INVERSION  

 

 
INVESTMENT OPPORTUNITY

DEPARTMENT OF TRADE AND INDUSTRY
ZAMBOANCA CITY OFFICE

 INDUSTRY PRIORITY AREAS
For ZAMBOANGA CITY CY 2002
 

INDUSTRY PRIORITY AREAS

FOCUSED SECTOR

ORNAMENTAL HORTICULTURE

 

FRESH/PROCESSED PRODUCTS

MANGO

FRUIT JUICES

MARINE PRODUCTS

PROCESSED FISH

SEAWEED

HOUSEWARE

GARMENTS/TEXTILE

CANDLES

HANDWOVEN ITEMS

WEARABLES

FASHION ACCESSORIES

JEWELRY

HOME FURNISHINGS

FURNITURE

PRIORITY SECTORS

    1.   PROCESSED FISH (Plus 1 Project)
    2.
   SEAWEED
    3    MANGO
 

 

PROFILE OF THE SEAWEEDS INDUSTRY
ZAMBOANGA CITY

Introduction
 

Seaweeds is a mass growth of marine algae from natural stock or from pond culture. Generally, there are four main groups of marine seaweeds, the red algae (Rhodophycae), brown algae (Phacophycae, green algae (Chlorophycae and the blue green algae (Cyanphycae). The red and brown seaweeds, which is grown in large commercial quantities are utilized to manufacture three seaweeds colloids which are of major industrial use: agar, alginates and carrageenan. Agar and carrageenan are extracted from red seaweeds while alginates are extracted from brown seaweeds. The most important variety of seaweeds is Eucheuma. which is commonly grown in the Philippines. Eucheuma is the source of carrageenan, one of the world's foremost food and industrial additives. It is a valuable substance used in gelling, suspending, thickening or water-holding properties in various products. In terms of purity, carrageenan is classified as Refine Carrageenan (RC) or semi-refined Carrageenan (SRC SRC possesses all the qualities of a refined carrageenan except the ability to from perfectly clear solutions. Several product types classified as SRC are: Philippine Natural Grade (PNG), Alternately Refined Carrageenan (ARC), alkali-Treated Carrageenan (ATC) and processes Eucheuma Seaweeds (PES).
 

Dried Seaweeds

The Philippines is the world's largest producer of Eucheuma comprising about 80% of the total world supply. Raw Eucheuma is sold according to its quality. Most Eucheuma products, however, are exported in the processes form comprising of about 65% of the total Philippine seaweeds exports. In 1993 and 1999, the country exported US$64.2 million and US$95.6 million respectively of seaweeds of all types. Eucheuma seaweeds and its processed form have been identified one of the 14 export winners of the Philippines having contributed significantly to the country's exports.

Mindanao accounts for 71% of the seaweeds production of the entire Philippines. It was estimated in 1996, that some 100,000 families are engaged in seaweeds farming and about 72% of these families are located in Mindanao particularly in the ARMM provinces and the Zamboanga Peninsula.

Zamboanga City has more that 2,000 hectares devoted to the seaweeds farming providing livelihood to more that 3,000 families. At present, there are three processing plants in Zamboanga City producing semi-refine carrageenan and alkali treated chips. Another processing plant will operate in year 2001 also to produce semi-refined carrageenan. Presently processed and dried seaweeds are exported to numerous international markets, shipped to Cebu or Manila in the dried form for further processing into carrageenan.

THE SEAWEEDS INDUSTRY SITUATION

Production
 In the early days of the seaweeds industry, the Philippines became the leading producer of Eucheuma seaweeds accounting for 80% of the total world supply. The Eucheuma species serves as a raw material in the manufacture of carrageenan.

The country has an estimated 8,300 hectares of marine areas that have potential for Eucheuma seaweeds farming. About 96% of these areas are located in Mindanao. Zamboanga Peninsula and Sulu have been found to have the widest seaweeds farming area with farming expansion of more that 7,000 hectares of potential sites. Sulu, Tawi-Tawi  and Western Mindanao have a decided advantage over other potential areas.

