Freeing Surigao farmers from vicious debt cycle

ONE of the new harvesters that have made farm work easier in Carrascal town, Surigao del Sur CONTRIBUTED PHOTO

Carrascal, Surigao del Sur—RICE farmer Juanito Estrada used to spend a back-breaking week to harvest his yield. When harvesting is done, his focus shifts to the debts that his family has racked up for the planting season, as farmers like him commonly borrow money to defray the soaring cost of farm inputs.

When the harvest season was over, the 71-year-old Estrada said he would have earned barely enough to repay money lenders who often charged high interest rates.

To help break this vicious debt cycle, Estrada and other farmers belonging to the Cantilan Irrigation System Federation of Irrigators’ Association (Cisfia) and nickel miner Marcventures Mining and Development Corporation (MMDC) have joined hands to open an interest-free credit facility worth P5.2 million.

Signed early this year, the “farm now, pay later” loan agreement has benefited Cisfia’s over 14,000 farmers and their dependents. Cisfia was a group of 13 irrigator associations in Cantilan and Madrid towns, said Cisfia president Elvie Arrubio.

Payable in three years, Arrubio said the P5.2 million loan had already funded the purchase of two brand new harvesters costing P3 million. The remaining funds were used to purchase two vehicles to transport members’ produce.

Estrada said the harvesters had significantly reduced the one-week harvest time to just an hour.

“From one week of normal harvest time, it’s now down to an hour. What a relief,” said Estrada, who has three children although only one is into rice farming.

Arrubio, the Cisfia president, underscored the value of acquiring new harvest equipment, noting that the federation’s lone harvester could barely serve all members who tilled their farm area, which is about 3,000 hectares.

Arrubio said the old, cranky harvest machine had already cost members P300,000 in interest alone. They borrowed the money to buy the machine two years ago from a local lender who charged 24 percent in annual interest.

Because the new equipment were purchased without interest, not only would members be freed from loan obligations, Arrubio said, “but we can also reduce harvest-related costs.”

He said the financial assistance could not have come at a better time, noting that farmers nationwide were currently bearing the brunt of severe drought caused by the El Niño phenomenon.

Arrubio said she hoped the scheme would be adopted by other mining communities as well to help farmers cope not only with escalating production costs, but also cushion the impact of climate change.