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 Asian Journal of Agriculture and Development Volume 20 Number 1 | June 2023 87

Development of Smart Food Value

Chain Intervention Models for
the Milkfish Industry in Region 1,
Philippines
Normito R. Zapata Jr., Janelle Ayne C. Sarmiento, and Mar B. Cruz Check the complete lineup
of the Asian Journal
of Agriculture and
College of Economics and Management, University of the Philippines Los Baños, Laguna, Development (AJAD)
Philippines Vol. 20 No.1 June 2023
Economic Returns to
Agricultural Research:
Thailand and Indonesia
ABSTRACT P. Warr
Agricultural Transformation
for Small (Island and
Milkfish production is an important sector of the Philippine aquaculture industry. Developing) States
The Ilocos Region (Region 1), particularly the province of Pangasinan, is the P. Teng and J.M.L. Montesclaros
country’s largest producer of milkfish. However, production and environmental Fisheries Management
Areas in the West Philippine
constraints confront the milkfish industry, such as insufficient egg supply, Sea and Their Heritage
degradation of water quality, limited processing facilities and technology, and Values
B.S. Malayang III, G.S. Jacinto,
noncompliance of small-scale processors to food safety standards. To achieve J.R. Castro, R.F. Subade, R.B.A.
sustainability and resilience, the Department of Science and Technology- Alampay, and L.J. Cruz
Philippine Council for Agriculture, Aquatic and Natural Resources Research and Enabling Adoption of Stress-
Development (DOST-PCAARRD) commissioned a value chain study to examine the Tolerant Rice Varieties and
Associated Production
current and “new normal” threats posed to Region 1’s milkfish industry. The study Management Technologies
aims to develop intervention models to create a “smart” milkfish value chain. In a by Smallholder Farmers
in Cambodia
smart value chain, the industry players access quality information better, and there G.V. Vergara, S. Srey, R.J. Flor,
are technological innovations along the chain. Various milkfish industry players, et al.
such as hatchery operators, growout operators, market intermediaries, retailers, Evaluation Criteria for
the Suitability of Apple
and processors, were interviewed for the study. Furthermore, consultations Cultivation in Kashmir
with various stakeholders, such as relevant government agencies and industry Valley, India
F.A. Lone, M.I. Ganaie, S.A.
practitioners, determined the most suitable solutions to address the value chain’s Ganaie, M.S. Bhat, and J.A.
core issues. The value chain analysis surfaced a need for an effective strategy to Rather
help farmers adopt technological solutions. In addition, the efforts of various Development of Smart Food
support institutions should be harmonized and rationalized. We are proposing Value Chain Intervention
Models for the Milkfish
these interventions: (1) create a regional milkfish seedstock command center; (2) Industry in Region 1,
implement a science and technology community-based farm; and (3) establish a Philippines
N.R. Zapata Jr., J.A.C. Sarmiento,
bangus processing enterprise development hub. and M.B. Cruz
BOOK REVIEW | Pro-Poor
Keywords: sustainability, aquaculture, hatchery, technology Development Policies:
Lessons from the Philippines
and East Asia | H.E. Bouis
JEL codes: O13, O38, Q16
BOOK REVIEW | Urban
and Regional Agriculture:
Building Resilient Food
Systems
Y. Zheng and L. Fu

Contact Normito R. Zapata Jr. nrzapata@[Link] [Link]

88 | Normito R. Zapata Jr., Janelle Ayne C. Sarmiento, and Mar B. Cruz AJAD 20.1 | June 2023

INTRODUCTION REVIEW OF LITERATURE

M
ilkfish (Chanos chanos) is the most The aquaculture industry is an important
popular fish species cultured in economic sector in many Asian countries
the Philippines (Santos, Basiao, and including China, Indonesia, Thailand, Vietnam,
Quilang 2019; Su, Lee, and Liao and the Philippines. Hence, several scholarly
2002; Tan et al. 2017; Yap et al. 2007). With an articles on the aquaculture value chain have been
average per capita consumption of 3.6 kg/year, written in recent years.
milkfish (commonly called bangus in Filipino) is the Value chain is defined by Ponte et al. (2014,
most consumed food fish in the country (Salayo et 52) as the “full range of value-adding activities
al. 2021). It is farmed in fresh, brackish, and marine that firms, farmers, and workers carry out to bring
waters throughout the archipelago, although a product from its conception to its end use and
Region 11 is the largest producer. The industry beyond.” Social relationships and norms within
began as early as the 15th century (Yap et al. the chain influence the participation of poor
2007), but production and processing technologies households (Rosales et al. 2017).This insight allows
are continuously evolving. The Department of researchers to understand the potential impact of
Agriculture (DA)-Bureau of Fisheries and Aquatic value chain upgrading on poverty alleviation.
Resources (BFAR) has been at the forefront of Milkfish production is prevalent in Indonesia,
developing the Philippine milkfish industry. On the Philippines, and Taiwan (Su, Lee, and Liao
the other hand, value chain actors composed of 2002). Various culture methods are practiced
seedstock producers, growout operators, market depending on the natural resources available. For
intermediaries, and processors provide employment example, Jaspe, Caipang, and Elle (2011) showed
opportunities and facilitate food security by how the polyculture of white shrimp (Litopenaeus
supplying affordable protein sources. vannamei) and milkfish in the Philippines could
Nevertheless, the Coronavirus disease of 2019 be a strategy for efficient utilization of natural
(COVID-19) affected various stakeholders’ efforts food production in ponds. On the other hand,
in developing the milkfish industry. The pandemic Holmer et al. (2002) revealed that fish pen culture
amplified supply chain inefficiencies, value creation in Bolinao, Pangasinan, Philippines leads to
restrictions, and inclusivity issues. The Department greater impacts on benthic carbon and nutrient
of Science and Technology (DOST) responded to cycling compared with suspended cage culture.
the challenge through a broad program developing Several studies were later conducted to investigate
smart food value chains. A smart food value chain sustainable solutions to the negative impacts of
is characterized by technology adoption and better milkfish production on marine biodiversity and
access to high-quality information along the chain. coastal health. For example, Sugimoto et al. (2016)
However, operationalization of the program is explored co-management in the governance of
not yet clear; and interventions identified in the the aquaculture industry in two municipalities of
earlier stages of proposal packaging need to be Pangasinan, Philippines.
revisited. This study commissioned by the DOST- Saraswati and Suadi (2020) investigated the
Philippine Council for Agriculture, Aquatic and milkfish supply chain model in the Beringharjo
Natural Resources Research and Development market in Yogyakarta, Indonesia. They identified
(PCAARRD) analyzed milkfish value chain and four actors in the milkfish supply chain model in
developed intervention models to build a smart the study area: suppliers, fish processors, sellers/
food value chain. traders, and ultimate consumers. The information
in the milkfish supply chain comes primarily from
the processor. In another study, Silalahi et al. (2018)
1 One of the administrative regions of the Philippines
composed of four provinces—Ilocos Norte, Ilocos Sur, utilized the interpretive structural modeling
La Union, and Pangasinan (ISM) to analyze the milkfish supply chain of an
 Asian Journal of Agriculture and Development Volume 20 Number 1 | June 2023 89

