CONCEPT NOTE

FAMILY CACAO DEVELOPMENT PROGRAM

A Strategy to Alleviate Poverty and Achieve Inclusive & Sustainable Rural Development
INTRODUCTION
Poverty in the Philippines remains a predominantly rural phenomenon, which is partly
attributable to decade-long problems in agriculture. In 2014, almost 75% of the poor were found in the
rural areas, where the poverty incidence was 37.84%. Farmers and fishermen mostly comprise poor
families because their livelihood is unstable and aggravated by the adverse effects of climate change.
Family Cacao engages households into production of 500 cacao trees per hectare under a
contract-growing framework. The Grower shall provide for labor and farming area (inter-cropping
with coconut trees highly suggested) while the Consolidator provides for the planting materials like
cacao seedlings, fertilizers, insecticides and other support services. The latter buys harvested cocoa
fruits/beans at negotiated price allowing the former a guaranteed annual income of more or less
P60,000/hectare. The consolidator shall also put up a nursery for cacao seedlings, cacao-beans drying
and processing facility where women members of the household can work after undergoing relevant
training.
In implementing the program, the consolidator shall collaborate with other stakeholders such as
the Department of Agriculture, Department of Science and Technology, Department of Social Welfare
and Development, the Land Bank of the Philippines, and such other government and Civil Society
Organizations (CSOs) that may play an important role in making the project a success.
GOALS AND OBJECTIVES
Goals

To provide poor families a stable source of income for food on the table, sending children to school
and for other basic needs.
To be instrumental in the entry of Family Cacao into the mainstream cacao industry.

Objectives
1. Engage 50 poor families into small-scale cacao production for an aggregate 150 hectares.
2. Employ 500 people at the nursery and at the cacao-beans drying processing facility.
3. Share 20% of the local and export market in cacao-beans and cocoa products
EXPECTED OUTCOME

The expected outcome from the program would be the improved living conditions of poor
families. The increased spending of these poor families which is estimated to amount to P180 million
annually will flow back to the rural economies thus increasing the demand for more goods and services
and create a favorable environment for new businesses and job opportunities.

INNOVATION
Instead of the native species common to rural backyard farmers, hybrid species that matures and
bears fruit faster (2-3 years) and yields more seeds shall be used.
BUDGET
Total budget for the program is estimated to amount P50 million, broken down as follows:
Program Component

Costs

Contract Growing

5,000,000

Nursery for Cacao Seedlings

5,000,000

Drying and Processing Plant

30,000,000

Working Capital

10,000000

Total

50,000,000

Funding Options

Amount

Donor/Loan Financing

40,000,000

Consolidator's Equity

10,000,000

Total

50,000,000

Financial Viability

Amount

Revenues
Sale of dried cacao-beans

45,000,000

Sale of cocoa products

16,000,000

Total

61,000,000

Cost and Expenses

36,000,000

NET INCOME

25,000000

Return on Investment (ROI)

Payback Period
Note: A full blown Project Study shall be submitted upon request.

50%
2 Years