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Sarangani abaca cooperative signs China supply deal

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abaca warehouse
Dried abaca is prepared for bailing at a warehouse in Sarangani. -- PRDP.DA.GOV.PH/FREDABREA

DAVAO CITY — A cooperative in Sarangani province is expanding its abaca production area to about 1,000 hectares as it started selling its products to China.

The Philippine Rural Development Project (PRDP), in an e-mail to BusinessWorld, said it is assisting the United Maligang Multi-Purpose Cooperative in Kiamba, Sarangani to maximize its output after a Chinese company ordered about 2.2 tons of its abaca products last month.

At present, the cooperative has a production area of about 600 hectares.

“They can meet the demand if abaca producers in Sarangani area consolidate,” PRDP said.

Some P35.7 million in PRDP funds will support enhanced production, processing, and marketing.

Included in the package are 74 portable stripping and dying machines for the weavers, hauling and delivery trucks, 56 heavy-duty spindle stripping machines, a pressing machine for abaca bailing and a forklift.

The PRDP is also building a processing center.

Beverly Pacquiao, treasurer of the United Maligang group, was quoted in the statement as saying that while the cooperative and the Chinese buyer still do not have final terms on the extent of its purchases, “it is an opportunity to expand our production area.”

“We were enticed to grab the trade opportunity because of the higher buying price compared to the price offered by the local market,” she added.

For the first shipment, the Chinese buyer bought about 400 kilograms (kg) of S2 fiber at P140/kg, higher than the P100/kg prevailing rate.

The other products purchased were Hank-type fiber and cake-type fiber.

Ms. Pacquiao said the cooperative, at present, can only supply about half of the eight-ton order, but she is confident that with the expansion of abaca production, it can eventually meet the requirement.

“If the construction of a warehouse and processing plant under PRDP project is completed, they will be able to produce more abaca products and definitely have more supply to sell,” PRDP said.

United Maligang is one of the cooperatives in six towns in Sarangani receiving PRDP assistance.

Abaca is among the commodities that Sarangani has identified under its Provincial Investment Commodity Plan and value-chain analysis, two requirements to qualify for PRDP assistance. — Carmelito Q. Francisco