enterprise in the district of Sidoarjo, Indonesia. a. Stringent import regulations, food safety
The study recommended some managerial standards, and third-party certification of
strategies, which include relationship management key markets such as the US and EU have led
with stakeholders, capital infusion, and market aquaculture producers to seek new markets
development. (Jespersen et al. 2014).
The state of the Philippine milkfish b. The “realization that aquaculture activities
aquaculture industry presented by Marte (2010) are not high on the [government’s]
noted that milkfish farming since 1990 had an agenda…” is a common obstacle to value
average annual value of PHP2 10 billion. In another chain upgrading (Lim 2016, 196).
study, Tan et al. (2017) investigated the milkfish c. Disruptive digital platforms and technologies
attributes that consumers value in the province in aquaculture trade and logistics have been
of Iloilo, Philippines. The attributes that affected dramatically changing the performance,
price are colors of eyes and gills and fish size. The structure, and conduct of value chains (Bush
results of the study could serve as a vital source of et al. 2019).
information in upgrading the milkfish production d. The limited demand for quality from
processes. German and Catabay (2018), using data customers and weak national regulatory
gathered from local producers in the province of capacity (e.g., poor enforcement of food
Pangasinan, showed that the type of food, size of safety standards) leads to a lack of upgrading
egg/fry, frequency of feeding per day, schedule of in the value chain (Ponte et al. 2014).
water replacement per week, volume of eggs, and e. Milkfish seedstock production in the
water level affect productivity. Philippines cannot meet the domestic
Ahmed et al. (2001) comprehensively assessed demand for eggs, fry, and fingerlings (Ahmed
the milkfish fry resource in the Philippines. A et al. 2021; Salayo et al. 2021; Santos, Basiao,
survey of 194 fry gatherers in five provinces across and Quilang 2019).
the country showed their strong perception of a f. Importation of milkfish fry may become
declining supply of wild fry because of pollution, limited due to a possible milkfish fry export
degradation of coastal habitats, overexploitation ban by Indonesia (Santos, Basiao, and
of fishery resources, and decline in the number of Quilang 2019).
sexually mature milkfish. g. The technological development in milkfish
Salayo et al. (2021) conducted the most production is not always integrated
recent value chain analysis of the Philippine effectively into actual industry practice (Su,
milkfish industry. The study presented the value Lee, and Liao 2002).
chain of the clustered milkfish production system
in the Philippines. Unlike previous studies, the Past studies in the aquaculture value chain
paper focused on the primary production segment, observed and/or recommended the following
which comprised breeding, hatchery, nursery, and courses of action to address the issues that the
grow-out operations. Salayo et al. outlined several industry faces:
recommendations on how to sustain the industry a. Establish a lobby group to enhance the value
through investments in breeding and hatchery chain players’ ability to bargain support from
operations. the government (Lim 2016).
Existing literature presented a number of b. Improve product, process, volume, and/or
key challenges in the aquaculture industry in Asia variety through technological intervention
and the Philippines: (Ponte et al. 2014).
c. Create a robust legal framework and effective
legal basis of quality control to improve
2
Philippine peso; USD 1.00 = PHP 55.62 (2023) (https://
[Link]/advisor/money-transfer/currency-
products and processes (Ponte et al. 2014).
converter/php-usd/)
90 | Normito R. Zapata Jr., Janelle Ayne C. Sarmiento, and Mar B. Cruz AJAD 20.1 | June 2023

d. Implement strict regulations on size limits they recommended that research on value chain
of harvest, certification processes, seasonal should focus on sector-wide innovations, among
closures for selected species, and habitat others. This type of research will contribute to
protection among small-scale fisherfolk the design and implementation of public and
(Rosales et al. 2017). private interventions, expanding and regulating
e. Provide small-scale fisherfolk with the aquaculture sector. Furthermore, Zhang,Yang,
postharvest and credit facilities (Rosales et and Yang (2023) asserted that smart supply chain
al. 2017). management has become an important research
f. Engage in vertical integration to gain more topic under Industry 4.0. Their paper highlighted
control in the value chain (Kaminski et al. the need for more research on the different
2018). strategies for adoption of new technologies in
g. Integrate small-scale producers in the value supply chains. Hence, this study attempts to
chain through the development of cold contribute to existing literature by analyzing the
chains and logistics (Kaminski et al. 2018; milkfish value chain and formulating intervention
Saraswati and Suadi 2020). models to facilitate access to information and
h. Develop value-added products from excess technology adoption.
milkfish production to improve their
marketability to the younger generations
and the export market (Marte 2010). METHODOLOGY
i. Invest in integrated breeding and hatchery
facilities through public-private partnerships Analytical Framework
to secure seedstocks for a sustainable and
self-reliant milkfish aquaculture industry Porter (2001, 50) introduced the value chain
(Ahmed et al. 2001; Salayo et al. 2021). as a systematic way to examine how the activities
j. Ensure favorable investment climate in the of a firm are performed. The approach involves
upstream stages of the milkfish value chain disaggregating a firm into “its strategically relevant
to foster the establishment of more breeding activities in order to understand the behavior of
and hatchery facilities (Salayo et al. 2021). costs and the existing and potential sources of
k. Implement strict regulations on the catching differentiation.” The value chain of a firm is just one
of sexually mature milkfish (locally called component of the value system, which represents
sabalo), destructive fishing, fry gathering, and a larger stream of interconnected activities in the
fry smuggling (Ahmed et al. 2001). economy. The value chain of suppliers, also called
the upstream value, creates and delivers the inputs
Despite considerable studies on the to the primary producers. On the other hand, the
aquaculture, fisheries, and milkfish value channel value, also called downstream value, is the
chains, research on the development of a smart chain that ensures the delivery of the product to
food value chain for milkfish does not exist. the final user. All the activities in the chain are
According to Ryciuk (2018), a smart supply supported by other activities such as technology
chain, characterized by better access to high- development and procurement. This paper used
quality information, is essential in today’s the value chain framework of Porter to develop
uncertain and turbulent environments. A smart intervention models for milkfish in Region 1.
supply chain is one that makes full use of new Figure 1 shows the generic value chain mode.
technologies, thus making it “interconnected, Operationalizing the framework of Porter
automated, intelligent, instrumented, integrated, (2001), this study developed a general approach
innovative, and concentrated on an individual composed of two phases (Figure 2). This approach
client’s needs.” Bush et al. (2019) implied the aims to systematically analyze the root cause of the
importance of smart value chain studies when problems in the milkfish value chain and formulate
models to address the challenges.
 Asian Journal of Agriculture and Development Volume 20 Number 1 | June 2023 91

