Report: Diversification and Value Addition for Agri Products Training, 3-9 October 2011, Sri Lanka

Group Photo of Participants

BRIEF DESCRIPTION / BACKGROUND OF THE PROJECT

The agriculture sector continues to have a significant share of the gross domestic products and provides employment to greater number of the labor force particularly in the rural areas. Thus, most economic activities and poverty alleviation measures in those areas are inherently linked to agriculture. But farm incomes remain low, hence poverty in rural areas remain a serious issue. One reason for this is the limited diversification and value-adding activities in those areas and the majority of farmers and other players in the agriculture product supply chain hardly optimize value addition in the process of moving the raw materials from the farm to the consumers. This is apparently due to the inadequacy of knowledge of various value-adding technologies, and lack of awareness on the potential market opportunities for diverse range of products produced from value added agriculture raw materials.

Product diversification and value addition to agricultural products has tremendous potential for increasing productivity, incomes, and off-farm employment opportunities in rural areas. These are strategies which can make intensive use of both human resources and local agricultural raw materials. Innovation is the key to product diversification and value addition. This may involve the enhancement of a product through packaging, efficient post-harvest handling, and processing. Some examples of innovative products are those delivering a unique combination of functional, nutritional, economical, and sustainable benefits to customers. Other product innovations are those that add new flavor, texture, shape, and scent or extension of the product range resulting in multiple uses to meet the requirements of various consumer segments and capture new markets. Innovations could also improve food quality and safety and reduce consumer efforts in benefiting from the intended use of the products. There is therefore a need to provide appropriate training to different players in the agricultural product supply chain on various aspects of product diversification and value addition. This could catalyze more value adding activities, especially in rural areas, to utilize excessive labor and abundant raw materials on farms which can be transformed into various food and other consumer products of greater value.

OBJECTIVES OF THE PROJECT

1)  To enhance participants’ understanding of the importance of agricultural product diversification, value addition, and innovation to optimize income from agricultural activities; and

2)  To equip participants with knowledge of the different approaches and techniques in adding value to agricultural products through various innovative approaches.

OBJECTIVES FOR PARTICIPATION

Being the president of Leonie Agri Corporation (LAC), at the same time, vice-president and chief innovations officer of Pascual Laboratoies Inc, I would like to come out with strategies which can sustain our pioneering works in herbal medicine and bio-diversified organic agriculture, and in creating shared values within our supply network thru sustainable environmental and pro-poor programs. As much as possible, these will make use of both local human resources and agricultural outputs in catalyzing more value adding activities, especially in rural areas. Moreover, I want to find ways how to convert products, by-products and co-products of farms using natural and environment friendly methods into various consumer products of greater value.

I hope to partner with other potential experts in developing local capabilities through synergy and collaboration. I would use the knowledge that I learned from the training as inputs to the joint strategic planning session of LAC and The Nature Group (a non-government organization) in building the infrastructure of organic food supply chain and increasing market awareness about healthier food alternatives. We will survey the needs of the market and develop high value products that will address a void in the market. The ideas and the new global network I gained during the training will be beneficial in intensifying the product research and development and in forging relevant alliances, particularly to develop new herbal medicine and bio-functional products.

PROFILE OF PARTICIPANTS

The following countries were represented in the APO training: Cambodia (1), Republic of China/Taiwan (1), IR Iran (1), India (2), Indonesia (2), Malaysia (1), Mongolia (1), Nepal (1), Pakistan (2), Philippines (1), Sri Lanka (6), Thailand (4), and Vietnam (1);

SCOPE, CONTENT, METHODOLOGY

The course consist of the presentation of resource papers clustered into modules, workshops, hands-on training, and field studies. The main topics covered in each module are:

Module 1 – New Food Product Development;
Module 2 – High Quality Foods/ Luxurious Foods;
Module 3 – Functional/Nutraceutical Foods;
Module 4 – Convenient Foods;
Module 5 – Food products with natural ingredients, and Food Ingredients derived from by-products/wastes – Value Addition;
Module 6 – Packaging and Labeling;
Module 7 – Emerging Global trends in New and Value added Products with successful stories;
Module 8 – Commercialization of new and value added food products in Sri Lanka (Case study);
Module 9 – Food Trade, Safety and Innovation: Thailand Perspectives.

OUTCOMES AND EVALUATION

The insights presented by the trainers: Dr. Navam Hettiarachchy, Dr. Darunee Edwards and Dr. D.K. Sarananda, and the deliberations by the participants were very helpful in stirring new ideas for value creation and inspiring the entrepreneurial spirit of the class. According to what the speakers shared, the various innovations being done in the US, Thailand and Sri Lanka are very timely and appropriate. Although much of their perspectives were into food production, I gained many ideas that could be implemented in the pharmaceutical and other industries as well. As I spoke during the workshop’s graduation ceremony, I believe that any worthwhile innovative product is always a result of noble intention, sincere effort, intelligent direction and skillful execution. Thus, I wish to implement the new knowledge in my work and carry out some of ideas when I pursue my own business in the future.

RECOMMENDATIONS AND ACTION STEPS

I recommend that the government sector should institute a multi-sectoral collaboration on food research and development. Our country could become a big player in advocating food safety and be self sufficient in rice, and other food crops by 2020. Like that of Thailand, many of their food scientists were graduates of IRRI and Unversity of the Philippines. But, other countries were able to level up their R&D works and commercially implement the production of high value agricultural crops. I believe that the Philippines has the resources to develop high value added agricultural products. Clear vision and strong leadership are needed to move forward. Now that the Organic Agriculture Act has been approved, there should be a partnership between private sector, Department of Agriculture and non-government organizations in extensively creating the awareness about organic food and building the market segment. Government should seriously implement RA10068 and grant incentives to those involved in its value creation. It should also utilize other government agencies to support the Department of Agriculture in moving this law forward.

There should be a government agency that should lead in forming/forging strategic alliances of government agencies, academe and private sector in order to have a unified or integrated approach in establishing important multi-industry projects, which are related to agriculture. This agency should also consider finding ways to convert the by-products/wastes of the agriculture sector into something useful and high value. The examples are nutriceuticals, traditional herbal medicines, green technology, plant extracts as replacement of chemical solvents, bio-fuel, etc).

Action Plans for LAC and PascualLab are the following:

1. Present relevant topics to my staff in LAC – starting October 15
2. Share the insight to The Nature Group – October 22, 29 and November 5.
3. Incorporate the applicable ideas to the strategic planning sessions of: LAC & TNG on October 22, 29 and November 5; PascualLab’s Supply Group on November 24 & 25;
4. Implement the appropriate and approved plans.
5. Present suitable topics about Food Quality and Safety to the National Organic Agriculture Conference of Department of Agriculture on November 8 to 11 at Hacienda Luisita.
6. Submit report and recommendation to the Development Academy of the Philippines on November 10.
7. Share suitable topics to the Development Academy of the Philippines.

SUBMITTED BY:

GUILLERMO F. SARET JR.
President
Leony Agri Corporation

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