Prospect and Perspective of Prospect and Perspective of the Seaweed Industry for the Seaweed Industry for

Building Capacities of Local Building Capacities of Local Communities to Cope with Communities to Cope with

GlobalizationGlobalization

Seaweed Industry Association

of the Philippines

Legend: % Production

----- Highly-developed – 88%

----- Semi-developed – 10%----- Under-developed – 2%

Commercial Species of Commercial Species of Seaweed in the PhilippinesSeaweed in the Philippines

Carrageenan Bearing Red Seaweed– Eucheuma Cottonii– Eucheuma Spinosum

Agar-Agar Bearing Red Seaweed– Gracilaria– Gelidium

Types of Carrageenan Types of Carrageenan ExtractedExtracted

Eucheuma Cottonii – Kappa– Applications

Dairy Products Meat and Poultry Water gels Processed Human foods & Pet Foods Pharmaceutical Personal Care

Eucheuma Spinosum – Iota– Applications

Toothpaste Other Dairy Products Pharmaceutical

Products Produced by the Products Produced by the Philippines(Eucheuma)Philippines(Eucheuma)

Refined CarrageenanSemi-Refined Carrageenan Food

GradeSemi-Refined Carrageenan Pet

FoodAlkali Treated ChipsRaw Dried Seaweed

Philippine Position to World Philippine Position to World MarketMarket

Refined Carrageenan – No. 4Semi-Refined (Foodgrade) – No. 1Semi-Refined (Pet Food) – No. 2Alkali Treated Chips – No. 1Raw Dried Seaweed – No. 1

Countries Producing Countries Producing Eucheuma SeaweedEucheuma Seaweed

Philippines – 72%– Cottonii – 97.7%– Spinosum – 2.3%

Indonesia – 22%– Cottonii – 92.3%– Spinosum – 7.7%

Malaysia – 2.7%– Cottonii – 100%

Zanzibar – 3.3%– Cottonii – 23%– Spinosum – 77%

Philippine Exports as of 2003Philippine Exports as of 2003

Raw Dried Seaweed– Volume, 27,540.0 M/tons– Value, US$15,067,330.00

Refined Carrageenan– Volume, 4,874.0 M/tons– Value, US$41,421,745.00

Semi-Refined Carrageenan– Volume, 22,201.0 M/tons– Value, US$87,103,214.00

World Demand on Eucheuma World Demand on Eucheuma SeaweedSeaweed

Specie of Seaweed 2001 2002 2003EucheumaCottonii 169,000m.

t.180,000m.

t.220,000m

.t.

Eucheuma Spinosum 15,000m.t. 18,000m.t. 22,000m.t

.

Projected increase in demand:E. Cottonii – 10% AnnuallyE. Spinosum – 7% Annually

World Supply SituationWorld Supply Situation

Countries 2001 2002 2003

Philippines a. Cottonii b. Spinosum

118,460.0 m.t.4,120.0 m.t.

125,254.2 m.t.5,500.0 m.t.

127,693.2 m.t.3,000.0 m.t.

Indonesia a. Cottonii b. Spinosum

28,797.80 m.t.3,460.00 m.t.

35,605.35 m.t.3,800.00 m.t.

36,834.10 m.t.3,100.00 m.t.

Zanzibar a. Cottonii b. Spinosum

741.95 m.t.2,483.90 m.t.

921.30 m.t.2,561.00 m.t.

1,378.00 m.t.4,613.00 m.t.

Malaysia a. Cottonii 3,225.85 m.t. 3,582.30 m.t. 4,900.00 m.t.

Total a. Cottonii b. Spinosum

151,225.60 m.t.

10,063.90 m.t.

165,560.15 m.t.

11,861.00 m.t.

170,805.30 m.t.

10,713.00 m.t.

World Market FOB PriceWorld Market FOB Price

Specie ofSeaweed 2001 2002 2003

CottoniiUS$650.00/

Metric tonUS$700.00/

Metric tonUS780.00/Metric ton

SpinosumUS$250.00/

Metric tonUS$250.00/

Metric tonUS$230.00/

Metric ton

World Market FOB PriceWorld Market FOB Price

PRODUCTPRICES

PER KILO

Refined Carrageenan US$11.00

SRC-Food Grade US$6.00

SRC-Pet Food US$3.25

ATC US$2.80

World Market TrendWorld Market Trend

There is high demand on Eucheuma Cottonii than Spinosum.

