Capacity Organizational Empowerment
Low valued Products Access to Product Processing
Limited Market Access Linkage to Fairtrade / and

5. The Negros ARB has to be transformed
From a farmworker
Into a farmer
To a farm entrepreneur

6. Alter Trade Foundation’s Programs
As a Fairtrade Service Provider
ARBs’ Capacity Building
 Holistic Organizational Empowerment
 Sustainable Agriculture Technologies
 Credit and Savings Program
 Advocacy and Networking
ARBsATFI

7. Alter Trade Foundation’s Service Programs
empowering Negros ARBs
Major activities:
• Community Development Planning
• Sustainable Management Systems
• Project Planning, Implementation, Monitoring, Evaluation
• Farm Management Systems
• Marketing Strategies and Planning
HOE: Holistic Organizational Empowerment
A program on organizational development that empowers agrarian
reform beneficiaries to manage their community resources including
ecology, their production activities, their finances and investments, and
strategic development plan.

8. Alter Trade Foundation’s Service Programs
empowering Negros ARBs
Major Activities :
• Agro-Ecological Farm Systems Analysis and Planning
• Bio-Organic Conversion Program / Inspection and Certification
• Organic Soil Nutrient Management
• Crop Production and Harvest Planning
• Diversified Crop and Livestock Production
• Climate Change Risk Reduction/ Adaptation and Mitigation
• Farm Equipment and Enterprise Development
SPADE: Sustainable Production and Area Development
Enterprises
A program empowering agrarian reform beneficiaries on sustainable and
organic farming technologies and farm enterprises through participatory
technology development , farmers’ field school and cross-farm visits.

9. Alter Trade Foundation’s Service Programs
empowering Negros ARBs
Major Activities:
• Installation of Finance Management system per ARB association
• Business Planning / Feasibility Study
• Project Proposal Making
• Training on ‘Accounting for Non-Accountants’
• Savings and Capital Build-Up
• Annual Finance Audit of ARB associations
CRASP: Credit Access and Savings Program
A program providing access to affordable credit for farm production and
enterprises and empowers the agrarian reform beneficiaries by enabling
them to manage their project funds, build-up their own capital, accumulate
assets and equipment, investment planning on farm-enterprises.

10. Alter Trade Foundation’s Service Programs
empowering Negros ARBs
Major Activities:
• Propagation of SA-OF/FT orientation
• Building the local producer-consumer solidarity
• Development of a domestic fairtrade movement
Advocacy:
A service program for propagation of sustainable agriculture-organic
farming and fairtrade orientation among agrarian reform beneficiaries
associations, participation in LGUs’ local development planning, engaging
government agencies in relevant programs (anti-poverty, organic
agriculture, marketing and fairtrade, peace and development, etc.)

11. ARBs empowered by Alter Trade Foundation Inc. through
“Sustainable Agriculture for Sustainable Communities”
A Program assisted by Bread For the World since 1995
Community Devt’
Planning and Gender
Mainstreaming
Sustainable
Agriculture
Participatory
Trainings
Production
planning and
Feasibility Study
Credit Access and
Finance management
Trainings
Production
Implementation
and monitoring
Annual Organic
and Fairtrade
Inspection
Harvest-
Postharvest
Planning/
Implementation
Annual
evaluation and
Management
Trainings

12. NOFTA
Alter Trade Foundation Inc. (ATFI)
( NGO Service Provider)
Fairtrade
Processor
Fairtrade
Distributor
Alter Trade’s Organic and Fairtrade
Value Chain empowering Negros ARBs
“From Gate to Plate”
Fairtrade
Trader
NOFTA Fairtrade Haus

13. What is Fairtrade?
Fairtrade is an alternative trading system that
hopes to:
•Improve the socio-economic situation of small
producers in developing countries
•Contribute to poverty reduction
•Reform the unfair trade relations and structures at the
global and domestic levels

14. Main Features of Fairtrade:
• Built upon the principles of transparency and
partnership
• Promotes economic justice by safeguarding the
rights of disadvantaged producers
• Encourages small producers to self-organize to
attain economy of scale and a competitive volume
of products at a better price
• Promotes ecological sustainability
• Improves the situation of women and children
• Protect the rights of consumers to quality and safe
products

15. Alter Trade’s Organic and Fairtrade
Value Chain empowering Negros
ARBs
ATFI NOFTA FT PROCESSOR FT TRADER
FT
DISTRIBUTOR
RESPONSIBILITIES
Responsive
Participatory
Timely
DELIVERY
OF
SERVICES
Delivery of
Raw Materials
on agreed
QUALITY
VOLUME
PRICE
TIME
Transformation
into Products
on specified
QUALITY
VOLUME
PACKAGE
PRICE
TIME
Marketing of
Products on
specified
QUALITY
LABEL
VOLUME
PRICE
TIME
Delivery to
Consumers on
specified
QUALITY
LABEL
PACKAGE
PRICE
TIME
REWARDS
Satisfaction of
Consumer
Needs and
demands
Reasonable
Profit
50% Advance
Payments
Stable Price
Niche Market
Assured
Profits
Sustained
Orders
Sustained
Operations
•Sustainable
Production
• Assured Income
• Secured Land
Tenure
• Support Services
• Stable market
• FT Premiums
Fulfilment of
MISSION
Sustained
Development
Work