Phase 1 Step 2: Analyze the chain. Describe the

production capacity and profitability of
The first phase of this study involved enterprises along the chain.
conducting industry assessment through the Step 3: Understand value. Determine the value
following steps (Salayo et al. 2021): addition at each stage of the value chain.
Step 1: Map the chain. Determine the flow of
inputs and outputs in each segment of the The first step in the framework is value
value chain. chain mapping, accomplished by investigating the

Figure 1. Generic value chain framework

Firm Infrastructure

Human Resources Management

SUPPORT

MA
R
ACTIVITES Technology Development

GIN
Procurement

Inbound Outbound Marketing

N
Operations Service

GI
Logistics Logistics and Sales

R
MA
PRIMARY ACTIVITIES

Source: Porter (2001)

Figure 2. Analytical framework to develop value chain intervention models

Map the Analyze Understand Design

Chain the Chain Value Models

Quick Value Chain Mapping and Development of

Assessments Intervention Models
Considering
Product Upgrading
New products, matching emerging demands,
sustainable packaging, shelf-stable
Preexisting “New Normal”
Threats Threats
Process Upgrading
• Efficiency • Restrictive Smart technologies, safety protocols,
• Equity movement sustainable farming practices
• Value creation • Limited
• Sustainability accessibility
Function Upgrading
New business models, market development

Overall Chain Upgrading

Policy reforms, institutional support,
food safety
92 | Normito R. Zapata Jr., Janelle Ayne C. Sarmiento, and Mar B. Cruz AJAD 20.1 | June 2023

answers to the six questions outlined by Brown et Division (SEAFDEC-AQD), and the Provincial
al. (2010): Agriculture Office of Pangasinan. The interviews
a. Who are the customers and what are their were done online because of the COVID-19
product requirements in terms of volume, restrictions. Relevant data were collected through
quality, packaging, delivery schedules, as well database search and document reviews, such as
as grades and standards? key issues confronting the milkfish industry, the
b. Who are the key players in the chains and impact of the pandemic on industry players, and
what are their respective roles? technological interventions or programs planned
c. What are the activities and processes along or deployed to solve industry issues.
the chain? The study included in-depth phone
d. What is the flow of product, information, interviews with milkfish value chain players
and payment along the chain? preidentified by the municipal and provincial
e. What are the logistical issues? agricultural offices. Primary data on milkfish
f. What are the external influences? producers were collected using a structured
questionnaire.
Phase 2 The phase 2 of the study was conducted
from January to May 2022. Focus group
The second phase of the study involved discussions (FGDs) through online Zoom
identifying opportunities for upgrading the meetings validated the technological solutions and
segments of the value chain based on the result interventions needed to respond to the problems
of the first phase. Kaplinsky and Morris (2012) that milkfish industry players encountered. The
identified the following strategies for value chain project team, accompanied by BFAR Regional
improvement: Office 1 representatives, visited and documented
a. Process upgrading - reducing cost by hatcheries, growout farms, processing facilities,
enhancing efficiency of the process and agencies, such as BFAR Regional Office 1,
b. Product upgrading - developing new DOST Regional Office 1, and the Don Mariano
products or improving existing ones Marcos Memorial State University (DMMMSU)
c. Function upgrading - changing the mix of College of Fisheries.
activities Pangasinan and La Union were chosen as
d. Overall chain upgrading - shifting the whole sampling sites for Region 1 because both provinces
chain to new and higher value products are known as the highest producers of milkfish
in the region. Pangasinan is the top producer,
The research team coordinated with relevant harvesting and marketing a substantial volume of
DOST agencies to provide feedback from industry milkfish that generates employment and provides
stakeholders about the factors that facilitate or subsistence.
hinder technology adoption. Milkfish operators/farmers were chosen
randomly from master lists provided by the
Data Collection and Analysis Pangasinan municipal offices and the provincial
agricultural office of La Union. Many of the
The phase 1 of the study conducted from operators listed were either unavailable for
May to November 2021 utilized both primary and interview or could not be contacted due to weak
secondary [Link] data were gathered through mobile phone signal. In place of unavailable owners,
semistructured key informant interviews (KIIs) caretakers were interviewed because they were
with personnel and staff of relevant institutions directly involved in most of the farm operations.
and agencies including DOST Regional Office A total of 29 milkfish operators/farmers were
1, BFAR Regional Office 1, the Southeast Asian interviewed, with one respondent for each type of
Fisheries Development Center-Aquaculture market intermediary, except for processors since
 Asian Journal of Agriculture and Development Volume 20 Number 1 | June 2023 93

most players in this sector were not available for The president of the Raois Fish Vendors’
interview during the data collection period. Since Association in La Union said that vendors prefer to
no respondent was interviewed for wholesalers, be supplied with milkfish size 5:2 (i.e., five pieces
the insights of the key personnel from various in 2 kg) and 2:1 (i.e., two pieces in 1 kg). Milkfish
agencies and institutions were taken into account. growers in La Union usually bring their produce
For the industry assessment and value chain directly to public markets such as in San Fernando,
mapping, a comprehensive literature review Balaoan, Damortis, and Santo Tomas. According
was conducted to synthesize the key findings of to a BFAR survey, auxiliary wet market vendors
past value chain studies in the milkfish industry. in La Union sell small-, medium-, and large-sized
Interviews of officials and personnel from the milkfish for PHP 140, PHP 180, and PHP 200/
BFAR Regional Office 1, DOST Regional kg in retail. The price of milkfish increases in
Office 1, SEAFDEC-AQD, DOST-PCAARRD, accordance with its size.
DMMMSU, and the Provincial Agriculture Institutional buyers, such as supermarkets,
Office of Pangasinan provided further insights. food chains, and restaurants, require product
Stakeholders and industry practitioners in the consistency in terms of quality, size, volume, and
region were also interviewed to understand better delivery [Link] purchase milkfish products
the milkfish value chain. Meanwhile, stakeholder through consignacion, wholesalers, viajeros, or
analysis was undertaken through FGDs with processors, depending on their preferred product
representatives from government agencies and forms.
the milkfish industry, namely, hatchery operators, Table 2 suggests that most processors (19)
growout operators, and processors. Additionally, in Region 1 are registered in Pangasinan. Most
reviewed documents identified and described the of the processors in the province are small scale,
milkfish industry technologies and innovations processing milkfish into various forms: deboned,
developed by DOST-PCAARRD, BFAR, and smoked, marinated, steamed boneless, smoked
SEAFDEC-AQD. boneless, marinated boneless, longganisa (sausage),
chicharon (crackling), and lumpia (spring rolls).
Only two processors were operating at medium-
RESULTS AND DISCUSSION and large-scale, and both are based in Lingayen.

