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Rattan: A source of employment for upland communities of Northeastern Luzon


Introduction
The Rattan industry
References


Artemio T. Antolin,
Assistant Division Chief, Forest Resource Development and Concurrent CFP-NRMP Regional
Coordinator DENR Regional Office No. 2, Philippines

Introduction

The area

Northeastern Luzon, which embraces Region 2 of the Philippines archipelago, has a total land area of about 2,683,658 hectares. Commonly called the Cagayan Valley, this region is a north-south oriented sedimentary basin bounded on the western flank by the Cordillera mountain ranges and the eastern and southern flanks by the Sierra Madre and Caraballo mountain ranges. The Cagayan River, which is the principal drainage system for the valley, flows into the South China Sea.

The mountains are generally covered with dipterocarp forests which include numerous non-timber forest products such as rattan, "nito bamban" and many others. All are a source of livelihood for the upland communities living nearby.

In 1990, according to the Regional Statistics Office, about 1.8 million people inhabited the region. The highest proportion of the population are Ilocanos and Ibanags. Smaller groups, known as Indigenous Cultural Communities (Agtas, Ilongot, Dumagats), also inhabit the forest areas.

Rattan is plentiful and one of the major sources of livelihood for communities living in the forest. It is also a premium material for the furniture industry, which at present is short of wood. The logging ban in the region has awakened the industry's keen interest in rattan which can be manufactured into elegant, world-class furniture and handicrafts.

Opportunities for the rattan industry

Along with providing a direct source of employment for rural communities, rattan plays an important role in the ecosystem, as well as in the national economy.

Rattan is one of the most essential non-wood forest products in the country. This is due to its remarkable beauty, low cost, versatility, malleability and renewability. These qualities make it almost impossible for wood, metal, plastic or any other material to challenge rattan's premier position in the furniture industry.

According to a study by the Appropriate Technology Association, there are 259 companies now involved in rattan furniture and handicraft manufacturing. Although these companies are established in urban centres such as Metro-Manila, Cebu and Angeles City, most of their raw materials are supplied by rural rattan gatherers.

The rattan industry is composed of small-and-medium scale factories. The medium-scale factories, each of which employ 400 to 1,000 workers, provide the most employment. The small-scale factories each employ between 20 and 250 workers.

The country takes pride in its valuable rattan resource, but due to growing demand, both locally and internationally, rattan has been over exploited and supplies are now at a critically low level.

This depletion has been caused by indiscriminate collection by local gatherers who are pushed by the furniture industry to supply raw materials, and aggravated by continuous logging, slash-and-burn farming and forest fires.

The Rattan industry

Rattan supply and demand

The sustainability of the rattan industry depends largely on the availability of raw materials. According to the RP-German Forest Resource Inventory (FRI) cited by Wakker (1991), the total estimated rattan stock, as of 1987, is shown in table 1.

Using DENR's ratio of 1.3 linear meters of rattan required for $US 1.00 of exported furniture, industry requirements for rattan poles were estimated to be 153.71 million linear meters in 1991. Based on an average 10 percent growth per year, demand is projected to increase to 1.4 billion linear meters by the year 2015 (table 2).

It is estimated that if no rattan plantations are developed, the demand for rattan will exceed supplies by 1.2 billion linear meters by 2015 (table 3).

At the regional level, the demand of local producers in 1994 was 8,703,552 linear meters and is projected to-increase at an annual average rate of 10 percent annual average rate of 10 percent (Department of Trade and Industry, 1994).

Table 1. Standing rattan stock in old growth and residual forests (all commercial species)

 

Philippines

Region 2

Production area in Region 2

million linear meters

percent

million linear meters

percent

million linear meters

percent

Old growth
Residual forests

1,707
2866

37.3
62.7

864
592

59.3
40.6

226
302

42.8
57.2

Total

4,573

100.0

1,456

100.0

528

100.0

Source: Modified from FRI, 1987; Serna, 1990 as cited by Wakker

Table 2. Estimates of rattan pole requirements based on projected value of exports (1991-2015)

Year

1991

1992

1993

1994

1995

2000

2005

2010

2015

Value of exports (US$1,000,000)

118.24

121.31

133.44

146.79

161.46

260.04

418.80

674.4

1,086.25

Rattan requirements (million linear meters)

153.71

157.70

173.47

190.82

209.90

338.05

544.44

876.81

1,412.13

Assumptions:

Projections of the further demands for rattan poles are based on industry estimates of a 10 percent annual growth rate in exports of rattan furniture. Rattan pole requirements are estimated on the basis of 1.3 linear meters for every US$ 1.00 of sales.

Table 3. Estimates of the shortage of rattan poles from natural stand vis-a-vis industry demand (in million linear meters)

Year

Demand

Supply

Gap

Small Diameter

Large Diameter

Small Diameter

Large Diameter

Small Diameter

Large Diameter

1993

104.08

69.49

110.9

65.5

+6.82

-3.89

1994

114.45

76.33

110.9

65.5

-3.59

-10.83

1995

125.94

83.96

110.9

65.5

- 15.04

- 18.46

1996

138.53

92.36

110.9

65.5

- 27.63

- 26.86

1997

152.39

101.61

110.9

65.5

-41.49

-36.11

1998

167.62

111.75

110.9

65.5

- 56.72

- 46.25

1999

184.39

122.53

110.9

65.5

- 73.49

- 57.43

2000

202.83

135.22

110.9

65.5

-91.93

- 69.72

2005

326.66

217.77

110.9

65.5

-215.76

- 152.27

2010

526.09

350.73

110.9

65.5

-415.19

- 285.23

2015

847.27

564.85

110.9

65.5

- 736.37

- 499.35

Source: Product Profile Series Bureau of Export Trade and Promotion 1992

Estimates indicate that, up to the year 2001, supplies of natural rattan in Region 2 will exceed demand. Starting in 2002, however, supplies from natural sources will no longer be sufficient (table 4).

