THE Board of Investments (BoI) approved the application for registration of Purefoods Hormel Co. Inc. on February 21 as an expanding producer of processed meat under the preferred activities of the Agribusiness and Fishery sector of the current Investment Priorities Plan (IPP).
The P5.68-billion project qualified for “commercial processing,” which entails the conversion of agricultural and fishery products or wastes to a form ready for further processing or final consumption.
Trade Secretary and BoI Chairman Ramon Lopez lauded this project component saying “the undertaking supports the thrust of the administration to further promote rural and value chain development toward increasing agricultural and rural enterprise productivity.”
The company, which is a joint venture of conglomerate San Miguel Corp. and Dutch firm Hormel Netherlands Inc. has been into meat processing since 2006.
The project which is expected to start commercial operations in December 2017, will increase the company’s current capacity of 60,000 metric tons per year (MTPY) by an additional 61,200 MTPY, effectively doubling the capacity of its plant in General Trias, Cavite.
Once operational, the company will hire an additional 1,242 personnel to boost its operations. It will use domestically produced and imported raw agricultural products. Locally sourced raw materials include meat, spices and casings.
The trade department said that around 98 percent of the produce will be sold to the domestic market with the remaining earmarked for the export market.
Hogs, a major raw material in the production of hotdogs, will be raised using feeds made out of cassava that the company plans to source from the farmers in its area of operations.
Through the company’s Cassava Assembler Program, about 500 individual farmers are organized into a cooperative that cultivates about 500 hectares of cassava plantation.
A hectare can produce around 1,000 to 1,500 metric tons of cassava. The cassava yielded will be solar dried and processed into cassava feed chips which will then be supplied as hog feeds.
The program features a guaranteed market with purchase agreement, guaranteed floor prices, start-up technical assistance, and research and development activities to improve yield and quality.
Lopez also said that the project is in line with the government’s inclusive business (IB) thrust which aims to reduce poverty, generate more jobs, and sustain inclusive growth.
The BoI, he said, is encouraging registered enterprises to adopt IB strategies that provides goods and services, income and decent work opportunities for the low-income segment of the society within the enterprise’s supply or value chain, directly contributing to the improvement of living standards and poverty reduction.
Purefoods Hormel is one of the largest meat processors in the country.
The meat processing industry in the Philippines has an annual market of P300-billion and provides jobs to around 300,000 Filipinos, according to data from the Philippine Association of Meat Processors Inc.