Phase 1a: Value Chain Mapping Key players and their roles

Key customers and product requirements The key players in the milkfish value chain
are the seedstock producers, milkfish operators/
The most essential product requirements for farmers, market intermediaries, processors, and the
milkfish are its size and freshness, which influence end consumers (Figure 3).
marketability and price. Yap et al. (2007) described
fresh milkfish as those that have bright eyes, bright a. Seedstock producers
red gills, undamaged abdomen, white muscle
tissues, and firm flesh. End consumers purchase The seedstock producers, in general,
both fresh and processed milkfish products. Most include the players involved in the production
of the consumers buy milkfish products from of fingerlings. The most basic participants are
vendors in public markets. Table 1 presents the the milkfish breeders who raise and maintain
farmgate, wholesale, and retail prices of fresh broodstock or sexually mature milkfish (sabalo)
milkfish produced in Region 1. As shown in the for spawning eggs. Hatchery operators rear eggs
table, a kilogram of milkfish costs PHP 120 at that produce milkfish fry, which are then raised
the farm level in Pangasinan, while retail price is by nursery operators for one to two months until
higher by PHP 50 to PHP 80. they become fingerlings. Participants at this stage
94 | Normito R. Zapata Jr., Janelle Ayne C. Sarmiento, and Mar B. Cruz AJAD 20.1 | June 2023

Table 1. Farmgate, wholesale, and retail prices of milkfish in Region 1, 2021

Farmgate Wholesale Retail
Name of Major Average Average Size (no. Average
Province Size (no. Size (no.
Public Market price per price/kg of pcs/ price/kg
of pcs/kg) of pcs/kg)
kilo (PHP) (PHP) kg) (PHP)
Magsaysay Public
120 L (1–2) 135 L (1–2) 200 L (1–2)
Market
Pangasinan Urdaneta City Public
120 L (1–2) 200 L (1–2)
Market
Bolinao Public Market 150 L (1–2) 200 L (1–2)
100 S (6 and >) 120 S (6 and >) 140 S (6 and >)
La Union Auxillary Wet Market 130 M (3–5) 150 M (3–5) 180 M (3–5)
160 L (1–2) 180 L (1–2) 200 L (1–2)
Laoag City Commercial 90 L (2) 110 L (2) 140 L (2)
Ilocos Norte
Complex 115 M (5) 130 M (5) 180 M (5)
150 2 180 2 200 2
Vigan City Public
Ilocos Sur 120 3 150 3 180 3
Market
110 4 130 4 150 4
Source: BFAR (2021)
Notes: L - large; M - medium; S - small

Table 2. Types of milkfish products processed in the Ilocos Region, 2021

Number of
Province Type of Milkfish Products Processed
Processors
Frozen whole, smoked, marinated, steamed boneless, smoked boneless, boneless,
Pangasinan 19 marinated boneless, longganisa, tinapa, chicharon, shanghai, lumpia, and fresh frozen
deboned (plain, different cuts, and relleno kit)
La Union 2 Fresh frozen deboned (plain and marinated)
Ilocos Norte 3 Deboned, shanghai, and smoked
Ilocos Sur 4 In oil, deboned, and smoked
Source: BFAR (2021)

of the value chain may perform one or more of Lingayen, San Fabian, and Dagupan City can also
the functions. It is important to note that some provide 28 million pieces fry in a year. Wild fry
players gather fry from the wild that they sell to from the Lingayen Gulf is distributed to Aringay,
nursery operators. Agoo, Bacnotan, Bangar, and San Juan. Meanwhile,
Hatcheries play a significant role in the Ilocos Coast and Bangui Bay are the sources of
milkfish industry since there is scarcity in the fry for farmers in Binmaley, Dagupan, San Vicente,
supply of fry in the country. The major hatchery Sta. Maria, Pagudpod, and Laoag City. Table 3
operators, such as Feedmix Specialist, Inc. shows the sources and destinations of wild fry in
and the BFAR-National Integrated Fisheries Region 1 for the period January–June 2021.
Technology Development Center (NIFTDC), Another alternative source of fry is
are located in Pangasinan. Hatcheries in Region Indonesia. Imported fry from Indonesia costs PHP
1 produce an estimated 147 million fry annually. 0.10 to PHP 0.13/piece, while hatchery-bred fry
Fishing grounds in Agno, Dasol, Bolinao, Infanta, in the country costs PHP 0.30 to PHP 0.35/piece.
 Asian Journal of Agriculture and Development Volume 20 Number 1 | June 2023 95

Figure 3. Milkfish value chain in Region 1

INPUT FARM MARKET

PROCESSING DISTRIBUTION
PROVISION PRODUCTION INTERMEDIATION

Consignacion, Public Markets,

Seedstock Growout Brokers, Supermarkets,
Processors
Producers Operators Wholesalers, Food Service
Viajeros Industries

- Degutting
- Deboning
- Pond/pen/ cage - Filleting
establishment - Hauling
- Broodstock - Marinating
management and - Sorting - Storage
management - Smoking
- Eggs/fry/ - Consolidation - Marketing to
- Stocking - Drying
fingerlings - Packing End Consumers
production - Feeding - Canning
- Harvesting - Transportation
- Bottling
- Packing
- Freezing

Backward and Forward Integration

The fry requirement of nursery operators in b. Growout operators

Pangasinan is 53.4 million annually; on average,
each nursery operator needs 1.1 million pieces of Fingerlings can be cultured by nursery and
fry. growout operators either in cages, pens, or ponds
Seedstock producers are mainly concerned until they have reached the marketable size and
with production losses. Inappropriate handling ready for harvest. An operator may either be
of fry causes stress and low survival rate. The the owner or a hired caretaker. Cage and pen
seedstocks should have enough oxygen supply and operators assemble and repair frames and nets
nutrition to develop optimally. The productivity as well as monitor and maintain cages and pens.
of seedstock producers is also limited by the low Pond operators excavate ponds, drain, and apply
sabalo population in the country. Private sector lime, fertilizer, and pesticide. On the other hand,
investment on sabalo raising is limited due to all operators adopting the different culture systems
its long payback period—it takes five years for perform stocking, feeding, harvesting, packing,
milkfish to be ready for spawning. Spawning of and hauling of produce. Most of them call the
sabalo is still seasonal except for Feedmix Specialist, consignacion for a hauling schedule before harvesting
Inc., which was able to develop a technology for their produce to ask about the prevailing market
year-round spawning. price of milkfish. Harvesters usually pack the
milkfish in styropor boxes or banyeras (tubs) with
ice. The milkfish-filled containers are then hauled
96 | Normito R. Zapata Jr., Janelle Ayne C. Sarmiento, and Mar B. Cruz AJAD 20.1 | June 2023

Table 3. Sources and destinations of wild fry in Region 1 (January–June 2021)

