"The minister of ministers of Madagascar came here last year and inspected our research station in Sta. Cruz and processing plant in Davao Oriental. They’re very impressed and wanted to import more. But cost becomes more expensive with volume, so they’re inviting us to set up a plant there," said Lim in an interview.
SLAC has started to ship 20 to 50 sacks (of 50 kilos each) of seeds but is now exporting 700 to 800 sacks. With Madagascar’s intent to buy about 100,000 sacks good for 100,000 hectares, cost of air freight becomes more prohibitive. Shipping these by vessel takes a longer three weeks to one month which is compelling Madagascar to invite investors to rather propagate the seeds there.
Madagascar has already tested the hybrid seeds which has been turning a good yield there as much as this could raise by 50 to 100 percent yield locally from three metric tons (MT) per hectare.
Lim said the Madagascar export market is very attractive as good quality seeds’ price ranges from $2 to $2.50 per kilo while SLAC may earn just $1.20 per kilo from the local farm if it fails to collect from farmers.
The attractiveness of the Madagascar market is particularly shaped by WB’s $200 million financing for its agricultural development.
"World Bank eyes Madagascar as the food basket of Africa. Madagascar has only 20 million population, but it has a land area double that of the Philiippines and may later plan to export rice to South Africa. With the hunger in Kenya and Ethiopia, it has a huge market," he said.
While SLAC wants to focus on the Philippines which is planning an expansion on hybrid rice area to 500,000 hectares next year, SLAC is also considering to put up a plant in Madagascar.
"We’re entertaining it, but we have not decided yet because we also have to put people there. By the end of the year, we’ll see. If the (Philippine) government does not support us, we might move our entire plant there. Madagascar has the support of the World Bank and has tested our seed for several seasons," he said.
SLAC is sending a business mission to Madagscar in September.
"They’re giving us importance there. We should be proud that the Filipino variety is now halfway around the globe. And Madagascar has no civil war, no peace and order problems, the president is very supportive. Some tell me people there leave their houses with doors open," he said.
SLAC, Philippines’ biggest hybrid rice seed producer taking up some 100,000 of 230,000 hectares in 2004 or about 50 percent, has come across this export opportunity as it has always been invited to worldwide forum on hybrid rice and increased rice productivity.
Madagascar, once a French colony but regained independence in the 1960s, is world’s fourth largest island (587,040 square kilometers) and is strategically located along the Mozambique Channel.
After abandoning socialist policies in the 1990s, WB and International Monetary Fund led its privatization and liberalization. It had real gross domestic product (GDP) growth rate of 5.5 percent in 2004 of which agriculture accounts for onefourth. It plants coffee, vanilla, sugarcane, cloves, cocoa, cassava, beans, banana, and peanuts.
It has experienced apparel boom owing to a duty-free access to the US.
Other booms...
MADAGASCAR, the movie
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