Table 4. Rattan supply and demand status in Region 2

Year

Demand

Supply

1994

8,703,552

17,168,181

1995

9,573,907

17,168,181

1996

10,531,298

17,168,181

1997

11,584,428

17,168,181

1998

12,742,870

17,168,181

1999

14,017,158

17,168,181

2000

15,418,873

17,168,181

2001

16,960,761

17,168,181

2002

18,656,837

17,168,181

2003

20,522,520

17,168,181

2004

22,574,772

17,168,181

2005

24,832,250

17,168,181

2010

39,992,586

17,168,181

2015

64,408,460

17,168,181

Harvesting, trade and utilization

People involved in the rattan industry are classified as gatherers, traders, processors and manufacturers.

Gatherers

About 1,000 to 2,500 people collect rattan in Region 2. Practically all these gatherers live in upland villages. These include tribal people like the Dumagats, the Agtas, the Ilongots and other groups. The rattan is gathered for either subsistence needs or trade (barter and cash). Rattan poles or splits are bartered for goods such as rice, liquors and spices.

For most uplanders, rattan gathering is a part-time activity. Their investments are physical effort and time spent gathering (3 to 7 days to collect 200 to 280 poles). Payment is generally very low, ranging from between P 200 and P 450 (US$7.70 to US$ 17.30) per month for part-time gatherers, and from between P 650 and P 1,470 (US$ 25.00 to US$ 56.50) for full-time gatherers.

Traders

Traders in Region 2 number from 50 to 250. These are either village-buyers, head cutters, licensees or middlemen.

The village-buyers or head cutters usually live within or near gatherers' villages. They are intermediaries between the cutters and buyers. Some even join the gatherers and act as team leaders, while others simply arrange for gathering and selling the harvest. They receive between 5 centavos and one peso per pole. Their monthly incomes from the rattan trade range from P 330 to P 1,650 (US$ 12.70 to US$ 63.50).

Licensees are given permits for rattan-gathering on a specific block of land. They tend to live in larger towns and have representatives taking care of operations and trade.

Another group of traders are the middlemen. Some middlemen buy rattan from gatherers to ship to major centers like Manila and neighboring towns. Others are based in Metro Manila and buy newly-transported rattan from the region for resale to manufacturers.

Processors/manufacturers

The breakdown of rattan poles into wicker and splits is either done manually or by machine. Traders and manufacturers pay workers P 0.15 to P 0.25 (less. than US$ 0.01) for each pole. The price per bundle of split rattan is P 0.15 ($US 0.01) per 50 pieces of malaccas (malaccas are produced by splitting off the skin from the rattan poles with a hand-operated tool). Wakker (1991) estimated the number of processors involved in the manual processing of rattan to be between 100 and 350 people, but indicated estimates of processors and their incomes were very difficult to obtain.

Manufacturers' finished products include rattan furniture, baskets, gift items and housewares. The rattan furniture sector accounted for about 70 percent of annual Philippine furniture exports between 1986 and 1991 (Department of Trade and Industry, 1994). Rattan furniture production in Region 2 earned P 77.4 million ($US 3.0 million) in 1989, decreasing to P 64.0 million in 1990.

Problems

1. Limited Raw Material: The present volume of available raw material from natural stands will only last to the year 2001, as shown in table 4. With increasing demand, the demand/supply gap will continue to widen.

2. Labor Problems: Most of the rattan gatherers are poor rural people, especially those from the uplands who live near or adjacent to the forests. These gatherers, who include tribal people, experience considerable herds-hip in climbing the mountains and carrying down their harvest, and are paid very little compared to the middleman and permitters. On the other hand, furniture companies are facing problems with increasing labour costs. Labour has become so expensive that it accounts for as much as 30 percent of the value of finished rattan products (Department of Trade and Industry, 1994).

3. Competition: The Department of Trade and Industry anticipates-that Indonesia poses a serious threat to the Philippine rattan export industry. Indonesian rattan furniture exports registered a remarkable annual growth rate of 61 percent in recent years.

Prospects

The export value of Philippine rattan furniture is projected to grow from US$ 121.3 1 million in 1992 to US$ 212.14 million in 1996; an average annual growth rate of 15 percent.

In order to attain this growth, and to sustain the rattan industry, the following measures should be adopted:

1. Strict implementation of regulations aimed at ensuring the sustainability of, and access to, rattan resources.

2. Establishment and development of rattan plantations.

3. Use of rattan products in combination with other materials like wood or metal.

4. Organization of rattan gatherers to ensure the proper protection and management of rattan resources. In return, they should be given priority rights and privileges to extract and utilize the resource.

References

Department of Trade and Industry. 1994. Profile of rattan industry in Region 2.

Serna, C.B. 1990. Rattan resources supply situation. In N.K. Toreta and E.H. Belen Proceedings of the National Symposium/Workshop on Rattan. Cebu City.

Wakker, E. 1991. The economic value of rattan trade in Region 2, Philippines. Student report, Leiden.

Rattan collection and processing employs thousands of rural people, including many tribal forest dwellers.


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