Source No. of Fry
Total No. of Fry
Collected (in Area of Distribution
Fishing ground Province Gatherers
millions)
Binmaley, Dagupan, San Vicente, Sta.
Ilocos Coast and Bangui Bay Ilocos Norte 11.98 68
Maria, Pagudpod, Laoag City
Vigan City, Sta. Catalina, Candon City,
Sta. Cruz, Sta. Lucia, Santiago, Sinait,
Ilocos Coast Ilocos Sur 8.15 377
Dagupan, San Juan, Sta. Catalina,
Narvacan
Aringay, Agoo, Bacnotan, Bangar, San
La Union 1.84 161
Lingayen Gulf Juan
Pangasinan 0.44 3 Dasol
Source: BFAR (2021)

to a vehicle, which will transport the harvested e. Viajeros

produce to fishports, trading centers, or public
markets. Viajeros transport the milkfish and distribute
them to the consignacion in fishports for price
c. Consignacion/brokers negotiation or to retailers in wet markets. The
viajero interviewed mentions that his/her key
The growout operators sell their harvested role is to assist with distribution. Likewise, viajeros
milkfish through market intermediaries such as are entrusted with overseeing/monitoring the
consignacion or brokers. When the milkfish harvest condition of the milkfish while in transit and in
arrives, the consignacion hires classifiers to sort the observing fish port transactions. Together with
milkfish by sizes. The consignacion and brokers the driver and the laborer (pahinante) who unload
sell the fresh milkfish by bidding or negotiating the milkfish produce, viajeros bring the milkfish to
the price with wholesalers in the fish port, fishports usually located in Navotas and Malabon
public market, and trading centers. After sorting, in Metro Manila.
consignacion laborers would weigh the fish according
to the buyer’s volume of order. Immediately after f. Processors
the end of the broker’s and buyer’s transaction, the
broker would pay the milkfish producer in cash. Processors could be small-scale operators
in a public market or large-scale operators who
[Link] own processing plants. These plants process fresh
milkfish into various products such as marinated,
Wholesalers purchase milkfish in bulk smoked, deboned, longganisa, shanghai, and relleno.
from farmers, through the consignacion, and resell Small-scale processors often source fresh milkfish
them. The wholesaler’s primary function is to from small vendors, while large-scale processors
transact with the consignacion in fishports. Typically, typically buy them from a consignacion and
wholesalers’ market outlets are commercial wholesalers who can supply in large volumes.
processors and supermarkets as they demand Large-scale processors supply supermarkets as well
enormous amounts of milkfish for local or as restaurants.
international markets.
 Asian Journal of Agriculture and Development Volume 20 Number 1 | June 2023 97

g. Distributors/retailers c. Nursery and growout

Distributors pertain to retailers occupying The larvae are reared into fry, which are
stalls in supermarkets and public markets who then distributed to nursery and growout operators.
sell the product to end consumers. The retailers Cages, pens, and ponds are the most common
unpack the milkfish from the containers and structures used in raising milkfish in Region
display these in stalls. In some cases, they would 1. For pond operations, the farmer prepares the
also remove the fish scales and slice the fish; pond by applying lime, fertilizer, and pesticide. On
they weigh the milkfish that customers wish to the other hand, cages and pens are repaired and
purchase to provide them an accurate price. The cleaned prior to stocking. Fishpond operators rely
COVID-19 quarantine protocols at the height mainly on natural feeds such as lablab3 and lumot
of the pandemic prompted market closures that (green algae), while cage and pen operators use
affected retailers. They resorted to selling to their commercially available feeds.
neighbors to avoid wastage and the deterioration
of milkfish quality. Retailers also struggled to d. Marketing and transportation
follow food safety regulations at the time because
of the inadequate storage and marketing facilities, Growout operators sort the marketable
such as the availability of ice, which is key to milkfish they produced according to size. Buyers
keeping their products fresh. negotiate the volume and price based on the
quality of the milkfish. Institutional buyers have
Activities and processes in the value chain better bargaining power compared with individual
customers. As earlier mentioned, the viajeros
a. Broodstock management transport the products primarily to fishports in
Metro Manila.
Broodstock management refers to the
raising of sabalo (i.e., sexually mature milkfish) for e. Processing
egg spawning and reproduction. Adult milkfish
weighs between 5 and 6 kilograms and measures The smallholder processors produce only
68–70 centimeters in length. For the first five deboned and marinated milkfish and sell them
years, the broodstock can be reared in cages, tanks, in public markets. Commercial processors also
and ponds. After five years, the broodstock is engage in value adding activities, such as bottling
transferred to breeding facilities using plastic tube and canning. They sell the products in local
bags and styropor bags or tanks in trucks. Eggs distribution channels and export markets.
produced by the broodstock are collected; after
14–18 hours, the eggs hatch into larvae. Flow of product, information, and payment

b. Larval rearing BFAR estimates that growout operators

bring around 80 percent of the total milkfish
The larvae are nourished upon hatching. production from Pangasinan province to the
Their natural foods, such as rotifers, are developed trading centers in Bolinao, Dagupan, and Alaminos
in semi-intensive hatcheries. When rotifers are towns. Only around 20 percent of the province’s
in short supply however, the larvae consume
plankton. Green algae and rotifers are added into
the tank on the second day of larval development 3
“Biological complex of cyanobacteria, diatoms,
(The Milkfish Technical Committee 2016). filamentous algae, and associated invertebrates that
occur initially on the pond bottom as a brownish,
greenish, or yellowish film.” ([Link]
fishery/affris/species-profiles/milkfish/production/en/)
98 | Normito R. Zapata Jr., Janelle Ayne C. Sarmiento, and Mar B. Cruz AJAD 20.1 | June 2023

production is brought directly to Metro Manila. by PHP 50–80/kg. Furthermore, producers who
In contrast, La Union province’s minimal milkfish usually sell in Dagupan City were unable to do
produce is sold primarily within the province only. so due to the city’s stringent entry restrictions.
The primary buyers are retailers in the province’s Similarly, those who had established regular market
public markets. outlets in Navotas and Malabon in Metro Manila
Vital pieces of information, such as prices, could not distribute the products to their regular
delivery schedules, and sources of inputs, are customers due to travel restrictions. As mentioned
shared among the industry players. Usually, earlier, the scarcity of ice during the pandemic was
other farmers and family members who are also another logistical challenge; milkfish cannot be
engaged in milkfish farming share information harvested if ice is unavailable.
on the possible sources of inputs. Seedstocks and
fingerlings are often sourced from hatcheries, External influences
agents, and wholesalers while agricultural inputs,
such as herbicides and fertilizers, are available at The milkfish industry in Region 1 is
agricultural input suppliers in public markets. supported by government and nongovernmental
Consignacion and brokers are the sources of organizations (NGOs) that develop technologies
information on the prevailing prices of milkfish. and policies for the aquaculture sector. These
However, those who do not transact with organizations are as follows:
consignacion obtain the information from other
farmers or the public market vendors. Payments a. SEAFDEC-AQD
are usually in cash. However, other producers who
lack the needed cash to start their farming activity SEAFDEC-AQD is an NGO hosted by
make a deal with financiers who provide them the Philippine government. The first successful
with inputs or funds to be paid during the harvest. induced spawning and larval rearing of milkfish
Credit arrangements between consignacion and took place between 1976 and 1978 at SEAFDEC-
buyers (viajeros/wholesalers) are quite prevalent. AQD. Since then, milkfish has been cultivated and
In this type of arrangement, the buyers request a reproduced in concrete tanks, ponds, and floating
payment term of two to three days after delivery, cages in the country. Larval rearing techniques
but the consignacion pays milkfish growers upon were successfully implemented in 1984, increasing
delivery. fry production substantially and giving milkfish
growers a plentiful supply while also generating
Logistics issues a market for milkfish exports. SEAFDEC-AQD
continues to support the milkfish sector through
Fingerlings and fry are transported from research, development, and extension (RDE)
hatcheries to nurseries and growout ponds. The activities.
fingerlings and fry must then be acclimatized prior
to their release into the primary culture systems b. BFAR
to minimize temperature shock that may result
in mortality. Heavy rainfall or typhoons usually BFAR is an agency under the DA that
bring about massive fish kills, reducing harvests provides technical assistance to fisherfolks through
significantly. Fish kills also happen in April or May seminars and trainings on production, marketing,
due to high water salinity. and business management. BFAR also distributes
The COVID-19 pandemic also created fry, fingerlings, processing equipment, and related
some challenges in milkfish [Link] abrupt supplies and services to growout operators.
implementation of travel restrictions forced
farmers to harvest their milkfish simultaneously,
resulting in oversupply that reduced selling prices
 Asian Journal of Agriculture and Development Volume 20 Number 1 | June 2023 99

