Let’s use our coconuts to increase jobs, incomes

Amid the rosy reports on the economy’s expansion in 2012 and 2013, one senses dismay over the lack of growth in jobs and incomes as well as the widening gap between the rich and the poor.

A particularly worrying scenario is playing out in the countryside, where the bulk of poverty incidence exists. Let’s take the case of the coconut-producing areas, which account for about a quarter of the Philippines’ population. Around five years ago, the price of copra was at the P50-per-kilo level. Coconut farmers were ecstatic.

Today, the price hovers around the P10-mark.

Given a national production average of 1,000 kilos of copra in one hectare of coconut land, a typical farm family is currently earning about P10,000 a year. That’s P833 a month, or less than P30 per day! Even if some intercropping and side jobs enable the doubling of a family’s daily income to P60, that amount will still not suffice to keep body and soul together.

This dire situation need not, and should not, prevail.

After almost 30 years of litigation, the coconut levy funds are ready for spending. Last year, the Supreme Court declared with finality as “public funds” some 24 percent of San Miguel Corp. shares of stocks that had been acquired with the use of the coconut levy collected under several decrees of President Ferdinand Marcos. Very recently, the high court also ruled that the United Coconut Planters Bank shares of stock of Eduardo “Danding” Cojuangco Jr. and several others had been illegally acquired using the coconut levy collections.

The proceeds from the subsequent sale of the government’s SMC shares, which total about P70 billion (including accrued interest) are now held in trust by the national treasury for the benefit—as mandated by law—of the coconut farmers and the entire coconut industry. Many more billions of pesos are expected to enter the government coffers should plans to sell the UCPB, the various oil mills and other companies and assets acquired through the coconut levy materialize.

This huge resource, if coupled with innovative approaches to develop the industry, can bring about a radical transformation in the coconut sector and the country as a whole.

An idea that has been gaining ground is that farmers should no longer focus on copra (dried coconut meat) as their main product. The reason is that reliance on copra and its main derivative—crude coconut oil—is a prescription for perpetuating poverty and joblessness in coconut areas. This is not only because coconut oil is a minor player and price taker in the global market for vegetable oils, but also because many other valuable parts and features of the coconut are being ignored or wasted.

One initiative has been dubbed as the “fresh coconut” (Fresco) industry development approach. Unlike in the traditional setup, where farmers concentrate on just producing copra, the Fresco model will empower the coconut farmer by developing and processing the coconut in its entirety.

Out of the coconut husk will emerge antisoil erosion nets, soil-conditioning peat, and durable plant pots. The coconut shell will be the raw material for activated carbon.

Water from the mature coconut is a rich source of minerals, amino acids and vitamins. Coconut farmers and their families should be encouraged to drink it or use it for their cooking needs. Mature-coconut water can also be processed into natural sports/isotonic beverages more nutritious than the synthetic drinks now monopolizing the market. Alternatively, simple boiling will convert this same water into a concentrate more nutritious and tasty than soy or oyster sauce.

Furthermore, the white liquid called gata (derived from squeezing fresh coconut meat) contains 30-40 percent oil, which can be extracted as fresh or virgin coconut oil for cooking, beauty and health care, and other uses. The remaining oil-free or skimmed coconut milk can be made into highly nutritious and delicious lactose-free drink, ice cream, butter, cheese and other dairy products. The residual sapal can be processed into coconut flour.

Under the Fresco model, these various outputs from the whole coconut will be produced by a national network of farmer-owned processing plants at the village or municipal level. It will not be unrealistic to project that incomes and job opportunities for farmers and other rural residents will be multiplied many times. The program’s positive impacts on the war against poverty  (and malnutrition) will be huge and sustainable.

Utilizing the coconut levy funds now in the government’s hands for this purpose will therefore be money wisely invested for the benefit of coconut farmers and the entire Filipino people.

Leonardo Q. Montemayor is the president of the Federation of Free Farmers. He was agriculture secretary and also board chair of the Philippine Coconut Authority in 2001-2002.