South Cotabato Gov. Daisy Avance-Fuentes said Nabcor has proposed to develop the post harvest facility, which is estimated to cost at least P19.9 million, through a joint investment venture with the provincial government.
Nabcor, a government-owned and controlled corporation, is a marketing arm of the Department of Agriculture (DA).
Fuentes said she has endorsed the project to the provincial board for an evaluation of the proposed partnership agreement and the issuance of authority to the local government to make a deal with Nabcor.
In her letter to the provincial board, the governor said the proposed joint venture with Nabcor would mainly benefit at least 500 corn farmers and a total corn production area of 1,000 hectares.
"This modern post harvest facility will help improve our corn production, reduce processing costs and ensure favorable farm-gate prices for our corn products in the province," Fuentes said.
The governor explained that the joint venture, which was earlier endorsed by DA officials, was envisioned "to contribute greatly to the development of the corn industry in the province and enhance the socio-economic well-being of the farmers who are into corn farming for a long time."
She said Nabcor acknowledged that such investment will enhance the development of the province's corn sector, especially the corn farmers, local corn processors and related industries like the poultry and livestock sector and other food industries that utilize corn.
Under the proposed agreement, the provincial government will identify and recommend to Nabcor its preferred plant sites and sources of raw materials.
Nabcor, DA and the local government will jointly set the detailed plan of implementation for the proposed facilities upon the identification of the specific project sites.
Fuentes said Nabcor will invest some P14.9 million and the local government P5 million for the project.
She said the local government and Nabcor will share on a pro rata basis, depending on their proportionate share in equity investment, the net profit that would be generated by the post harvest, processing and trading operations.
"Nabcor will divest its equity share to the provincial government after it recoups its investments, including cost of money equivalent to the prevailing T-Bill rate of +4 percent at the time of divestment," Fuentes noted.
During actual operations, she said Nabcor will assume the management of the project's day-to-day operations that includes operating the processing center, warehouse and trading center. The governor said Nabcor will identify and deal with the potential markets for their products.
Nabcor, in collaboration with DA and the provincial government, will also facilitate and coordinate with various financing institutions for the provision of production inputs assistance to the target supply base to ensure the quality of the corn produce. (Allen V. Estabillo / MindaNews)