c. DOST-PCAARRD location of the farm and the available natural

resources. For example, producers in Sual typically
PCAARRD is a council under DOST that use fish cages for growing milkfish at the Lingayen
develops strategies and projects for research and Gulf. On the other hand, fishponds are primarily
development (R&D) in the country’s agricultural, used in Binmaley, Dagupan, and Lingayen where
aquatic, and natural resource sectors. Among water can be accessed from the surrounding rivers.
other things, it secures government and external La Union follows Pangasinan in terms of
funding for the development of technologies and the volume of milkfish production in Region
innovations for the milkfish industry. PCAARRD 1. The total production in La Union represents
fosters collaborative R&D, human resource 4.6 percent of the total milkfish produced in the
development and training, and technical assistance region. On the other hand, the provinces of Ilocos
and facilitates the exchange of information and Sur and Ilocos Norte contribute 0.2 percent and
innovations with international and regional 0.01 percent, respectively, to total production. The
institutions. milkfish industry in Region 1 is valued at PHP
14.2 billion as of 2020 (Table 5).
d. Academe
Phase 1c: Understanding Value
Various state universities and colleges
support the milkfish sector in Region 1 such as As shown in Figure 3, each actor in the
the DMMMSU in La Union. Its RDE program milkfish industry contributes to value creation.
supports smallholder milkfish growout operators The growout operators bear the production risk
and processors. DMMMSU also collaborates with in rearing milkfish until it reaches the market
other government agencies for the delivery of weight. Hence, as shown in Table 6, growout
trainings and other support services. operators have the highest profit margin at PHP
17.1/kg of milkfish sold.
Phase 1b: Production Capacity On the other hand, the risks of losses during
transport and price fluctuations are borne by
Pangasinan province is the largest producer market intermediaries such as the consignacion,
of milkfish in Region 1, contributing 95.2 percent wholesalers, and viajeros. These players are the
of the total milkfish production in the region as ones who search for potential buyers and who
of 2020 (Table 4). The Office of the Provincial facilitate the transportation of fresh milkfish. As
Agriculturist named Bolinao, Anda, and Sual as shown in Table 6, they have a profit margin of
the major milkfish producing municipalities. The approximately PHP 7/kg of milkfish sold.
production methods used vary depending on the

Table 4. Volume of milkfish aquaculture production (in tons) by province in Region 1, 2016 to 2020
Volume of Milkfish Aquaculture Production (in Tons)
Province
2016 2017 2018 2019 2020
Philippines 398,088.17 411,103.47 395,130.31 409,906.56 414,488.93
Region I (Ilocos Region) 112,026.18 112,478.05 105,867.60 116,796.79 125,913.08
Ilocos Norte 19.21 20.27 33.97 15.52 10.36
Ilocos Sur 219.61 236.37 214.05 233.76 254.61
La Union 5,073.93 6,697.57 7,299.06 6,654.01 5,748.69
Pangasinan 106,713.43 105,523.84 98,320.53 109,893.50 119,899.42
Source: PSA (2021)
100 | Normito R. Zapata Jr., Janelle Ayne C. Sarmiento, and Mar B. Cruz AJAD 20.1 | June 2023

Table 5. Value of milkfish aquaculture production (in thousand PHP) by province in Region 1, 2016
to 2020

Value of Milkfish Aquaculture Production (PHP ‘000)

Province
2016 2017 2018 2019 2020
Philippines 35,042,257.39 37,623,623.34 40,767,835.02 42,879,624.07 43,379,111.83
Ilocos Region 11,325,023.86 11,779,513.63 11,849,710.30 13,560,732.38 14,185,627.85
Ilocos Norte 2,301.53 2,345.93 4,168.82 2,059.64 1,500.67
Ilocos Sur 23,187.48 26,033.25 23,708.64 28,158.30 36,462.86
La Union 537,161.71 703,043.14 838,641.55 839,756.21 747,806.33
Pangasinan 10,762,373.14 11,048,091.31 10,983,191.29 12,690,758.23 13,399,857.99
Source: PSA (2021)

Table 6. Profit margins of various players in the milkfish value chain in Region 1
Value Chain Players
Value
Growout Consignacion Wholesaler Viajero Retailer
Selling price (PHP)/kg 130.93 137.48 147.89 158.82 167.94
Total cost (PHP)/kg 113.86 130.93 140.85 151.26 159.94
Margin (PHP)/ kg 17.07 6.55 7.04 7.56 8.00

Source: BFAR (2021)

Note: These values are estimated for fishponds with area of 1 ha and milkfish with size 2:1.

Finally, the retailers facilitate the access estimated that the demand for milkfish fry in
of final consumers to fresh milkfish. They also Region 1 in 2020 was 269 million, but the total
provide consumers with diverse services such as supply of fry from the wild and the private and
degutting, cutting, and washing. The retailers also government hatcheries in Region 1 is only 109
bear marketing risks especially during periods million, leaving a deficit of 160 million. As a result
when consumers shift to other protein sources due of the shortage in the supply of eggs, operators
to an increase in the price of milkfish. The profit in Region 1 rely on one functional government-
margin of retailers is PHP 8.00/kg of milkfish sold. owned hatchery in the region, the BFAR-
National Fisheries Development Center (NFDC)
in Dagupan City. According to BFAR, the regional
CONSTRAINTS IN THE VALUE CHAIN and main satellite hatcheries were established to
produce milkfish eggs for distribution to other
satellite hatcheries. However, BFAR-NFDC could
Shortage in the Supply of Milkfish Eggs not supply eggs to satellite hatcheries because the
and Fry eggs produced are only sufficient for the needs of
the core hatchery4 itself. Despite this perceived
Stakeholders consulted from BFAR, insufficiency, it was found in a stakeholders’
SEAFDEC, DOST-PCAARRD, and private consultation that some hatcheries released
hatchery and nursery operators unanimously milkfish fry to the wild because they produced
identified “the inability to produce sufficient more than what they required. At the same time,
volume of milkfish eggs” as the primary constraint
in the hatchery sector. Figure 4 presents the 4
Maintains broodstock and produces milkfish eggs and
problem analysis in the seedstock node. BFAR fry as source of steady supply for satellite hatcheries
 Asian Journal of Agriculture and Development Volume 20 Number 1 | June 2023 101

