Creating a Sustainable Farming Community Through a Social Enterprise

By Kathleen P. Lungub

As he stood in the scorching heat, 57-year-old Mang Kikoy wondered if he still had crops to harvest that season. For the past four months, rain had been scarce and the prolonged heat eventually shrank and withered his plants.

He relates that the natural calamity was a big blow. Because of the drought, he lost his source of livelihood and three of his children were forced to work in nearby provinces to help feed the family and send their youngest sibling to school.

His experience is typical of the lives of 180,000 farmers in Isabela after a dry spell hit the province in 2013. In four months of reduced rainfall, more than 3,000 hectares (ha) of land dried up, decimating over PhP33 million worth of crops.

Rice and corn farmers like Mang Kikoy shifted to organic farming after learning that chemicals harm the environment. Farmers favor organic farming because it protects the environment, produces typhoon and drought-resistant crops, and is cheaper because it makes use materials already available on the farm.

While it is considered the “rice and corn granary of the Philippines,” Isabela faces strong typhoons, frequent drought patterns, and other problems aggravated by climate change. After a major disaster, food supplies are cut short, children have to stop going to school, and as they have little or no savings at all, farmers are often forced to borrow capital from loan sharks who charge extremely high interest rates and force farmers to sell their produce to them at bargain rates after harvest.

Organic agriculture as a primary advocacy

Realizing the vulnerabilities of farmers, several Belgian missionaries headed by Dirk Detemmerman visited the municipality of Gamu in Isabela in 1985 to assist the farmers through the non-government organization Parish Youth of Gamu (Payoga NGO). Originally formed to give free education to the children of farmers who cannot go to school, the organization began to promote organic farming upon realizing that the poor conditions of farmers stemmed from the acquisition of costly synthetic chemicals and fertilizers, which often plunged them into recurring debts after the inevitable natural calamities occurred.

Organic agriculture is a farming technique that uses natural inputs such as animal manure and crop wastes to produce quality crops without compromising the environment and the people who live and work with it. In contrast to chemical farming, when properly practiced, organic agriculture can help enrich the soil and can be cheaper as it uses resources existing on farms.

For instance, a farmer who wants to plant 1.8 ha of land will only need a total of P6,000 for 20 bags of organic fertilizer compared to at least R20,450 for chemical fertilizers in one planting season. Users of chemical fertilizers can also expect to spend more in succeeding years since with regular use, certain crops will develop a dependency on certain kinds of chemical fertilizers. As a result, a greater amount of chemical fertilizers is needed to sustain the same yield of crops every year. The prolonged use of chemical fertilizers also depletes the soil of the microorganisms plants need to survive and grow well. Thanks to the seminars and training sessions held by the Payoga NGO, Mang Kikoy realized that he had a responsibility to take good care of his environment as he made his living from it. Thus, in 2008, he shifted to organic farming.

He quickly learned that fellow farmers thought it was impossible to get good harvests without
chemical fertilizers. But he came to see why this was a false belief, and he explains that he realized that chemical fertilizers were harmful to the soil and human health.

Despite the initial hesitation of some farmers, the Payoga NGO continues to work to educate them about protecting the environment through organic farming. To date, 2,650 rice and corn farmers in Isabela have joined the cooperative and shifted from conventional to organic farming.

The Shift to a Multi-Purpose Cooperative

After they saw positive results, members of the Payoga NGO decided sustain their operations by becoming a cooperative. But as the cooperative grew in assets, they developed management problems that made it rethink its commitment to the mission of educating and lifting farmers’ lives through organic farming.

Julie Madrid, general manager of the Payoga/ Kapatagan MPC, is one of the pioneers in promoting organic agriculture in Gamu, Isabela. Joining her are dedicated members of the cooperative/social enterprise who are ready to spread the advocacy throughout other communities in Isabela.

