Over the last couple of years, the supply of coco peat for the horticultural industry has not been easy. The weather in production countries like Sri Lanka and India, a shortage of processing facilities, logistical challenges, and then Covid-19 have all been great challenges for the industry. When the management team of Biogrow visited the Philippines 4 years ago, they saw the possibilities of creating a new production site there, and this year, the first containers are being shipped from that site.
Expanding sourcing locations
Biogrow is a fully integrated producer of coco peat substrate with production locations in Sri Lanka, India, and Brazil. Since the coconut industry has been through hard times, with weather and logistical challenges posing risks to the supply chain of coco peat growing products, they have been on the lookout to expand their sourcing locations. With the Philippines being the second-largest producer of coconut, behind Indonesia, they expect the country to have huge potential for raw material. “Then there’s the proximity to China and other emerging countries,” says Clément Jacquot. “It was clear we’d found the right location.” After working with Biogrow in Sri Lanka, he arrived in the Philippines at the end of 2019, having already begun the incorporation of the new structure from outside the country. Now he is the official director of Biogrow Philippines.
Realistic targets and partnerships
Starting a coco company in the Philippines is quite a challenge, as the country itself also poses many challenges – for example geopolitical, administrative, and climate – which resulted in several coco suppliers trying to leave the country prior to Biogrow's arrival. And of course, since the beginning of 2020, there has also been the global Covid-19 pandemic to contend with. Yet, Clément has remained optimistic from the start. “I was certain that if we were to aim for realistic targets and work in partnership with local communities, everything would eventually fall into place. It was just a question of time and patience.”
The first 6 months were spent looking for the right location for the factory. “Eventually, we came across a perfect site, which was close to numerous coconut groves and had good transport access, and, most importantly, favorable weather! We had found a former coconut oil mill, which had been closed down for the last 20 years, and we saw this acquisition as a unique opportunity to bring this industrial estate back to life as well as to create jobs in this (still) very agricultural part of the country.”
After acquiring the land in the second half of 2020, the Biogrow team quickly started renovating and reconnecting the electrical lines to begin further construction and machine installation. At the same time, they had to register their company with the relevant local administrative and government agencies. “Starting in a new country as a foreign investor can be a long and arduous process. There’s always a lot to learn when you’re dealing with a new legal system and judicial environment. That being said, the Philippines have been trying to ease this process for the past few years, and with the help of the European Chamber of Commerce of the Philippines, we managed to navigate our way through it successfully,” Clément recalls.
At the beginning of 2021, the first building permits were granted, the electricity was finally connected, and the machines started to be delivered from abroad. The team also began to grow as Biogrow started recruiting and training staff to work in what is an entirely new industry for most of them. By April they started production with their first operational chipping mill, and every new machine installed thereafter created new jobs at the plant. Alongside all of this activity, the work that was started 2 years earlier with their local NGO began to take shape as well. “Following a number of events to promote the coconut husk valorization program, many local cooperatives had agreed to join our sustainable development program, and after a short period of training were soon supplying or transforming coconut husks,” says Clément. “For this purpose, we also started to work on the construction of a dedicated training center which would offer the unique chance to practice a large-scale technology and knowledge transfer to boost the local economy and valorize the hundreds of millions of husks produced in the region every year. With the target to work directly with 3000-5000 coconut farmers, we believe we can play an important part in reducing poverty in the region while creating a new and resilient husk transformation economy at the regional level.”
Bales & growbags
“Thanks to the great efforts and dedication of our team, the first trial container was finished and exported in August, which marked a big milestone for the factory” Clément went on to say that “currently, we are in full production with 200L bales, and soon we will be able to deliver 5kg of bales. We are also pushing to develop the production of grow bags, and by 2022, we will be able to produce the entire Biogrow range of substrates. We still have a long way ahead of us to reach our full capacity and full potential, but with the launch of this new production site, we are more confident than ever that our clients all over the globe will always be supplied with the best quality substrates on the market.”