Figure 4. Problem analysis for the seedstock node of the milkfish value chain in Region 1

Limited private sector investment in

Limited number of
broodstock maintenance due to high
broodstock/
capital requirement and long
hatcheries payback period

Seasonal spawning of sabalo

Insufficient supply
of milkfish fry Low productivity

Insufficient food for larvae due to

poor water quality

Limited information
Lack of coordination among
on the sources of
industry players
eggs/larvae/fry

other hatchery and nursery operators could not Bolinao towns. Overstocking and overfeeding
find a source of fry to meet their requirements. resulted in fish kill. While Bolinao town prohibits
With efficient coordination among hatchery and such practices, it cannot regulate through zoning,
nursery operators, the oversupply in one hatchery which is difficult to monitor. As a result, various
could be absorbed by another that is in need. local government units (LGUs) implemented a
Aside from the few legislated hatcheries,5 moratorium on fish pen operations in selected
only a few private entities are willing to invest in areas in Pangasinan. Figure 5 shows the problem
broodstock development, aggravating the shortage analysis for the growout node of the value chain.
in egg supply. SEAFDEC mentions that the capital
cost for broodstock development is quite high. Noncompliance of Small-Scale Milkfish
Moreover, since milkfish becomes sexually mature Processors to Food Safety Standards
only after four to five years, the private sector opts
to buy the eggs and/or larvae rather than raise its An ocular inspection of small-scale milkfish
own broodstock. processors in selected public markets in Pangasinan
revealed their noncompliance to food safety
Environmental Degradation standards. These small-scale processors lack the
facility to enhance food safety such as a vacuum
The main environmental issue in Pangasinan sealer and a stainless table. They pack deboned
is the obstruction of canal and river systems milkfish products into nonfood-grade plastics that
because of installed fish pens that are fixed are sealed with staple wires. Moreover, the disposal
[Link] pens are anchored on the lake floor, of the fish entrails and other wastes from milkfish
which is why they cause more pollution compared processing is not regulated.
with cages that are usually [Link] pens’ poles A stakeholder consultation showed that
accumulate sediment that further obstructs water many small-scale processors in Pangasinan have
flow. Unsustainable feeding practices also add to limited product lines brought about by limited
the problem such as what happened in Anda and facility and skills. Most of them are producing
marinated milkfish products because the process
is simple and requires readily available input, such
5
Facilities constructed based on government law/
mandate as vinegar.
102 | Normito R. Zapata Jr., Janelle Ayne C. Sarmiento, and Mar B. Cruz AJAD 20.1 | June 2023

Figure 5. Problem analysis for the growout node of the milkfish value chain in Region 1

Unsustainable feeding
practices (e.g., excessive
use of feeds)
Fish kill due to
Unsustainable farming
environmental
practices
degradation
Uncontrolled proliferation
of fish pens

One of the root causes of these problems in of technological innovations are available for
the processing node of the value chain is the lack various players in the milkfish industry. Table 7
of market incentive. The primary customers of the summarizes the technologies for process, product,
small-scale fish processors, the consumers in the and function upgrading.
public market, do not demand compliance to food The insufficient supply of milkfish eggs and
safety standards. Figure 6 shows the root causes of fry can be addressed by the core satellite hatcheries
the problem in the milkfish processing sector. program that BFAR and DOST-PCAARRD
implement. The program aims to establish core
hatcheries in strategic locations in the Philippines,
PHASE 2: OPPORTUNITIES FOR UPGRADING which will then supply milkfish eggs to satellite
THE VALUE CHAIN hatcheries owned by private investors. With this
arrangement, the long payback period and high
production risk involved in raising and maintaining
Technological Innovations a broodstock or sabalo will be taken care of by the
government-owned core hatcheries.
R&D agencies such as DA-BFAR, DOST- To address the problem of environmental
PCAARRD, DMMMSU, and SEAFDEC-AQD degradation due to unsustainable feeding practices
are in the forefront of developing technologies for of growout operators, the mechanized top- and
the milkfish sector in the Philippines. Document bottom feeders and plant-based milkfish diets
reviews and KIIs showed that a substantial number could be introduced. In a stakeholders’ FGD,

Figure 6. Problem analysis for the processing node of the milkfish value chain in Region 1

Lack of training on food

safety standards
Compliance to food safety
standards is not the focus of
most government
assistance to home-based
processors. Lack of market incentives
to comply with food
Noncompliance to food
safety standards
safety standards and
limited product lines
Several value-adding
activities (e.g., canning, Lack of training and
bottling, vacuum packing) equipment to expand
require specialized product line
equipment.
Table 7. Technological innovations for the upgrading of the milkfish value chain in Region 1
R&D Institution Process Upgrading Product Upgrading Function Upgrading
Seedstock producers
Automated fry counter Milkfish broodstock management and
Core satellite hatcheries hatchery practices
DOST-PCAARRD
DNA probe kits
Synbiotic feeds
Induced spawning and larval rearing Formula for milkfish broodstock diet
SEAFDEC-AQD Broodstock management, breeding, and High quality seeds
hatchery
Core satellite hatcheries Satellite community-based larval rearing
BFAR
facility
Growout operators
Mechanized top- and bottom feeders Diagnostic kits to detect off-flavor
Plant-based milkfish diets
DOST-PCAARRD
Paddlewheel aerator
Lablab drying and feeding management
SEAFDEC-AQD Cost-effective feeds
Various culture system
BFAR Liming, fertilizer, and pesticide application
Ad-libitum system
Milkfish processors
Provision of food safety-related tests such as Provision of production equipment such as
nutritional analysis, heat penetration test, drier, freezer, retort machine, and pressure
DOST Region 1
microbial test, shelf-life test, commercial, and cooker
sterility test
Safety protocol regulations and packaging ATBI
DOST-PCAARRD and Converting milkfish residues into ingredients
DMMMSU for feed formulation
E-marketing
Asian Journal of Agriculture and Development Volume 20 Number 1 | June 2023
103
104 | Normito R. Zapata Jr., Janelle Ayne C. Sarmiento, and Mar B. Cruz AJAD 20.1 | June 2023