16. • Major ingredient in Fairtrade Chocolates in
Switzerland, Germany and France
• Ingredient for Cosmetics in France.
• Table sugar in all countries
• Ingredients for saki & soy sauce
ARBs’ muscovado were marketed domestically and in the
Fairtrade Markets in Europe and Southeast Asia
Alter Trade provides access to market
to Negros ARBs
90% of ARBs’ sugarcanes are milled as centrifugal raw sugar and
are marketed domestically
• Marketed domestically as table sugar and as
ingredients for food processing
• Has potential for fairtrade centrifugal sugar market

17. Half of the Sugarcane Harvests Of
ATFI Partner ARBs were marketed domestically
From the total sugarcane production
alone, the partner POs in 2011-12 :
 earned a total net income of P39,323,417.56,
distributed dividends amounting to P25,856,627.49
to CLOAholders,
 provided labor incentives amounting to
P1,950,339.32. to non-CLOAholders,
 saved a total Capital Build Up (CBU) of
P6,404,067.27 aside from acquired farm
equipment, tractors and postharvest trucks,
 paid land taxes amounting to P691,175.97 and
land amortization P1,755,194.77 for year 2010-11.

18. Export Price per Kg: US$ 2.47
Export Price per 25Kg Bag: US$ 53.00
Domestic Price per Kg: Php 78.90
Fairtrade Premium
US$ 80 / MT Muscovado
2007 = Ph 2.2 M₱
2008 = Ph 1.8 M₱
2009 = Ph 1.2 M₱
2010 = Ph 1.51M₱
2011 = Ph 2.2 M₱
Self-Reliance Fund from
Korean Consumers
PH₱ 950,000 per year
Period: 2006-2010
Fairtrade Market rewards to Negros ARBs
E F T A
A P N E T
Fairtrade Muscovado

19.  Fully furnished Community Farmers’ Training
Centers
 Computerization of Producers’ Organizations
 Electrification of remote upland villages
 Expansion of production areas
 Small rice farm tractors/ threshers
 Livestock integration into farming systems
 Irrigation facilities especially during the
drought caused by climate change
 Micro-finance program in farmers’ associations
 Community Guest House
 Postharvest financing program for ARBs
The Fairtrade Premiums improved ARBs
community facilities and quality of life
year upon year:

20. Impact of Organic Farming and Fairtrade
on NOFTA Producers
Using the the National Statistical Coordination Board
(NSCB) 2009 statistics: A family of five needs P4,869/mo. or P
58,428.00/year to fulfil total food needs; and P7,017.00/mo.
or P84,204.00/year to keep out of poverty.
ATFI Partner 653 ARBs’ achievement:
 69% or 452 Households are food sufficient or have
crossed the poverty line
 31% or 211 Households are still moving towards
the poverty line

21. Lessons in Value Chain Development
 Value Chain as a strategic complementation of players in a supply
chain, sharing common vision and goals.
 For a value chain to contribute to social development it should
empower marginal producers by building their capabilities in
processing and trading, ‘beyond the farmgate.’
 Value Chain is demand-driven and consumer-oriented in ensuring
the volume, quality (organic, traceability, social-impact,
ecologically friendly) and competitive price of its product.
 But the Fairtrade value chain is characterized by producer-
consumer solidarity too. The Fairtrade premium is a valuable reward
by consumers to producers.
 Transparency, dialogue and mutual-cooperation in responding to
changing requirements of consumers and emerging problems of
players in the value chain.

22. ATFI’s Immediate Plans and Prospect
 Mainstream Fairtrade in Negros to incude
more ARBs in the development and poverty
reduction program
Develop processing capability of producers
through community enterprises , such as, farm-
based muscovado mills, unpolished rice mills.
 Diversify production towards coffee,
cacao, rice and livestock production
and food processing at the farm level and
establishment of value chain for each
product.

23. ATFI’s Immediate Plans and Prospects
From sustainable communities, we should proceed to develop local
economies at the municipal and provincial level, if we want to achieve
broader results in poverty reduction and sustainable people’s
development
ATFI is pursuing the strengthening of the basic pillars for local
economy development in La Castellana, Negros Occidental through a
dynamic partnership between:
LGU /LGA
ACADEME
CONSUMERSBANKS / MFIs
CSOs
PRODUCERS
&
SOCIAL
ENTERPRISES

24. Onward with Social Development !