LogMan Module 2: Logistics for Rural Markets

Factors to consider in reaching products to rural markets or for farmers to sell their produce to the world:

1. Storage of the agricultural produce is at the farms and liable to deteriote in quality
2. Intermediaries, brokers, agents are the major element of the cost
3. For logistics of agricultural produce, it is mostly a seasonal business. One has to keep idle in other seasons
4. Transporters are not willing to take the trip into the rural markets as return loads are not available

Farm to Market
http://www.da.gov.ph/images/PDFFiles/FMR/2015/FMR_Rationale.pdf

DEPARTMENT OF AGRICULTURE
FARM-TO-MARKET ROAD (FMR) NETWORK PLAN

I. RATIONALE

The Department of Agriculture (DA), in order to fulfill its mandate of raising farm income, undertakes various infrastructure projects such as construction, restoration and rehabilitation of irrigation systems, post-harvest facilities and farm-to-market roads (FMRs). These projects are aimed at increasing production, reducing production cost, minimizing postharvest losses, and expanding market opportunities towards better living for producers and consumers alike. Farm-to-market roads are the foundation of modern agriculture. FMRs improve mobility of goods and services – both agricultural and non-agricultural – in and out of the area. It also improves mobility of people giving them better employment opportunities within and outside the area. In agriculture, it improves delivery of production inputs, execution of extension services, and processing and marketing of produce. By providing market access to farmers, they become motivated to plant more, increasing production and thereby, increasing their incomes. While not directly contributing to agricultural production, FMRs serve as catalysts in improving rural economy. A total of 48,350 kilometers (kms.) farm-to-market roads is required to be constructed in the country.1 As of March 2010, about 33,361 kms. of roads have already been constructed leaving a balance of 14,989 kms. The DA’s target is to construct 13,999 kms of FMRs from 2011-2017. As of 2013, DA has already completed 1,108 kms of FMRs. For 2014, the DA targets the construction and rehabilitation of 1,000 kms. of FMR. On the other hand, 2,346 kms. of FMRs will be constructed under the Philippine Rural Development Program (PRDP) during the entire period of implementation. 

II. OBJECTIVE
The main objective of the FMRDP is to fill the gap between the required and the developed FMRs in the country. It aims to construct, restore and rehabilitate rural roads. Specifically, the program aims to: 1. Reduce cost of transportation of farm inputs and outputs as well as minimize postharvest losses by providing efficient means of transportation in rural areas; 2. Improve access of farmers, fishers and residents in the area to basic services such as education and health among others; and 3. Connect farms/coastal areas to main roads to promote Agro-Tourism. 1 AusAID Road agenda on transport plan, March 2010

III. Policies/Strategies to Ensure Timely Implementation of FMR Projects KEY AREAS POLICIES

1. Prioritization of projects a. Formulation of project selection criteria b. Preparation of FMR Network Plan in coordination with LGUs, District Representatives and resident- farmers and fisherfolks c. Preparation of Network Plan in coordination with other agencies such as National Anti Poverty Commission, Department of Interior and Local Government, Office of the Presidential Adviser on Peace Process to ensure that there are no duplication in the list FMR projects to be implemented

2. Ensuring the riqht cost and quality of projects a. Coordination with DPWH-DEOs to ensure that the detailed design, program of work, and detailed cost/estimates are evaluated based on restructured indirect/direct costs b. Early coordination with LGUs to ensure that they have the capacity to implement the projects. Parameters for assessment shall include: track record, readiness, absorptive capacity and with Seal of Good Housekeeping c. Application of the Geo-tagging Technology before, during, and after the project implementation. LGUs are required to provide their own geo-tagging equipment d. Conduct of joint inspection with DPWH/LGUs e. Hiring of third party agency/organization to monitor compliance with construction specifications and project schedule and evaluate the quality of FMRs implemented.

3. Ensuring the timely implementation of projects a. Close coordination with the implemeting agencies to ensure that the requirements for implementation of the projects have been complied (prior to the release of SARO) b. Conduct of conduct site validation visits to verify the accuracy of submitted documents /requirements c. Da-Regional Field Units to facilitate the bidding process in case LGUs are not qualified to implement the projects d. Monitor the physical implementation of respective projects to ensure that they are in accordance with the provisions stipulated in the MOA e. Designation of a focal person for FMR (per RFU) which will manage and coordinate the implementation of FMR projects in the area f. Establishment of alert mechanisms to ensure timely resolution of issues that may arise before, during and after project t implementation.