SUPPLY CHAIN ANALYSIS OF DRAGON FRUIT IN ILOCOS NORTE, PHILIPPINES

Abstract

The studyanalyzed the supply chain of dragon fruit in Ilocos Norte, Philippines. Specifically, it aimed to map the dragon fruit production, identify and assess the key players in the supply chain, project the demand requirements of dragon fruit and propose recommendations to improve and sustain the dragon fruit industry. This is a descriptive study which made use of the interview schedule in gathering data from 73 dragon fruit growers and eight processors in Ilocos Norte. Percentage, mean and trend analysis were used in the data interpretation and analysis. It was determined that 2,405,104 kg of dragon fruit were harvested in the past five years, with an average yearly increase of about 500,000 kg. A total land area of 70 ha (.02% of the total land area of the province) had been planted with dragon fruit benefitting 1,008 farmers. A modest forecast of 1,414,714 kg of dragon fruit was determined for 2016. The key players in the supply chain include: input suppliers, dragon fruit growers/ processors; assemblers/transporters (KASA Coop and SAGRAP); wholesalers/ retailers and final consumers. The Kailokuan Saniata (KASA) Cooperative and Saniata Growers Association of the Philippines (SAGRAP) provide them a strong link in the market, community and government. Directly linked, indirectly linked and fully integrated supply chains were identified. The first is seen in most of the small dragon fruit growers who directly transact with consumers. In the second, fresh dragon fruits pass through marketing intermediaries - KASA Coop, assemblers, wholesalers/retailers before reaching the consumers. These channels assemble, transport distribute and sell the products to their respective markets. The third is a unique case as all key activities related to the supply chain, from production to consumption of fruits to processing, have been integrated. In this chain, a player has control over the production and quality management of dragon fruits while supervising the production processes. This is practiced by growers who have established wide plantations and who process their harvest. The supply chain is simple (only few players). Full vertical integration is adapted wherein the dragon fruit growers are also the processors. The supply chain starts from the growing of the plant to harvesting of the fruits and ends with the consumption. The stakeholders participate in the plantation establishment, maintenance, fruit harvesting, processing, packaging, transporting, distribution and retailing of fresh and processed products, and consumption. The growers sell most of the dragon fruits as fresh. Value adding or processed products from the dragon fruit stems, flowers and fruits, (food or non-food) arenow available. As the volume of production for fresh and processed products will increase and more players will be involved in the chain, there is a need for more coordinated efforts among the players in the supply chain. The dragon fruit producers should strengthen further their cooperative and association to have a stronger bargaining power in the supply chain. Government interventions such as more training on product development should be conducted involving young and aspiring entrepreneurs. The formation of associations in the national level is perceived to hasten the development of the industry and its related chains.