Carrageenan Market for Kappa is big, making eucheuma cottonii seaweed high.

There is more available supply of spinosum against demand.

Demand for eucheuma seaweed continuous when prices is competitive & quality is good.

The Prospect of the Seaweed Industry

In the Philippines

Supply and demand situation Supply and demand situation in the Philippines for Cottonii.in the Philippines for Cottonii.

Year Supply Demand

Shortage

2003 127,693.22Metric Tons

155,000.0Metric Tons

27,306.78Metric tons

The annual increase in demand is 10%

Philippine advantage over Philippine advantage over other countries.other countries.

Cottonii quality is higher both in recovery and viscosity.

Philippine has wider coastal areas and sea water is more suitable to eucheuma cottonii culture.

Filipinos are used to sea type of livelihood. Advance technology on farming and extraction of

carrageenan. There are 3 Refineries and 12 Semi-Refined

Processing plants for Carrageenan. Philippine and private sector forged a partnership

agreement to develop the seaweed industry. SIAP is a member of Marinalg International that helps

solved Non-Tariff Barriers for Carrageenan.

What action to take?What action to take?

Focus in seaweed production development to fill the shortage of supply on raw eucheuma cottonii.

Research and Development program for good quality seaweed production and more product applications for carrageenan.

Strengthen organization of industry players, seaweed farmers, traders and processors to maintain good quality seaweed for carrageenan production.

Government full support to the industry needs.

Non-Traditional Areas Intensive Seaweed

Production Program Chart

Fishermen’s Group

Commercial FarmingStarts 60 days after

Block module was set

PSDC(Provincial Seaweed

Development Council)

Municipal Government

Orient LGU on SeaweedFarming Development

LGU organizePSTFA

Municipal Chapter

Zone Municipal Waters& Enact Seaweed Culture

Ordinance

Issue Permitto Culture Seaweedto Seaweed Farmers

Conduct Technology Seminar& put up one Block Module

(10m. X 25m.) to PSFTA

SIAP PROPOSAL ON BFAR SIAP PROPOSAL ON BFAR NURSERY FARMSNURSERY FARMS

Use the nursery farms as techno demo module in new municipalities targeted for development.

Award 250 square meters module to an interested family beneficiary & operate to own.

Make this as show case to others and a good venue for lakbay aral training once successful.

This can also serve as initial source of seedlings for further development of the area.

BFAR training funds can be used in training beneficiaries.

TARGETED AREAS TARGETED AREAS FOR DEVELOPMENTFOR DEVELOPMENT

14 New ProvincesSultan Kudarat, South Cotabato, Sarangani, Agusan del Norte, Misamis Oriental, Siquijor, Biliran, Capiz, Aklan, Romblon, Oriental Mindoro, Catanduanes, Albay & Aurora

36 Provinces for ExpansionSulu, Basilan, Maguindanao, Davao del Sur, Davao City, Davao Oriental, Agusan del Sur, Surigao del Sur, Surigao del Norte, Camiguin, Lanao del Norte, Misamis Occidental, Zamboanga del Norte, Bohol, Cebu, Negros Oriental, Southern Leyte, Leyte, Eastern Samar, Western Samar, Northern Samar, Iloilo, Guimaras, Antique, Negros Occidental, Masbate, Sorsogon, Camarines Sur, Camarines Norte, Quezon, Marinduque, Occidental Mindoro, Palawan, Batangas, Zamboanga del Sur & Pangasinan

FINANCING COMPONENT

Leader/Trader

LBPQUEDANCOR

Initiate Loan Application(Loan issued not in cash but materials)

Issue Permit onSeaweed Culture

Issue Permit tooperate business

FARMERS

LGUIssue AccreditationPapers & Market

Linkage to Processors

SIAPPrepare farmers’ information sheet

for loan application

ROLE OF LANDBANK & QUEDANCOR

LANDBANK

COOP

FARMERS

Process &Release Loan

Prepares Application& Release Loan

(Materials not cash)

QUEDANCOR

LEADER/MUNICIPAL TRADER

FARMERS

Process &Release Loan

Prepares Application& Release Loan

(Materials not cash)

