Agri-Work Segmentation
Over the last few years, change had occurred in the ways things are done in the farms and other agricultural ventures that now calls for new policy intervention from government.
Borne of necessity, farming activities, specially in rice, are “outsourced” and are no longer being physically done by t8e farmer. Whereas before, the farmer would personally plow the fields, he now avails of the services of a hand tractor operator. Seeds and/or seedlings are procured from a seed producer. Labor to plant the rice seedlings is contracted so that planting can be done in a short period of time. This also includes other farm activities such as harvesting, threshing, warehousing and the like.
And with this, the role of the farm owner assumes a new dimension as he is now into service contracting, conscious of the cost and results, and can concentrate on other farm maintenance activities (which, at times, are also contracted out).
This is also true (though a long time practice) in the mango industry, where tree owners would contract the whole production cycle or parts of it to a local contractor, who in turn, sub-contracts some of these activities.
The changes also occurred in the poultry integrators when they embarked on contract growing schemes. Now, integrators are availing of other tolling services, to include feed mixing, hatchery and dressing plant operations. These gave birth to a new breed of agri-entrepreneurs who are investing and doing activities that used to be the province of big integrators.
And even industrial buyers of agricultural products are into it, as they now buy processed agricultural products and shy away from buying raw commodity as in the case of food manufacturers. They will not buy ube tubers but would rather buy ube in powdered form and in accordance with their production standard and their periodic volume requirement.
And in all of these, the key words are cost and productivity. Segmentation of farming activities is becoming more of a necessity rather than a choice. And addressing this crucial issue via correct policy direction is a key in developing our competitiveness.
Positioning of common facilities can be focused to address concerns of farmers and other agri-producers in an existing homogenous area. A good size efficient farm tractor can be availed of for a more uniform and deeper plowing capacity rather than a hand held tractor which is the common norm in rice areas. A seed and fertilizer center can be made accessible and so with technology dispersal.
Or a private sector investment in a dressing plant facility can support an enlarged poultry sector in a certain region where chicken are sold as live or transported to a distant facility. This can spawn the birth of other business activities in its immediate area.
This is also true in the establishment of efficient and modern abattoir for the livestock sector to make our meat processing competitive in terms cost and quality. (ACEF is supposed to be the facility for such an investment but this has not been fully realized over the years.)
Provision of efficient post-harvest and similar facilities (which is the battle cry of many agri-executives) can benefit the most number of farmers as cost to these facilities could be within the affordable level, when they are near-by. This can be incorporated in its cost structure and remain price competitive.
Government cannot do all the investments but must provide investors with a security of tenure and an environment where the cost of doing business is competitive against other places, be it domestic or international.
Positive support, thru policy direction given to private sector investments will result in the build up of common or tolling facilities that can provide competitive position to this emerging service segmentation and will make the clustering concept a reality.
And this can provide farmers an entry gate to becoming entrepreneurs, managing all phases of his activities to include post harvest processing to market negotiations.
