To help guide investors who are considering venturing into farming through one model or another of consolidating small farms into bigger units to achieve economies of scale, let me summarize here the presentations of some of the resource persons who presented “models of agribusiness consolidation.  First there were Ms. Shiryle Estoque, Project Officer I, and Ronald Tejada, Project Officer II of the Farm and Fisheries  Clustering and Consolidation (F2C2) Program of the Department of Agriculture.  They describe the manner in which farmers are organized into clusters that function as business enterprises with improved bargaining power.  Eligibility for the program requires groups to be organized as juridical entities at least for one year and meet minimum production are requirements, such as 100 hectares for rice or 25 hectares for high-value crops such as vegetables or fruits.  The program facilitates credit access through an agricultural credit rating system and links clusters of farmers with institutional buyers via a “Big Brother-Small Brother” partnership arrangement.  As of December 2025, the initiative has successfully developed 1,747 clusters involving over 747,000 farmer members across more than 923,000 hectares .

              Then there was the Bondoc Peninsula Convergence Effort described by Director Bibiano Concibido, a Regional Manager  of the  Philippine Coconut Authority (PCA).  The program is private sector driven and farmer centric approach.  This convergence aligns partners like Chemrez and Leads Agri in the organization of small farmers into cooperatives and breaks the multi-layered supply chain.  Key accomplishments include assisting seven cooperatives with market integration, supporting four shared processing facilities, and establishing over 3,000 hybrid seedlings.  Additionally,  the program provides social assistance,  having insured some 4,501 farmers and identified qualified scholars for educational support.

              Hon. Rico Geron, CEO of the highly successful cooperative in Batangas Province called the Sorosoro Ibaba Development Corporation (SIDC), reported that   SIDC serves as a primary model, having grown  from a 59-member group in 1969 into a massive cooperative with total assets of Php 7.9  billion as of 2025.  SIDC works through interconnected business units such as feed mills, rice mills, and livestock units to create a circular economy in which by-products such as chicken manure and riced hulls are recycled into  certified organic fertilizers.  The Cooperative ensures market access for its members by distributing finished products such as “Golden Lay Eggs” and “Gintong Gawad” rice through its own chain of supermarkets and mini-marts.  The clustering program is supported by their own internal financing arm, KOOPINOY, providing access to credit for the farmers.

              Mr. Donnel Tiedra, Public Affairs Executive of Nestle,  gave another example of a successful clustering initiative that achieved  higher productivity at the farm level.  The NESCAFE Plan addresses the supply gap in the Philippine coffee industry, in which local production meets only 15 % of the annual requirement.  Without following the misplaced effort in the rice industry for self-sufficiency in the last century, the plan focuses on Regenerative Agriculture which consists in teaching small farmers 10 key practices such as agroforestry, rejuvenation, and intercropping (say, with coconut) to improve soil health and climate resilience.  Through Project Coffee+, partnership with GIZ, the German government’s main international development agency, and the Department of Agriculture, the participating farmers have seen their average coffee yields triple from 240 kg to 1,000 kg per hectare.  Consequently, over 80 % of the farmers successfully crossed the poverty threshold.  Nestle’s 2030 vision includes a  50 % reduction in greenhouse gas emissions, ensuring that 50% of their coffee is sourced through regenerative methods.

It is clear from this example that helping small farmers to be more productive in the Philippines is generally a means to help them escape poverty, not to attain  a quantum leap in productivity.  This can be concluded from the fact that in Vietnam, more effective means of consolidating small farms into larger units can lead to average productivity of coffee farms  of as much as  3,000 kg (3 tons) per hectare.  No wonder, Vietnam is now the second largest exporter of coffee in the world.     I cannot repeat this reality enough:  helping small farmers to be more productive is an indispensable tool to reduce the poverty incidence, a more important goal than just attaining higher GDP growth.   Accelerating GDP growth to 8 % annually, however, will require more success in land consolidation to reach significant economies of scale at the farming level. In other words, we need to apply the banana and pineapple models to more products like coffee, cacao, cashew, avocado, mangos, bamboos, pili, and durian, without neglecting the millions of small farmers who will predominate in such products as rice, corn, vegetables, high-value fruits, flowers, backyard poultry and hog farming, etc.

Session 3 featured other successful cases of consolidation.  Mr. Roberto Alingog, Chairman of  ADAMCO, discussed how the negative features of too much fragmentation can be addressed through technology rather than the actual physical merging of small  land units.  He cited the obvious example of a hand tractor or a rice combine harvester that can serve multiple farmers. This move towards mechanization (which was what Industrial Revolution 1.0 was all about) improves productivity and incomes without the need for land consolidation or physical farm merging.  He noted that manual harvesting often results in 15 % to 20% grain losses because of labor delays.  In contrast, a rice combine harvester reduces losses to approximately 5 %, significantly closing the rice supply gap.  To motivates the early adoption of expensive machinery (P 1.5 to P1.8 million), Mr. Alingog was willing to issue “personal” or “company” guarantees” to buyers, promising to return down payments if they could not recover their investment in two years.

As an aid to efficient management planning and execution, Mr. Alingog proposed an organized system covering the 7 Ps”:  Planning, Planting, Plant care, Pre-harvest, Post-harvest, Procurement and Purchase, and Pathways to the Plate.  To achieve the consolidation of information, the Government has to lead in farmer registration and collective data to help the small farmers to avoid “boom and bust” cycles.  He concluded that technology alone is insufficient:  success requires the “consolidation of technology, information, financing, and community participation.”  To be continued.