RediscountLoans

FINANCING LOAN TO TRADERS

TRADERS

LAND BANKQUEDANCOR

Inspect Inventory of seaweedPROCESSORSRaw Exporters

Delivers Seaweed under Marketing AgreementAnd Purchase Order

Payment of deliveries Directly paid

Excess from LoanIs returned

SIAP ORGANIZATION AND ACREDITATION PROGRAM

Accredited

SIAP

Carrageenan Processors

Raw SeaweedExporter

ProvincialTraders

MunicipalTraders

Farmers

Certifying OfficeSIAP

Certifying OfficePSFTA

Certifying OfficeMunicipal Chapter

PSTFA

Accredited

Accredited

SIAP SOCIAL PROGRAM

Force Savings

Land Bank

MunicipalTraders

Farmers

Authorize to collect deposits

Deduct 10% of farmers’ salesfor deposit

Individual Farmer’s Savings Account

PHILHEALTH

Register Farmers& Remit Monthly Premium

Collect Monthly Premiums

S.S.S.

As a result….As a result….

Philippines will be the major leader supplier of raw dried cottonii seaweed and Kappa Carrageenan worldwide.

There is a ready and continuous market for all seaweed produced by marginal fishermen or seaweed farmers whereby providing them a lucrative and sustainable livelihood.

Seaweed will be the major dollar earner for the country.

More coastal areas are protected from Illegal Fishing.

PERFORMANCE TARGET

Year Production in

Metric Tons

Number ofFamilies

Total Area In

Hectares

Value of ExportsIn US$

2004 168,014.00 152,740.0 76,370.00 185,699,297.00

2005 227,937.00 207,216.0 103,608.00 251,930,466.00

2006 281,184.OO 309,303.0 154,651.00 310,782,444.00

GOALSGOALS

In 2004, to fill the requirement of Philippine Carrageenan Processors and in 2006 to fill the world demand of Dried Eucheuma Cottonii Seaweed.

Increase livelihood opportunities among marginal fishermen and exports.

Minimize Illegal Fishing Activities.

What field of Activity in What field of Activity in Eucheuma/Carrageenan Eucheuma/Carrageenan

industry affect the Philippines?industry affect the Philippines?

In terms of Community Development and environment.

PROCESSINGPROCESSING

It generates employment.It opens the market for raw dried seaweed

produced by farmers.It can contribute to the Philippine economy

by increasing exports.It adds a higher value to seaweed.

TRADINGTRADING

It generates employment in the country side.

It links farmers to the processors and even world market for seaweed.

It directly help farmers in term of their domestic needs (either foods or cash advances for healthcare or farming.)

FARMINGFARMING Over a million marginal fishermen are engage in

seaweed farming with an average annual income of P120,000.00.

Opening of new markets increase the shortage of raw supply by as much as 45,000 metric tons annually in 2004 and is an opportunity for 23,000 families of new and unemployed marginal fishermen to engaged in seaweed farming livelihood.

Contract farming scheme developed fishermen into an entrepreneur.

More coastal areas are protected from illegal fishing. It improves the economic condition of the

community.

Intensive Eucheuma Intensive Eucheuma Seaweed/CarrageenanSeaweed/CarrageenanIndustry Development,Industry Development,

Developed marginal fishermen capacities in facing the challenge of

globalization in the field of additives.

ON THE AGAR-AGARPRODUCING SEAWEED

Present SituationPresent Situation

Gelidium Seaweed– High Commercial value and dried seaweed is exported

to Japan, Korea and even Taiwan.– Agar-Agar produced locally is in demand in the local

market.– Gathered wild, there is no commercial farming

technology that invite fishermen to engage into the activity.

Gracilaria Seaweed– Commercial farming technology has been adopted.– Lower commercial value that farmers are discouraged to

culture.– Agar-Agar content has lower viscosity compared to

other countries.

Is there a future for the agar Is there a future for the agar industry?industry?

Gelidium– More research for farming technology that is lucrative to

fishermen in terms of income.– The market for dried gelidium seaweed is big.– Intensive product applications both in the local and foreign

market. Gracilaria

– Culture of gracilaria can be done in Bangus or shrimp ponds.

– Identify the best specie of gracilaria with higher viscosity.– More research on how to blend agar increasing its viscosity.– The trend for agar uses is now focused on soft gel than the

traditional hard gel produced by South America and other European or Asian Countries.

“IF” GOVERNMENT AND PRIVATE GOVERNMENT AND PRIVATE

SECTOR COOPERATESSECTOR COOPERATESHONESTLYHONESTLY

(WITHOUT CORRUPTION)

PROSPECTS OF THE SEAWEED

INDUSTRY TO COPE WITH GLOBALIZATION IS ATTAINABLE

Thank you !!!!!!