An exciting agribusiness prospect has been discovered in the most recent Asia CEO Awards in the area of  “The Most Innovative Company of the Year”.  I am referring to a start up in Batangas called Pili AdeSeal Inc. , a green technology company that manufactures sealants for airplanes and for other construction purposes from the resins taken from the Pili tree grown abundantly in the Bicol region.  Founded by Engr. Mark Kennedy Bantugon, this two-year old enterprise obtained one of the 40 Global Startup Teams being chosen for this year’s K-Startup Grand Challenge 2024, a global acceleration program aimed at supporting non-Korean startups for their exploration of opportunities and application to the Asia market, specifically in South Korea.  This brings up again the great importance of diversifying our plantation economy from bananas, pineapples and coconuts to new crops like the Pili tree which also has tremendous prospects to be the new macademia nut product of the future.  There are other parts of the majestic Pili tree that can be manufactured into other construction materials and biofuels.

 As already mentioned in previous articles, Philippine manufacturing can be given a big boost if we our able to also grow large volumes of bamboo that can be manufactured into construction materials that can take the place of steel in some applications.  Former Secretary of Agriculture, Luis (Sito) Lorenzo, is already investing in this technology and thus promoting massive plantations of bamboos in Bukidnon and South Cotabato and encouraging others to produce bamboo raw materials large-scale in other provinces like Laguna, Pangasinan, Bataan, Samar, Leyte, and Mindoro. The increased industrialization of agriculture can definitely help the economy increase employment in manufacturing to the desired level of at least 18% of labor force, from its current low level of 8%.

 It is also worth pointing out that although the percentage of manufacturing in GDP and its contribution to the labor force are not always directly correlated, today manufacturing of food and beverage contributes a whopping 52% to the total value added in manufacturing. Already food manufacturing is a major force in Philippine industrialization.  It can contribute even more to both employment and value added if we resolve the problem of land consolidation that will permit more large-scale growing of all types of food crops beyond bananas and pineapples. 

In a blog post entitled Status of the Bamboo Industry in the Philippines, Lauro Braganza describes the business opportunities that bamboo planting can provide for both small farmers and large-scale agribusiness ventures.  It is widely known that bamboo is versatile and has numerous uses that can be exploited economically.  The most obvious uses are in construction which will be one of the leading growth sectors in the coming years as the Government intensifies the Build, Build, Build program started during the Duterte Administration.  In private construction, there is the constant reference to the need to build an additional one million units of housing every year.  Given the right design, bamboos will be in great demand for private housing because bamboo-based products can be used for flooring, wall panels and furniture, among others.  In addition to its widespread use in construction, bamboo can also be part of the solution to the primordial goal of food security because it can be used as a food source, with young shoots being a delicacy in many Asian countries.  With the increasing concern about air pollution as the country industrializes, bamboo can gain more popularity for its air purification properties.

It is the duty of the Government to give full support to the small bamboo farmers, especially as regards research development, policy support and market accessibility.  Both government and NGOs can assist the small farmers to adopt proper management practices such as soil preparation, irrigation, pest control, and harvesting techniques.  Small farmers can also be helped to grow different varieties of bamboo that can cater to various market demands ranging from construction materials to furniture and handicrafts.  They can be helped to organize cooperatives so that they can attain economies of scale in farming, financing, and marketing. As in the case of other farm products like rice, corn, vegetable and livestock, assisting small farmers is an effective way of eradicating poverty but  not a means of attaining significant increases in productivity, which can only  be reached through economies of scale in  commercial farms or plantations.

As long as the Government is able to gather enough political will to reverse the land fragmentation that resulted from a poorly implemented agrarian reform program, there can be private entrepreneurs who will be willing to invest  significant funds in large-scale bamboo plantations, as had happened in the banana and pineapple industries in the last century and is happening to the coconut sector thanks to the pioneering work of such agribusiness ventures as Axelum, Lionheart Farms and ,more recently the First Pacific Agribusiness Ventures of Manny Pangilinan.  An exciting prospect that will encourage more large-scale planting of bamboos has arisen from an investment by former Secretary of Agriculture Luis Lorenzo in a global corporation called Rizome Philippines.  The joint venture with Lorenzo’s Bamboo Ecologic Export Corp (BEEP) will bring in as much as $100 million that will be invested in a manufacturing plant in Cagayan de Oro that will produce panels, boards, veneers, and strand woven made of giant asper bamboo.  Rizome exports the manufactured bamboo products to Original Equipment Manufacturers (OEM) in America, Europe, the Middle East, Africa and the Asia Pacific region.  At present, Rizome will be sourcing their raw materials from agrarian reform beneficiaries.  It is highly likely, though, that there will be conglomerates with large capital that will be encouraged to invest in bamboo plantations that are already happening in the provinces of Pangasinan, Laguna,and  Bukidnon.

Another very exciting large-scale planting of bamboo is happening in the Province of Lanao del Sur where the poverty incidence can rise to more than 50%.  It is contiguous to more prosperous Bukidnon but has not received any notable local or foreign investment.  Thanks to a large-scale bamboo planting on denuded forests by a U.S. multinational corporation, Ecoplanet Bamboo, some 8,360 hectares of degraded mountain lands are being reforested with bamboos and other trees.  This nature-based solution project combines the reforestation of approximately 6,500 hectares with integrated native giant bamboo, Dendrocalamus asper and multiple native trees with the protection and conservation of an additional 500 hectares of remaining forest patches. EcoPlanet Bamboo is the only global entity to have delivered fully verified carbon offsets from bamboo.  

As mentioned at the beginning of this article, a start-up in Batangas has started manufacturing sealants for airplanes and for other uses in construction from the resins harvested from Pili trees. Now that he is Senate President, Senator Chiz Escudero can push more aggressively the expansion of Pili nut production in  his  Bicol region.  In a manner similar to the coconut industry, Pili trees can be grown by small farmers on a contract growing arrangement with the manufacturers, especially of confectioneries that can compete with macademia nuts in the global market.  More importantly, with the right incentives, large agribusiness ventures—both domestic and foreign—can be persuaded to consolidate thousands of hectares of land in the Bicol region so that they can reach economies of scale in planting pili trees.  This can be done through the cooperative system, the nucleus estate model of consolidating small farms through a lease arrangement, or through a long-term lease of public lands from the DENR.  Before we even talk about joining the Industrial Revolution 4.0., let us complete the pre-requisite to all the stages of industrialization which is the food security or green revolution.  Helping the farmers to be more productive in pili production in the Bicol region is a most effective means of poverty eradication.  The only way, however, to address the goal of a quantum leap in agricultural productivity is land consolidation and the application of high-tech solutions not only to farming but to the entire agribusiness supply chain such as cold storage and transport.  It is comforting to see Philippine conglomerates beginning to invest in large-scale agribusiness ventures.  It will not be long before FDIs will follow suit and also invest long-term capital into this most important sector of the economy, as Rizome and Ecoplanet Bamboo are already doing.    For comments, my email address is bernardo.villegas@uap.asia.