More RP fruits to enter China market next year

DAVAO CITY — Although admitting that the prospect of exporting more fruits and other agricultural products to China is well enticing, Land Bank of the Philippines chairman and Quedan Rural and Credit Guarantee Corp (Quedancor) head Luis Lorenzo says the Philippine government is still studying carefully the terms of the free trade agreement (FTA) that will allow the country to avail of China’s Early Harvest Program (EHP).

Lorenzo, who was keynote speaker at the recent 4th Mindanao Fruit Industry Conference, said "the Philippines agreed to avail of the program with a very keen interest to monitor and control ability to import so we don’t have a deluge of imported products from China." The two countries are finalizing the agreement which is expected to take effect next year.

The Early Harvest program FTA is expected to reduce and gradually eliminate tariff rates on agreed products traded between both countries at the start of 2005. At present, imported fruits from the Philippines are taxed 17 percent by the Chinese government while products from Thailand and Malaysia, which had earlier availed of the EHP enter China tax-free.

RP Fruits A Hit In China

Fruit subnetwork team leader of the Bureau of Agricultural Research and University of Southern Mindanao professor Pablito Pamplona said Chinese importers and government officials are interested in importing banana, mango, mangosteen, longkong on a year round basis from the Philippines and pomelo, papaya, and melon on a seasonal basis.

Pamplona was part of the study team that visited China last April to determine the prospects for Philippine fruits. The team visited Guangzhou, Donguan, and Shenzhen – cities within the China Special Economic Zone.

Chinese traders are looking at the country as a major supplier of tropical fruits, he said. With a population of about 1.3 billion and a growth rate of 8.9 percent, China is considered an emerging economic giant and the world's biggest importer of agricultural products.

Last year, the country's income from mango exports reached $59.4 million, up by almost 66 percent from $35.8 million in 2002. China contributed $504,000 of the total figure, a 24 percent rise from its 2002 imports pegged at $405,387, data from Bureau of Agricultural Statistics (BAS) further showed.

In 2002, Mindanao accounted for 30 percent of the country’s 1 million metric ton mango production. About 4 percent of the country’s total harvest was shipped out during the said period.

Fresh banana and banana chips from the country are also a favorite among Chinese nationals who imported $357.3 million in fresh and processed banana from the Philippines last year. Mindanao supplies at least 47 percent of the country’s total banana production.

Meeting Opportunities

To strengthen the country’s foothold in the China market, a more intensified promotion of off-season mango production and exportation is needed. This technology allows growers to harvest during "off season"which starts at the second half of the year. With this, Mindanao farmers can grow mangoes almost all year round.

The Mindanao Fruit Industry (MinFruit) Council, which organized the conference has been training farmers in off season mango production with help from the Department of Agriculture (DA) and the USAID-funded Growth with Equity in Mindanao. According to Minfruit Council President Antonio Partoza, more than 600 hectares have been covered by the initiative.

MinFruits has conducted seventeen trainings attended by more than 1,000 participants. At least 2,000 metric tons of "off-season" mangoes have been produced adopting the technology all throughout Mindanao, including the conflict-affected areas.

There are also plans to expand the area planted to carabao mango in Mindanao from the current 35,000 hectares to at least 140,000 hectares.

To introduce durian exportation to China, farmers are mulling to harvest from August to November when commercial production in Thailand is low. But in order to compete globally, there should be a concerted effort to lower the prices of pesticides and fertilizers which increase production cost.

In a bid to increase regional fruit exports to China and other big markets, MinFruit Council has also drafted an action plan for next year which seeks to improve the supply chain for various fruit commodities.

Minfruit, which boasts about 36 fruits growers’ cooperatives, associations, councils, corporate farms, and marketing organizations, serves as the advocacy and advisory body of the private sector to the government and other sectors. It aims to lead and collaborate with growers and member-associations for the synchronized responsible production and delivery of consistently high-valued fruits to both the domestic and international markets.

For the improvement of the cardaba banana industry, the council is collaborating with key grower associations to implement initiatives for the improvement of the supply chain, as well as provide technical assistance and develop quality improvement training for selected banana chip factories.

Minfruit is also working to expand grower partnership schemes for mango with fruit giant Dole and other interested exporters and processors.

Stakeholders of the fruit industry also committed to focus on exotic banana varieties namely Lakatan, Señorita and Latundan which are considered as potential export winners. Romeo Serra, Mindanao Business Council (MBC) regional governor and a banana grower himself said the full market potential of Lakatan is hamstrung by problems in marketing and production. He proposed the Middle East and neighboring Asian nations as possible markets.

Minfruit will also undertake various programs on improving production, post harvest, storage and shipment technologies next year, as well as market promotion activities in key markets such as Metro Manila and Cebu.

Improved production technologies and better market linkages between growers and traders of pomelo, mangosteen, papaya and calamansi will also be implemented to increase production and improve competitiveness.

But more than increasing hectarage and volume of tropical fruits for export, Mindanao growers must strive to increase product quality and competitiveness, GEM Program Manager John Dalton said in his speech at the conference. Dalton, who vowed to work with the government and other sectors to promote Mindanao competitiveness, announced that a team of experts will be coming over to the region to look at selected products and fruits capable of capturing the huge China market.

"This year, 2004, is good for the fruit industry. In the first three quarters we saw an increase in exports from fresh to processed fruits. This is a sign of good things to come. I assure you that GEM will continue to be a partner toward Mindanao’s vibrant and successful economy," Dalton said in his speech at the opening of the conference.