Seaweeds are mainly cultures and gathered in the ARMM Provinces (Sulu and Tawi-Tawi) and western Mindanao (mainly Zamboanga City) and southern Tagalog (mainly Palawan) accounting got 57%, 14% and 23% of production output respectively. For the period 1993-1997, the volume of seaweeds produced registered an average annual growth rate of 16%. Over the same period, ARMM and Western Mindanao accounted for an average 71% of the total national production output.
 

Volume of Cultured Seaweeds by Region 1993-1998
Volume in Metric Tons (In Wet Weight Basis)
Region 1993 1994 1995 1996 1997 1998
Philippines 401,548 481,495 558,270 631,386 627,105  
Ilocos            
Cagayan Valley            
Central Luzon            
Southern Tagalog 24,514 80,638 93,925 164,958 143.867 143,042
Bicol 1,144 1,683 10,813 8,845 3,234 7,265
Western Visayas 2,152 1,683 1,279 13,111 2,087 12,717
Central Visayas 75,653 51,139 20,146 26,372 31,060 8,841
Eastern Visayas 131 81 60 65 70 62
Western Mindanao 24,037 53,707 87,402 93.845 90.584 109,891
Northern Mindanao 276 155 42 43 40 15
Southern Mindanao 471 461 441 432 459 356
Central Mindanao 147 134 22 16 17 21
ARMM 272,395 390,330 345,749 335,060 355,054 359,516
CARAGA 628 493 391 440 515 594
Source: The Seaweed Industry: Status and Investment Opportunity. 1998 are preliminary figures
 

In value of terms, the seaweeds industry hit the billion mark in the early 1990's and continues at the same pace today registering average growth of 4.73% for the period 1993-1997. From PhP1.1989 Billion in 1993, the industry grew to PhP1.623 billion in 1996 slightly tapering to Php 1.395 billion in 1997. The rather disappointing performance in 1997 was the effect of El Niņo phenomenon that hit the production areas resulting in the drop in production. This production loss and the loss in value of the peso owing to the Asean financial crisis were responsible for the 14% decrease in the value of seaweeds. The industry however, started to pick up and registered remarkable performance since then.

On the regional scale, Western Mindanao (mainly Zamboanga City) registered a high 13.84% average growth rate in the value of seaweeds produced for the period 1993-1997. While ARMM only registered a 2.43% growth in the value terms over the same period.

 

Value of Cultured Seaweeds by Region, 1993-1997 in '000 Pesos

Region 1993 1994 1995 1996 1997 1998
             
Philippines 1,198.066 1,232,790 1,327,456 1,622,665 1,395,904 1,670,220
Ilocos            
Cagayan   Valley            
Central Luzon            
Southern Tagalog 61,397 183,442 205,250 405,195 332,372 347,544
Bicol 3,168 7,635 30,557 25,795 8,853 24,864
Western Visayas 10,704 8,815 6,832 7,384 10,129 38,987
Central Visayas 404,990 256,361 100,662 134,887 140,622 42,072
Eastern Visayas 586 370 283 325 294 388
Western Mindanao 77,025 155,728 231,800 263,520 223,444 288,850
Northern Mindanao 1,324 818 240 257 208 100
Southern Mindanao 1,716 1,607 1,722 1,759 1,646 1,404
Central Mindanao 731 670 122 94 90 140
ARMM 633,375 614,914 747,995 780,112 676,268 921,989
CARAGA 6,050 2,430 1,990 2,337 2,978 2,973
Source: The Seaweed Industry: Status and Interment Opportunity. 1998 are preliminary figures
 
Market Performance
 
The Philippines is considered as the world's leading supplier of Eucheuma comprising about 80% of the world's supply. Raw Eucheuma is sold according to its quality. Most Eucheuma products, however, are exported in carrageenan or processed form. Two types of Eucheuma seaweeds are exported in dried form. These are the Eucheuma Cottoni and Eucheuma Spinosum.

The seaweed industry has manifested a remarkable performance in the international market. In 1999, the Philippines exported a total of US& 95.653 Million worth of seaweeds in all forms up from US$ 64.211 Million in 1998 or an increase of 49%. Zamboanga City contributes an average rate of 21% to the total Philippine seaweeds export over the last 4 years.

