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Northern Mindanao, in search of inclusive growth

/ 03:17 AM March 21, 2016

Northern Mindanao (Region X) comprises five provinces—Camiguin, Misamis Oriental, Lanao del Norte, Bukidnon and Misamis Occidental—and nine cities—Cagayan de Oro (CDO), El Salvador, Gingoog, Iligan, Malaybalay, Oroquieta, Ozamis, Tangub and Valencia.

Iligan and CDO, the regional center, are the largest cities. The region has close trade links with Cebu. Several roll-on-roll-off vessels operate directly to or via Bohol.

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The region covers a land area of 2.05 million hectares (ha). More than 60 percent of Northern Mindanao’s total land area is classified as forest land. The population was 4.30 million in 2010.

Agribusiness is a major activity, led by Bukidnon province. There were 303,000 ha of coconut in 2014, and harvested areas of palay reached 164,000 ha, and corn, 191,000 ha in 2015 (PSA-BAS).

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The region leads in pineapple (56 percent of total), second in coconut (12.5 percent), sugarcane (13.7 percent), and Cavendish banana (26 percent) in 2014.

It is third in corn (9.5 percent) and saba banana (11.8 percent).

Other crops of importance include rice, rubber, oil palm, coffee and highland vegetables (PSA-BAS).

Region X is the industrial heartland of Mindanao. The number of industrial plants  surpasses that of other regions on the island.

Large agriculture firms into pineapple include Del Monte Phils. Inc. (DMPI), Sumifru, Lapanday Food, DavCo, Philhybrid, and Mt. Kitanglad Agricultural Development Corp. (MKADC). DMPI is also engaged in cattle and feedlot operation.

Dole, Del Monte Fresh/Agrinanas and MKADC are into bananas. Total lands devoted to pineapples reached about 33,000 ha and 15,000 ha for Cavendish banana. DMPI has been operating in the region for 89 years.

There are two sugar mills in the region—Bukidnon Sugar Milling Corp. (BUSCO) and Crystal Sugar Milling Corp.

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BUSCO operates a  refinery.  A. Brown Resources is into palm oil, San Miguel into cassava, and Bukidnon Highland Produce is venturing into the production of asparagus.

Phil-Agro Industrial Corp. is into starch production while Japan (Phils.) Latex is into rubber latex production.

Large firms that undertake contract breeding and growing are San Miguel-Purefoods Inc., Monterey Farms Corp.  and Tyson Agro-Ventures, Inc.

The leading firms in food and beverage manufacturing include Amley Food, Asia Brewery, DMPI, Fiesta Brands, Fresh Fruits Ingredients, Liwayway/Oishi,  Pilmico  Foods, Regent Foods Corp., Republic Biscuits, Universal Robina Corp., W.L. Foods, Tanduay Distillers, Inc., and Zest-O Corp.

Related firms include Granexport Oil Milling, Highland Fresh Dairy Products, Limketkai Sons Milling., San Miguel Corp.- Iligan Coconut Oil Mill, and Wilmar Edible Oils (Phils.).

Manufacturing plants include Glaube Box Factory, Jacobi Carbon Philippines, Mindanao Container Corp., Mindanao Forge Co., Mabuhay Vinyl, Maria Cristina Chemical Industry, Mindanao Portland Cement, Philippine Sinter Corp. and Refractories Philippines.

Phividec Industrial Estate in Tagaloan, Misamis Oriental, has 23 firms ranging from cold storage, corrugated boxes, activated carbon, feedmill, and wood processing.

The Mindanao International Container Terminal is the main export exit. It has two quay crane and four rubber-tired gantries, 262 reefer stack, two berthing positions and a 9.4 ha container yard. The International Container Services Inc. (ICTSI) is the operator.  The DMPI operates a 700,000- ton of cannery in Bogo, CDO,  with dedicated container yards and a deep-dredged international seaport.

The tourism potential remains undeveloped. Bukidnon highland zipline, Cagayan River whitewater rafting, and Camiguin beaches are already on the tourist map.

Poverty incidence

While the region is home to large agribusinesses and industrial plants, poverty in the region remains high and persistent.  Between 2006 and 2012, poverty incidence hardly improved. The number of poor rose to 1.76 million from 1.55 million or an increase of 14 percent.

If Misamis Oriental (which includes urban CDO) is excluded, the poverty incidence rose to 47.9 percent from 42.5 percent, raising the number of poor by 24 percent.

Idle lands at 20,370 ha, or 2.8 percent of farm land, are the largest in the country (www.psa.gov.ph). The idle lands and so-called “forest lands” need development.

There is also tremendous potential for aquaculture in Panguil Bay, which is being developed as the region’s mudcrab capital. There are at least 2,000 ha of under-utilized ponds suitable for bangus-tiger prawn and  bangus-vannamei polyculture.

A region of contrast

Today, the region is a study in contrast: world-class banana and pineapple farms, but relatively lower yields in other crops, especially for smallholders.  Yield affects the cost of raw materials supply and the scale of agri-food manufacturing plants and, in turn, non-farm jobs.   The outcome is high poverty.

Decision-makers must attract more investments and increase farm productivity.  Small farms need consolidation under central management to achieve scale in support services, such as irrigation, input supply, farm mechanization, processing and marketing.

This must be complemented by peaceful dialogue among parties as external (non-Mindanao-based) investors are wary of security concerns.

Finally, it is equally important to balance development across provinces to promote inclusive growth.

(The article reflects the personal opinion of the author and does not reflect the official stand of the Management Association of the Philippines or MAP.  The author is vice chair of the MAP AgriBusiness and Countryside Development Committee, and executive director of the Center for Food and AgriBusiness of the University of Asia & the Pacific. Feedback at <[email protected]> and <[email protected]>.  For previous articles, please visit <map.org.ph>)

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