The coconut industry has plenty of opportunities that one can take advantage of in order to generate higher income due to its abundance in the Philippines. One factor that has considerably affected the industry is the recession on the market value of dried coconut or copra and lower buying price against its production cost.
In March 2017, a group of five goal-oriented professionals founded an agri-business venture called the Trunk to Gold (T2G), deemed at addressing the stagnant growth of the coconut industry in Misamis Oriental. This initiative aims to improve coconut productivity and to provide opportunities for local farmers through the production of value-added products like coco sugar, aminos, coco vinegar, and vegan honey from coconut sap as alternatives for copra.
Like any other business endeavor, the organization has a big vision but the market is the missing link. T2G has experienced a cash flow crisis due to heavy inventory during its initial years of operation. The inventory turnover was very slow, nonetheless it strongly held on to its principle of paying cash to coco tappers and farmers
T2G’s cocosugar on its way to GlowCorp.
While T2G was in the process of understanding its markets, Joel Zamayla, president of the enterprise explored markets possibilities to prevent from making losses. A common friend has introduced GlowCorp to T2G. GlowCorp has been known to help local farmers alleviate their livelihood situations by linking social enterprises to mainstream markets. Follow-up negotiations were made, convincing GlowCorp that T2G will not only benefit the shareholders but also the 40 farmers who depend on the company.
GlowCorp started buying from T2G in 2017 with the initial order of 400 kilograms amounting to Php68,000.00 or just 2% of the GlowCorp’s total coco-sugar purchases. In 2018, it increased to 10.7 metric tons amounting to Php1.8M with the increase of 2,575% over the previous year. Additionally, the purchase from T2G represented 30% of the total GlowCorp coco sugar purchases. The year 2019 sets another milestone for T2G as it delivered 14 metric tons to GlowCorp amounting to Php2.5M or about 32% of the company’s total coco sugar purchases.
Starting from the Scratch
Coconut business is quite lucrative with the right kind of tools. Technically, T2G brought out the venture without the experience in coco sugar processing. Before they made the decision, they comprehensively understood their market preferences, its market potentials, other businesses within
Mr. Joel Zamayla, T2G President is showing the old processing plant where they originally produced cocosugar. He also discussed with visitors and tappers how T2G started.
the market, and what the demand of their products were. They started with only Php100,000.00 as working capital. The 5 shareholders shared this amount so that the company had to start the operation, according to Gemma Emata, T2G’s Managing Director. This was not enough to pay the workers, she added.
Diversification and Future Plans
Although cocosugar is the primary product of T2G, there are other by-products that can be produced out of coconut sap. According to Zamayla, aminos or the coco sauce, coco vinegar and vegan honey also have market potential. They are now producing these products in controlled quantities and now introducing these in the local and online markets. T2G expects to sustain its partnership with GlowCorp for its coco sugar so that they can support more coconut farmers. He said that GlowCorp has helped the business grow and the community as well. T2G is now directly providing livelihood to 46 coconut farmers and workers: six (6) processors, thirty (30) toddy tappers or “mananggete” and ten (10) coconut farmers.
“The shareholders have great plans for T2G. Despite the challenges we are experiencing during this COVID pandemic, there is still silver lining that is happening right now. With the support of development partners and the local farmers, we would like to expand our agri-business, increase our production for the wholesale markets particularly GlowCorp and also bring our products directly to the consumers’ doorsteps”, Zamayla said.
“With meager initial capital, we were only able to construct a makeshift processing center made of light materials. Cook, tappers, and even friendly dogs are free to roam within the processing center”. Bernie Berondo, General Manager of GlowCorp commented that T2G needs to level-up if they want to remain competitive. Moreover, T2G needs to upgrade its processing plants as well as the whole process of the coco sugar production to be at par with the other GlowCorp suppliers.
The processors and owners of T2G underwent training on Good Manufacturing Practices (GMP) sponsored by GlowCorp and the Peace and Equity Foundation (PEF) in 2018. As a result, it helped T2G improved their coco sugar production techniques. To this date, the production workers are now practicing GMP. The Food and Drug Administration has already evaluated the processing facility of T2G. They are expecting to get the coveted License to Operate (LTO) very soon.
T2G’s Contribution to Coconut Farmers and the Community
T2G’s business has brought a meaningful and fruitful impact to the lives of the marginalized sectors in the local economy. More than 46 direct employment has been created as well as improving the productivity of coconuts in the area. The construction of the new processing plant also provided livelihoods to 15 construction workers. From the makeshift processing area, T2G has transferred to a new processing plant that is compliant to Good Manufacturing Practices (GMP) standards. T2G continuously employs 46 workers in its new plant and hope to increase its workers in the near future.
We also become a source of inspiration to other farmer communities. Farmers of the Panganuran Tribal Farmers Association from Gutalac, Zamboanga del Norte visited us and learned from our experience. Zamboanga del Norte is also one of the coconut producing provinces in the Philippines. Coconut farmers from the province also struggle to survive because of the very low price of copra and coconut sugar is one alternative product they are looking at to improve their income. We hope they learn from us, Emata proudly said.
Groundbreaking of T2G’s new processing facility. The event was attended by the T2G shareholders, processors, tappers, farmers and GlowCorp.
T2G’s track record and partnership with GlowCorp has opened doors of opportunities and attracted other partnerships with funding agencies like the Agricultural Credit Policy Council (ACPC), Department of Agriculture’s credit arm, which is now processing a zero interest loan to support T2G’s expansion. Recently, the company received a zero interest loan from DOST for the upgrading of their processing facility, which will help them get the needed License to Operate (LTO) from FDA.
Our efforts and sacrifices are coming into fruition. Despite the challenges of establishing a social enterprise such as T2G, we will continue to exist, operate and bring positive developments to our company and especially to the coconut industry that is one of the most economically deprived sectors of the society”, Zamayla stated.
Congratulations!