UBOD

Davao City – It may be immediately obvious, but "ubod," or heart of palm has a greater economic potential than serving merely as a common ingredient in fresh lumpia.

To take advantage of that potential, a multinational fruit company, La Frutera which is based in Datu Paglas, Maguindanao, and, which produces and exports bananas, is diversifying into heart of palm production and is now conducting field trials. It planted 5,000 palm seedlings of the Bactris species on two hectares last July, and another 10,000 seedlings on four hectares in September. It will take two years before La Frutera harvests its first batch of ubod.

The company’s foray into heart of palm production reinforces a study conducted by Dr. Lawrence Thomas Szott, an American agricultural expert, who said that heart of palm production, including processing the crop into various food products, would be profitable in Mindanao.

In his study, entitled "An assessment of palm heart production, processing and commercialization chains in Mindanao," Szott said a hectare of palm could produce $2,200-worth of ubod. This is based on a fully developed, integrated palm plantation of at least 2,000 hectares that would generate annual revenues of about $4.4 million.

Dr. Szott’s study was commissioned by USAID’s Growth with Equity in Mindanao (GEM) program, through its Targeted Commodity Expansion Program (TCEP), which is also assisting La Frutera in the ubod adaptability trial.

When it goes into full production two years from now–depending on the results of the field trials–La Frutera plans to utilize half of the five-hectare trial plantation area into a techno-demo farm, and the other half for seed production.

Sustaining the gains of peace

According to Datu Ibrahim "Toto" Paglas, CEO of La Frutera, his company’s decision to engage in heart of palm production was influenced by a conversation he had with former US Ambassador Francis Ricciardone during a visit by the latter to his community.

"Ambassador Ricciardone broached the idea for La Frutera to develop another ‘cash crop’ that would further strengthen peace and development efforts in our area," shared Paglas.

The ambassador made this comment after seeing the remarkable economic transformation of the community.

Paglas recalled the days when the town of Datu Paglas was known as a "no-man’s land" because of the numerous armed battles which erupted between government troops and rebel forces.

However, when Paglas became the mayor in 1988, everything changed. First, he challenged his constituents to turn away from the culture of violence which had hamstrung their town’s growth and development. His people listened and rallied to his call. Second, he improved the area’s infrastructure facilities and invited local and foreign businesses to invest in the area. Although wary at first, investors eventually visited and saw the huge agriculture potential of the area.

The rest, as they say, is history. The municipality of Datu Paglas is now known as the site of a thriving banana company, which exports to markets in West Asia, Japan, China and Korea. And it is worthy to note that a majority of the workers in the plantation are former combatants who have given up their guns for ploughshares.

Thus, Paglas stressed that the company’s decision to engage in heart of palm production is an effective way of sustaining peace and security in the area as this will generate more employment opportunities. "With this enterprise, we hope to create much-needed jobs for our people and thus discourage our Muslim brothers from engaging in unlawful activities," he said.

Huge export potential

In his study, Dr. Szott found that the Bactris heart of palm species, which originates from Central and South America, is suitable for Mindanao.

In upscale foreign markets, heart of palm is considered an exotic and nutritious vegetable, and is used often in gourmet dishes. It is rich in calcium, riboflavin and niacin, and has no cholesterol and is sold fresh, canned or bottled.

The Davao-based company Nenita Quality Foods is currently processing and bottling heart of palm, most of which is sold locally. However, Nenita has started to promote the product in international trade exhibits.

"Heart of palm produced in Mindanao can be very competitive in Asian and Pacific markets due to higher yields and lower processing and transport costs," Dr. Szott noted in his study. Among the potential major markets are Hong Kong, Singapore, Japan, South Korea, Taiwan, Australia, New Zealand, and Hawaii. Secondary markets include the US West Coast, Canada and Europe.

Currently, Japan and Taiwan are the most promising destinations, as they are already importing heart of palm. "Market opportunities in Australia and New Zealand are also bright because they are also major importers of heart of palm coming from Latin America," Dr. Szott added.

Among the US fruit and food companies interested in importing heart of palm are Del Monte Foods, Edwards and Sons, and Melissa’s World Variety Produce.

Major production hub

Once developed, an integrated heart of palm industry in Mindanao could generate $10 million to $21 million annually, from production, processing, handling, and shipping activities. More importantly, it could provide tens of thousands of jobs, from related enterprises such as transport, marketing, handling, suppliers of jars, cans, labels and tops, among other business opportunities, Szott noted.

Aside from Datu Paglas in Maguindanao, Wao in Lanao del Sur is another suitable site for heart of palm production, according to on-site evaluations undertaken by Dr. Szott and TCEP staff in 2004.

Dr. Szott’s study also suggested the development of an integrated effort to organize farmers and to provide them with technical assistance. Such an effort should involve the academic community, fruit processors and farmers’ organizations, who will train interested farmers in appropriate production techniques.

For his part, Paglas envisions expanding his current production area by another field trials demonstrate positive results. "Once successfully grown, the heart of palm could be appropriately called Central Mindanao’s ‘crop of peace’," he concluded.