Zamboanga City has over ten (10) key players in the seaweeds industry comprising of processors, traders and exporters. Two of the largest processing plants are located in Zamboanga City: Marcel Trading Corporation and Polysaccharide Corporation. A company which is currently producing alkali-treated chips will soon operation a plant that will produce semi-refined carrageenan. At least 10 companies are exporters of seaweeds in the dried form.

 

Value of Seaweeds Exports
Philippines vs. Zamboanga City
1996 to 1999 In millions US Dollars

Year Philippines Zamboanga City Share
1996 93.969 8.345 8%
1997 94.699 21.298 26%
1998 64.212 16.578 26%
1999 95.653 22.956 24%
Source: Bureau of Export Trade Promotion, DTI

 

Dried Seaweeds Warehouse
 

Carrageenan Processing Plant

Zamboanga Carrageenan Manufacturing

 

Key Industry Players, Zamboanga City
 

Company Products Address
1. Marcel Trading Corporation Processed Carrageenan San Jose Gusu, ZC
2. Polysaccharide Corporation Semi-Refined Carrageenan Maasin ZC
3. LM Zamboanga United Trading Dried Seaweeds Rojo Cmpd. Sta. Catalina ZC
4. Omar General Trading Dried Seaweeds Rojo Cmpd. Sta. Catalina
5. Southern Seaweeds International Dried Seaweeds Sta. Catalina ZC
6. King Hock Seaweeds Ent. Dried Seaweeds Rojo Cmpd. Sta. Catalina ZC
7. Ramon Chua and Company Dried Seaweeds Rojo Cmpd. Sta. Catalina ZC
8. Sulbasco General Trading Dried Seaweeds Gov. Ramos Ave. Sta, Maria ZC
9. Harry Chua Trading Dried Seaweeds Rojo Cm[d. Sta. Catalina ZC
10. Zamboanga Fish Trading Dried Seaweeds Veterans Ave. ZC
11. Luzon Copra Dried Seaweeds Campaner St. ZC
12. IA Business Enterprises Dried Seaweeds Lunzuran ZC
13. Chen Hong Marine Products Dried Seaweeds Baliwasan Seaside, ZC
 
Organization and Local Partners

There are eleven (11) associations/cooperatives and one development council in Zamboanga City. The main private sector partner is the Western Mindanao Seaweed Industry Development Association. The following government agencies and private sector groups were organized into a cluster known as the Seaweed Industry Cluster Inter-Agency Task Force.

National Agencies

1. Department of Trade and Industry
2. Department of Science and Technology
3. Department of Agriculture
4. Department of Environment and Natural resources
5. Bureau of Fisheries and Aquatic Resources
6. Regional Fisheries Training Center

 
Local Government
1. Office of the City Agriculturist

Private Sector/Academe
1. Zamboanga City State College of Marine Science and Technology
2. Growth With Equity in Mindanao
 

SEAWEED INDUSTRY VALUE CHAIN FLOWCHART
 

SEAWEED INDUSTRY VALUE CHAIN

 
Gap Analysis
1. Need for measures to combat diseases pestering the seaweed farm.
2. Need for measures to prevent toxic wastes affecting seaweed farming
3. Need for improved farming techniques to realize high volume of production
4. Need to improve quality of seaweeds
5. Need for post harvest facilities like solar driers and warehousing
6. Need for lower cost of freight and handling
7. Need for wide market linkage.

Strategies
1. Conduct research on diseases pestering seaweeds farms
2. Monitor, evaluate and asses effect of manufacturing operations if industries located near seaweed farming areas especially on toxic waste discharges.
3. Aggressive information/education on effective seaweed farming
4. Aggressive information drive on good seaweed farming and drying practice.
5. Upgrading farm implements and post harvest facilities like driers.
6. Conduct forum on shipping and freight costs.
7. Access  to marklet trends
 
For more information contact:
                     MR. SEVERINO M. LANDINGIN
                     Provincial Director
                     Department of Trade and Industry
                     Zamboanga City Office
                     2F SKT Bldg., #41 Rizal St., Zamboanga Ci4y
                     Tel. Nos.          (062) 991-2704
                                             (062) 991-2705
                     Fax No.            (062) 993-0594
                     E-mail : dtizambo@jetlink.com.ph
 
 
                    
 

 
 

 

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