On the remote South Pacific coasts of the Philippines, small-scale seaweed producers have historically faced challenging weather conditions such as typhoons, floods and droughts, which affect 60% of the total arable land and 74% of the Philippine population. These small-scale producers are also affected by economic difficulties, as, despite growing a product in high demand, their access to the market is limited and unequal.

Inequality in the seaweed market

Despite the growing demand for seaweed for the production of carrageenan, a substance used in the food, pharmaceutical, and cosmetic industries, small-scale Filipino producers find themselves trapped in an unfair supply chain. In remote areas of the Philippines, the Intermediaries dominate the marketing process, setting low prices for farmers while selling to private companies at much higher prices. Seaweed producers, being far from the main international market players, are forced to sell their products quickly and under disadvantageous conditions to survive, unable to negotiate fair prices or access better trading opportunities.

This imbalance leaves producers with insufficient income to cover their families' basic needs, perpetuating a cycle of poverty and economic dependence.

CODESPA's intervention 

From CODESPA Surigao del Sur, specifically the municipality of Hinatúan, was identified as one of the provinces most exposed and affected by this situation, and it was decided to act in this area to support small seaweed producers and connect them directly with private companies, distributing the value more equitably.

It was then that, in 2021, with the support of Julius Baer Foundation, decided to boost the Hinatuan Seaweed Producers Association (HSWPA), designed to reduce inequality in the seaweed market by providing entrepreneurial training to local producers, helping them consolidate as a local organisation, and connecting them with international buyers such as CEAMSA, a Spanish seaweed processor based in Manila.

Trust as the key to success

The initiative has been helping more than 400 producers to improve their living conditions. By connecting them directly with the private sector, they have seen their incomes increase by up to 80%. Furthermore, the direct relationship with CEAMSA has enabled farmers to sell their produce at much higher prices and improve the quality of the seaweed in line with international standards. Now, the carrageenan they produce does not require any additional cleaning or sorting, which has increased efficiency for both the purchasing company and the farmers.

From association to cooperative, the importance of access to finance

Despite the success achieved, they are aware that a very significant barrier still exists: access to financing. Many small producers still depend on selling their products quickly to cover immediate needs. It is then that CODESPA begins the search for clients, funders, and national and international allies so that the association can transform into a cooperative with which it can receive credit.

In this way, in May 2024, it was born Hinatuan Seaweed Farmers and Fishermen Cooperative (HISPA-CO), a cooperative that takes on the role of coordinator and organiser for producers in financial and administrative functions.

Now, they have received their first credit from Open Value Foundation, This makes them the new cooperative's first ally by granting it. This will help them to continue growing, expanding and improving their production by being able to acquire new tools and resources.

In addition to this significant advancement, new avenues for innovation are being explored to ensure environmental sustainability in algae cultivation and to foster a circular economy approach. This includes the reuse of algae waste for the production of biofertilizers, ensuring that every part of the process benefits the community and the environment.

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Main sources of information: https://www.codespa.org/blog/2021/01/03/algas-como-negocio-inclusivo-en-filipinas-para-acabar-con-pobreza/, https://www.codespa.org/proyectos/algas-cadena-de-valor-sostenible-wealth-unequality-forum/, https://www.codespa.org/blog/2024/06/24/un-dia-en-la-comunidad-vale-mas-que-1-000-informes/