Net Margins Analysis of Selected Fruits and Vegetables in Southern Mindanao, Philippines

• Main Authors: Laorden, N. L, Digal, L. N, Aguinaldo, R. T, Romo, G. D. A, Sarmiento, J. M. P, Balgos, C. Q
• Format: Conference Proceeding
• Language: English
• Published: 13.10.2011
• Edition: 2232
• Subjects: Crop Production/Industries; Distribution of benefits; High value chain; Industrial Organization; Net margin share; Net margins; Public and private strategies; Support systems
• DOI: 10.22004/ag.econ.290419

Agriculture is the driving force behind Mindanao’s economy. It plays a major role in the economics of development since a continuous level of farm production can be one of the wellsprings of commercial and technological growth. However, developments in the agrisector can be hampered by productivity constraints as producers aim to play a role in high value chains and other emerging markets. Net margins analysis is used in this research to assess the performance of value chains and their implications in terms of public and private strategies. The analyses reveal the following: (1) Inadequate knowledge on farm techniques leads to higher cost and lower productivity; (2) Poor road conditions and the lack of farm to market roads lead to high wastage rates and lower profitability; (3) Low volume of transaction and poor market regulations lead to higher cost and lower profit; and (4) Farmers’ individualistic behavior worsens the aforementioned problems since producers and wholesalers operating at a smaller scale show lower benefits received in terms of net margin shares. To enhance performance and productivity of small farmers in the chain, it is important to address the issues on soil and disease management, access to credit, support systems in terms of production and marketing, infrastructure and post harvest technology.