Agribusiness firm Vitarich Corp will work with farmers in the Philippines and the country's Department of Agriculture (DA) to process corn supply at its new feed mill in Davao City, Business World reports.
The DA and Vitarich's technical teams are currently drafting a memorandum of agreement, which could be signed in the first quarter of 2017, DA Davao Region Director Ricardo M. Oñate, Jr. comments. "Our plan is to provide better market opportunities to local farmers as they will have a supply contract with the feed mill plant," he adds, noting that he has met with key company officials to discuss the terms in early December last year.
The DA will serve as consolidator for local corn farmers, giving them assurance of "better market prices for their produce".
"This process will slowly eliminate the so-called middlemen, and will, at least, provide the farmers better profits for their produce," Oñate, Jr. explains. At the same time, farmers will not be compelled to sell their entire harvest to the company if they can find higher prices from other buyers.
Initially, farmers will be under contract to sell half of their produce at a premium price to Vitarich which in turn will be providing farm inputs. Oñate said that Vitarich, a listed company that exited corporate rehabilitation in September last year, will require "good quality" yellow corn for its feed mill.
The Philippine Statistics Authority reported that in the first semester of 2015, Davao produced 19,329 tonnes of yellow corn, higher than the 17,642 tonnes in the same period the previous year.
The new Vitarich feed mill, according to the company brief, is located in a four-hectare area in the northeastern part of the city. It is expected to be fully operational within the third quarter of 2017 and has a capacity of 10 tonnes per hour. Vitarich's operations involve feeds for livestock, poultry and aquaculture as well as broiler production.
Oñate says that the DA-Davao Region is on the lookout for similar agreements with other agribusiness companies.
- Business World Online
