By JAMES TABABA
SOX Peppers, owned by brothers Josue M. Carmen Jr. and Samuel Carmen, is a thriving chili pepper farm located in Region XII, specifically in Centrala Surallah, South Cotabato, Philippines. Their journey began with their respective career transitions, leading them to explore the potential of the agriculture industry. Recognizing a tremendous opportunity in agribusiness, they focused on an enterprise centered around the cultivation and manufacturing of Carolina Reaper peppers, officially the world’s hottest pepper.
Josue Carmen, who was attending the Ateneo Law School during the pandemic, witnessed the resilience of agriculture businesses as the food industry continued to thrive while many industries were shutting down. This realization propelled him to pursue agribusiness wholeheartedly, merging his passion for farming with entrepreneurship. Samuel Carmen, a chemical engineer by profession, decided to resign from his previous job to join Josue in their pepper business, leveraging his expertise from his previous careers to develop their innovative products.
In 2021, Josue and Samuel Carmen joined the Young Farmers Challenge Fund (YFCF): Kabataang Agribiz Competitive Grant Assistance Program of the Department of Agriculture and won the regional category in Soccsksargen. As a result of their achievement and the support they received through this grant, they have successfully established the largest Carolina Reaper farm in the Philippines, spanning over two hectares.
Samuel observed that there are currently no major competitors in the market. He believes that this provides them with a significant advantage as they are less likely to encounter fierce competition that could overshadow their business. He points out that their edge lies in their specialized skills in plant cultivation and product development, which set them apart from others in the industry.
The establishment and growth of SOX Peppers has also become a collaborative effort within the family, providing additional financial support. The family’s inherited land in South Cotabato, Mindanao proved instrumental as they converted it from a rice paddy into a chili farm. One advantage of their location is that it is sheltered from typhoons, allowing for a stable agricultural environment. Furthermore, despite predictions of El Niño, South Cotabato has been receiving ample rainfall.
From onions to peppers
Initially, peppers were not the Carmen brothers’s primary crop. Their farming journey began with onions, as they saw the potential in producing onions locally in South Cotabato due to the high cost and reliance on imports from Luzon. Unfortunately, their onion venture unfortunately failed to thrive. They conducted research to explore alternative crops and found that peppers would be well-suited to their region. The brothers were introduced to Carolina Reaper peppers through a relative, and recognizing the potential, they decided to focus their efforts on this extraordinary variety.
Carolina Reaper, is known as the world’s hottest pepper. Josue pointed out that Carolina Reaper is not native to the Philippines, as its seeds were sourced from the United States but have been successfully grown in their region. He highlighted the substantial difference in heat level, stating that Carolina Reaper is 22 times hotter than the local siling labuyo, which registers at 80,000 Scoville heat units. In contrast, the Carolina Reaper measures a scorching 2.2 million Scoville heat units, underscoring the remarkable disparity between the two varieties.
The primary reason that prompted Samuel Carmen to take this entrepreneurial risk is the potentially significant cost savings achieved by moving from consuming the current siling labuyo or Taiwan chili peppers to Carolina peppers. According to Samuel, by using Carolina peppers, a savings of 40-70% can be expected. Due to the intense spiciness of Carolina peppers, which surpasses regular chilis, the amount needed in product manufacturing is significantly reduced, leading to a decrease in input usage. Consequently, transportation costs and carbon footprint are reduced by 22 times, and there is also a corresponding decrease in required warehouse capacity. In terms of production, Carolina Reaper peppers offer greater economic value compared to regular chilis. Samuel believes that this increased value will attract a larger number of industrial buyers and customers, as the cost savings in production will be reflected in the product’s price. Looking towards the future, Samuel envisions that these products will ultimately replace the entire siling labuyo market.
SOX Peppers currently offers a wide range of products made from Carolina Pepper, including chili powder, planting seeds, chili flakes, fermented puree, sotu blend hot sauce, gourmet vinegar, chili garlic, chili oil, and sinamak spicy vinegar. Josue mentioned that their chili powder once achieved recognition as the third best-selling product in its category on an online platform.
According to Josue, their products possess exceptional quality and competitiveness. He confidently asserts that they provide the highest quality offerings currently available in the market, all at the most affordable prices.
Contract growing and supporting local farmers
Recognizing the importance of empowering and supporting the indigenous people and the community, the Carmen brothers actively sought ways to provide livelihood opportunities. By engaging the T’boli, the area’s local indigenous people, and leveraging their farming knowledge, the brothers fostered a collaborative environment that benefited all parties involved. This partnership not only enhanced the farming techniques but also provided the T’boli and the local community with stable sources of income.
“When it comes to the T’boli indigenous people, they are very diligent, which is why we choose to work with them,” Josue said. “They are not disadvantaged or at a loss because they have proper houses, receive a food allowance, and earn higher wages compared to the usual rates in the locality.”
The Carmen brothers plan to collaborate with local cooperatives that possess the capability to cultivate Carolina Reaper peppers. They will share their farming techniques, knowledge, and expertise with these farmers, empowering them with the skills required for successful cultivation. They also envision engaging in contract growing, empowering local farmers by providing them with the opportunity to cultivate Carolina Reaper peppers. In this arrangement, SOX Peppers would serve as the sure buyer, assuming the marketing and export responsibilities. By purchasing the peppers at a premium price, local farmers can transition from low-value crops to high-value ones, thereby securing better earnings and improving their livelihoods.
Overcoming challenges and market reach
The Carmen brothers initially aimed to pursue organic farming practices, but they encountered challenges. “If there are nearby farms that spray synthetic pesticide chemicals, pests tend to migrate to our farm,” Josue said. While they have achieved success in using organic fertilizer application, pest and disease control remain a challenge.
While their products excelled in quality and competitiveness, marketing their products has also posed challenges. Small-medium enterprises like theirs face obstacles in exporting their product due to the major requirement of Food and Drug Administration (FDA) certification for manufacturing. They are currently seeking assistance from the government or potential investors to construct a FDA-compliant processing facility.
At this time, 95% of their sales come from online platforms such as Shopee, Lazada, and TikTok Shop. “If we hadn’t been resourceful in that aspect, our business would have probably ceased to exist a long time ago. Fortunately, it has thrived in the online market,” Josue said in Tagalog.
A vision for the future
The Carmen brothers envision their business following the footsteps of industry giants like Dole and Del Monte. They aspire to establish a large-scale plant with local growers as their partners, cultivating and exporting their products on a grand scale. By aiming high, they believe that dreaming big will contribute to the agriculture industry of the country while providing opportunities for the industry.
As Samuel stated, “The end goal is to establish a facility that will generate numerous job opportunities for the community.”
Encouragement for agribusiness
“Even though we have different professions, it doesn’t hinder us from returning to agriculture because there are immense opportunities here,” Josue said. “That’s why I encourage the youth not to disregard farming because many other professions are already saturated.
Josue and Samuel Carmen emphasize the importance of dedicated hard work and passion in the face of challenges. With the growing demand for skilled professionals in the agriculture industry, they believe that pursuing agribusiness can lead to fulfilling and rewarding careers.
In the upcoming article, Samuel Carmen will provide valuable insights into his personal journey of transitioning his career to agriculture and how he equipped himself for this change.
Photo courtesy of SOX Peppers