Led by Julie Flores-Madrid, general manager of the Payoga/Kapatagan Multipurporse Cooperative (Payoga/Kapatagan MPC), the cooperative continued to advocate for organic farming while adding capacity-building, livelihood and sustainable agriculture training, zero management training, values formation, and community services (like giving seeds to households and schoolchildren) to its activities.

It also ventured into nursery operations, trading and marketing, selling of livestock, and the production of organic fertilizer. Its organic fertilizer, “Greenfriend,” is made up of biodegradable raw materials such as chicken, bat, and carabao manure, and rice straw. Greenfriend mixes these materials with carbonized rice hull, agricultural lime, legumes, and enzymes in 80% water.

Members and non-members can earn money from selling fertilizer inputs to the cooperative. Farmers who collect rice straw get R500 for every 250 kilograms (kg) sold to the cooperative, and R30-45 for every 50 kg of chicken, bat, and carabao manure. Members who compile the mixture during harvesting and packaging also earn R16 per 50kg.

From 45,000 in 2006, the production of “Greenfriend” bags increased to 280,000 in 2015. The number of regular employees also reached 70, and each member benefits from the low buying prices for organic fertilizer bags at P210 each; the same are sold to dealers for P230/bag and government offices at P245/bag.

Aside from these services, the cooperative also markets farmers’ products to private companies and the government at markedup prices. In contrast to the traditional system in which farmers sell their produce at very low prices, the cooperative ensures that the farmers are paid a reasonable amount for their quality organic crops. On top of the marked-up price, members who are contracted to produce seedlings are given a patronage refund and shared dividends of about 70% of the total earnings of the cooperative at the end of the year.

Establishing Alliances 

As the cooperative’s membership grew, it became more determined to encourage farmers to practice organic farming. It was at this point that the Payoga/Kapatagan MPC heard about the Foundation for a Sustainable Society (FSSI).

“When I first heard about FSSI, I thought that it will be good to partner [with them] because we both promote the welfare of the people and the environment, and [FSSI] also has the desire to help the farmers [and] community members [in doing] business,” says Madrid.

At the onset of the partnership, FSSI gave the members financial and technical assistance and introduced them to the concept of social entrepreneurship; it delighted the members as they realized that this was what they have been doing for so long. As a social enterprise, Payoga/Kapatagan MPC is equally mindful of its economic, social, and environmental goals.

Then the Payoga/Kapatagan MPC was asked by the local government unit to represent all farmer organizations in the Council on Organic Farming, National Disaster, and Small and Medium Enterprises, in addition to helping with the implementation of the municipality’s environment policy.

Regional branches of government agencies such as the Department of Education, Department of Agriculture, and Department of Environment and Natural Resources also formed partnerships with the cooperative by becoming the market for seeds and organic fertilizer.

The partnership with FSSI has also been essential in the cooperative’s participation in the Isabela Social Enterprise – Local Economy Development Network, a vibrant group of 14 organizations united to steer local economy development in the province of Isabela through social enterprises.

Looking back, Madrid can say that majority of what the cooperative envisioned has been realized. Among its achievements is the increased awareness of local farmers of the need to protect the environment. She explains that back in 2001, in discussions regarding climate change, people still questioned the need to plant trees and why organic farming and fertilizer were needed.

But today, the way people see the environment in the context of farming has changed as they’ve realized that not only does chemical-based chemical farming cause them to incur debts, it is also disadvantageous to the environment which is supposed to be preserved for the next generation, adds Madrid.

By becoming a social enterprise, Payoga/Kapatagan MPC sees more opportunities to sustain itself while spreading its mission of promoting organic agriculture and transforming the lives of farmers throughout the farming communities of Isabela.

The Foundation for a Sustainable Society (FSSI) is a social investment organization committed to support the development of sustainable communities through social entrepreneurship. Since 1995, it has developed social enterprises with triple bottom lines in marginalized communities that are owned, managed, and operated by the poor, and are economically sound and environmentally-friendly. Theirs is a network of dynamic organizations in the field of social and economic work.

This appeared as in Agriculture Monthly’s June 2016 issue.

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