the growout operators said that they are open to Hence, the intervention model being
exploring the new feeding technologies. proposed is the creation of a regional milkfish
Finally, noncompliance by small-scale seedstock command center (Figure 7). BFAR
milkfish processors to food safety standards can Regional Office 1 will act as the lead agency
be addressed through the Agri-Aqua Technology with the involvement of concerned agencies
Business Incubator (ATBI) program of the such as SEAFDEC-AQD, DOST-PCAARRD,
DMMMSU and DOST-PCAARRD. DOST and private companies. The LGUs should
Region I can provide support services, such as also be involved in this initiative since their
trainings, provision of equipment, and food safety- participation will improve the cooperation with
related tests. hatchery operators. Prior to technology transfer,
it is necessary to validate the demands of the
Intervention Models to Facilitate Access to operators to determine the suitable interventions
Information and Technology Adoption that will address the concerns of industry players.
This will enable better communication in response
To create a smart food value chain, each to the needs of the sector.
actor in the value chain needs to have better access The following are the functions of the
to high-quality information. Technology adoption proposed regional milkfish seedstock command
along the chain is equally important. Hence, three center:
intervention models were formulated to facilitate
the creation of a smart food value chain. The 1. Determine strategic locations for
ultimate goal of the following models is to facilitate legislated and satellite hatcheries.
technology adoption and access to information. 2. Maintain up-to-date database of available
milkfish technologies developed by
a. Establishment of a regional milkfish various Research and Development
seedstock command center Institutions (RDIs).
3. Maintain up-to-date directory of
As discussed earlier, the problems in the hatchery and nursery operators.
milkfish seedstock sector can be addressed through 4. Facilitate exchange of information (e.g.,
proper coordination. Technological interventions availability of excess fry, technological
and services of various agencies should be solutions, etc.) among hatchery and
harmonized to minimize gaps and overlaps in nursery operators.
providing technical support. Moreover, good 5. Provide feedback to RDIs on how to
coordination will allow hatchery and nursery improve technological interventions.
operators to match the supply and demand of 6. Identify research gaps and harmonize
various industry players for milkfish eggs, larvae, RDE initiatives.
and fry.

Figure 7. Structure of the proposed regional milkfish seedstock command center

 Asian Journal of Agriculture and Development Volume 20 Number 1 | June 2023 105

b. Establishment of a science and technology and Natural Resources to harmonize the efforts of
community-based farm (STCBF) both government agencies.
STCBF has the following proposed goals:
To abate environmental degradation due 1. Showcase various technological inter-
to unsustainable farming practices, it is being ventions for sustainable milkfish production.
proposed that technological solutions6 be 2. Offer diverse options that would match the
introduced to milkfish farmers. The stakeholders’ skills and available resources of milkfish
consultation showed that growout operators farmers.
are willing to use alternative feeds and feeding 3. Demonstrate how sustainable farming
practices as long as these are practical, effective, practices would not only reduce production
and cheaper Moreover, DOST-PCAARRD has and legal-political risks but also improve
milkfish farming and green technologies that productivity and income.
are ready for commercialization. While green
technologies are yet to be adopted in the field, an c. Creation of a bangus processing enterprise
effective technology transfer strategy is important. development hub
DOST-PCAARRD has developed the
STCBF to showcase the efficiency and effectivity of Small-scale fish processors must be equipped
various agricultural technologies. Capitalizing on with skills and technology to expand their product
the initial success of the STCBF, the same modality lines and to improve their compliance to food-
is proposed to be used to facilitate transfer of safety standards. This should be accompanied by
technologies, such as automatic feeders and plant- market incentives that would motivate them to
based feeds, to milkfish growout operators. This adopt technological solutions. Hence, it is being
intervention is proposed to be implemented in proposed to create a bangus processing enterprise
partnership with the Department of Environment development hub (Figure 8).

Figure 8. Structure and role of the bangus processing enterprise development hub

6
Pertain to green technologies, such as automated
feeders and plant-based feeds, which reduce water
pollutants caused by excessive feeding; improves farm
operations’ sustainability.
106 | Normito R. Zapata Jr., Janelle Ayne C. Sarmiento, and Mar B. Cruz AJAD 20.1 | June 2023

Figure 9. Implementation phases of the bangus processing enterprise development hub

PHASE 1 PHASE 2 PHASE 3 PHASE 4

Profiling and Targeting Capacity Building Mentoring Scaling Up

Processors use their

own capital to expand
operation
Processors become
compliant with food - Processors are Processors avail the
safety standards and trained and assistance of DOST -
would like to expand mentored under the SETUPto expand
ATBI operation
Small-scale product lines
- Industry partner
milkfish proces- provides guidance Processors use the toll
sors Processors become processing facility of
compliant with food BFAR to expand
safety standards but operation
are not interested to
expand product lines

With DOST Region 1 as the lead agency, and market planning. Also, the role of mentors
the hub will perform the following roles: from the academe and the industry will be crucial
1. Harmonize all interventions for milkfish during this stage.
processors. In the last phase, the small-scale processors
2. Become the one-stop shop for technical and will be assisted to scale up their operations. Some
enterprise development support. would opt to use their own funds for the expansion.
3. Maintain up-to-date directory of home- However, for those with limited financial resources,
based and commercial-scale processors. they may avail of DOST-SETUP7 assistance in
4. Develop programs that will cater to the acquiring processing equipment and tools. On the
specific needs of milkfish processors. other hand, some may opt to simply use the toll
5. Assist in the marketing and distribution of processing facilities of BFAR Region 1.
processed milkfish products.

The intervention model could be CONCLUSION

implemented in four phases (Figure 9). In the
first stage, the hub will profile the small processors Milkfish or bangus (Chanos chanos) is the most
and determine what aid they already received and popular fish species cultured in the Philippines.
what additional assistance they need. Initially, the Region 1, particularly the province of Pangasinan,
strategy will focus on identifying assistance that is remains to be the largest producer in the country.
needed by small-scale processors in coordination However, persistent issues in the industry hinder
with DMMMSU, BFAR Regional Office 1, and its productivity and growth. The value-chain
LGUs.
In the second phase, the small-scale
processors will be trained and equipped to meet 7
The Small Enterprise Technology Upgrading Program
(SETUP) provides micro-, small-, and medium
the minimum requirements for food safety. This enterprises with equipment and technical assistance
may involve providing common-use facilities in through: (1) seed fund for technology acquisition,
strategic locations. The progressive small-scale (2) needed equipment/upgrading, (3) technical
processors will advance to phase 3, wherein the trainings and consultancy services, (4) packaging and
label design, (5) database information systems, and
processors will learn new techniques in milkfish (6) support for establishment of product standards,
[Link] involves new product development including testing, and calibration of equipment
([Link]
 Asian Journal of Agriculture and Development Volume 20 Number 1 | June 2023 107

approach was used to dissect these issues. The REFERENCES

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net/20.500.12348/2342
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to create a smart food value chain for milkfish Bassig, and E.C. Zaragoza. 2010. “Value Chain
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aimed to harmonize various institutions’ efforts to WorldFish Center.
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industry players to manage the supply and demand Research.” Aquaculture 498: 428–434.
for milkfish eggs and fry. The second model is German, J.D., and M.A.G. Catabay. 2018. “Analysis
of Milkfish Supply Chain in the Philippines:
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A Case Study in Dagupan, Pangasinan.” AIP
STCBF will be used to assist growout operators
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