Short Supply of Nuts Threatens Pili Exports - Malaya

NAGA CITY – A scarcity of pili nuts threatens a rapidly growing export industry.

A pili tree.
"The scant supply is due to the decreasing number of pili trees," said Lydia Lomibao who, together with her husband Joseph, turned a backyard business with an initial capital of P500 in 1997 into a P10 million business today.

The Lomibaos own and manage J. Emmanuel Pastries and source their nuts from the 105-hectare Hacienda de Naga. But they are worried enough to plant seven hectares of their own land to pili trees.

"Raw material supply is dwindling because farmers have little knowledge of the value and potential of pili-based products," she told Malaya Business Insight. "I am confident, however, that we can still manage the volume of raw materials for our present needs, which is about 120 kilos of raw nuts a day."

Lomibao said there are only two companies, one being J. Emmanuel Pastries, currently exporting pili products. J. Emmanuel Pastries sells its products to the United States, Japan, China, Canada and Guam.

Its product line includes roasted pili nut and pili coated with honey or garlic. Aggressive marketing in malls has expanded its three outlets to 30 in Southern Luzon, Cebu and Metro Manila, boosting sales by 30 percent and accounting for half of gross sales. Sales in airport and hotel outlets account for 10 percent.

"It took us one year before getting our first order in 2008 from the US, only to suffer during the recession there. Orders stopped last September and were renewed only this March," she said.

"Pili has been there all the time, but it’s only now that we are seeing substantial exports," said Lomibao. "When we started we had zero technology, until we turned to the SET-UP program of the Department of Science and Technology (DOST) to upgrade our equipment and bring our processes up to standard."

SET-UP stands for Small Enterprise Technology Upgrading Program that encourages and assists small and medium enterprises to adopt technology innovations and improve their operations and boost productivity and competitiveness.

The program enables small firms to address technical problems through technology transfer and interventions and improve productivity through better product quality, human resources development, cost minimization and waste management.

Six priority areas are covered by SET-UP: food processing; furniture; gifts, decors and handicrafts; marine and aquatic resources; horticulture (cut flowers, fruits and high-value crops); and metals and engineering.

"They availed of P310,000 in SET-UP loans for processing and packaging equipment, with free training on good manufacturing practices, including cleaner production technology," said engineer Ernesto Reyes Jr., a senior science specialist at the DOST Camarines Sur office.

The "clean" technology was the gasifier combuster designed by the DOST Industrial Technology Development Institute. The combuster, instead of using rice hull it was designed for, burns and converts pili shells and stela (skin) into an LPG-like gas which heats the oven used to cook pili pastries.

"Because of the combuster, they have zero waste in processing," Reyes said, adding that the loan availed in 2004 was fully paid by 2007.

The pili tree is abundant and wild in southern Luzon, particularly in Bicol, and in parts of the Visayas and Mindanao. A 300 hectare farm in Negros Occidental, for example, is planted to 60,000 pili trees.

The trees, which are difficult to propagate, are collected from natural stands. They are harvested in Albay (3,750 hectares), Camarines Norte (150 hectares), Camarines Sur (600 hectares), Catanduanes (150 hectares) and Sorsogon (350 hectares).

While pili is indigenous to Southeast Asia, the Philippines has a monopoly in the world market because it is the only one which processes the nut commercially. In other countries, the tree is an ornamental.

This year, the Department of Agriculture (DA) budgeted P150 million for marketing, research and development and the replanting of seven pili varieties in Bicol, which accounts for 80 percent of national production. A Pili Research and Training Center is based in Guinobatan, Albay.

The DA expects the number pili trees to increase three-fold when over 600,000 seedlings distributed since 2000 for the establishment of pili orchards bear fruit. Areas planted for pili rose 29.3 percent to 7,046.5 hectares in July 2006 from 5,449 hectares in July 2000.

Pili provides income to some 13,435 farmers who own at least 10 trees as well as laborers hired as harvesters. The nut does not require costly storage treatment and, when properly dried, can be stored for one year under ordinary room conditions.

By Paul M. Icamina
Source: Business Insight, Malaya - 01 December 2009

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