A new source of Cocoa Beans:

Over last 2000 years Philippines important in SE Asian trading along the ancient Nan Hai Trade Route

Source: Ayala Found Inc

From Mindanao many natural resources were highly sought

Source: Ayala Found Inc

Forest products

National Geo photos

Nowwe can add Cocao Products to future shopping lists of Asian neighbours.

MARS INC

Our last Cacao Industry Conference April 2011 resulted in:

Agreement on Cacao 2020 Challenge Formation of CIDAMi Great increase in investment and interest in cacao production and processing, especially in Mindanao

2020 Cacao Challenge: From 7000 to 100,000 t by 2020

Timeline of Cacao Production, in Philippines, in tonnes since 1950

2020 2009 1990 1980 1960 1950

100,000 6,000 10,000 20,000 2,000 500

Look at 2020 Challenge in terms of:

GREEN paper: future growth and needs in 2020 WHITE paper: our industry situation today
AND.

Domestic, Regional and Global Markets for Cocoa

Panel Session #1
EXPLORING REGIONAL AND GLOBAL MARKETS FOR MINDANAOS 2020 CACAO ECONOMY

Our Speakers and Topics

Panelist 1: Daniel Liew Armajaro, KL Sdn Bhd Trends in supply and demand. Panelist 2: Dr Chow Bee Yee, MARS Inc, Malaysia. Mindanao cacao brand positioning Panelist 3: Dr Gil Yarra, Chocolate de San Isidro Inc , DDN Mindanao Mindanao as a leader for Cocoa in Philippines

The Development Landscape for Cacao in Mindanao

18 % of national GDP 11% of ODA 24% of population Poverty incidence >40% high population growth rate of 2% annually Continuing conflict and issues: Muslims, Christians and Indigenous peoples A history of land and natural resources abuse

But so many good things happening..

Gradual restoration of peace and order in many conflicted parts of Mindanao Development booms around the major cities and urban areas Diverse and proven natural resources still exist Strategic location for SE Asia with several large ports A food and fisheries basket, that grows in size each year

Mindanao 2020: Peace and Development Framework Plan 2011-2030

Agriculture and agriculture-based industries will continue to be the most prominent driver of the Mindanao economy well into the future, for inherent reasons. The optimum balance between large plantation agriculture and smallholder farming needs to be sought, for reasons of both social inclusiveness and environmental sustainability.

MINDANAO is mostly: no typhoons Well distributed rainfall High to medium levels of rainfall

PAGASA

PCA: Coconut Areas by Region (in Ha.)

CARAGA 227,480 has.
500,000 450,000

Region X 216,310 has. Region IX 369,130 has.

400,000 350,000 300,000

Has.

250,000 200,000 150,000 100,000 50,000 0

XI

IX

C A R A GA A R M M

XII

Region

ARMM - 223,150 has. Region XI - 460,700 has. Region XII 98,350 has.

Total Coconuts land Area 1,595,120 ha.

Message 1: The Virtues of producing cocoa in Mindanao

Its great in diversified farming systems

Cocoa is SMALLHOLDER friendly

It offers good income from rapidly expanding domestic and export markets

Its agro-forestry compatible

Large areas of land suitable for intercropping ie coconut farms

source PCA region XI

Mindanao

1,911,360 ha

Southern Mindanao - 379,865 ha

Slide-2

The market is ready and willing (PT Olam Ltd slide)

The status of cocoa in the Philippines

About 6000 tonnes produced annually, 80% from Mindanao Is a smallholder farmer industry Mostly organic by neglect Represents about 0.16% of world production An area of about 12,000 hectares and about 20,000 farmers Domestic market deficit is about 30,000 tonnes per year of cocoa bean equivalents

Specific opportunities in Mindanao

Large areas of idle coconut lands ready for interplanting >1,000,000 hectares Significant areas of old cocoa plantings for rehabilitation, can show fast return on investment Possible certified organic cocoa production based on the long period of low or no inputs Large scale nurseries and bud wood garden operations needed now The domestic market is vastly undersupplied from local producers Cocoa production and export is competitive with other major crops

Village Technology & Extension Farm

Post Harvest Facilties

Farmers Field School & extension services Plant Material Supply Facilities

Agri-Enterprise Development

Organic Inputs Facilities

Daghang salamat