A feasibility study of establishing a Carrageenan Processing Plant in Palawan

Date

1999

Degree

Bachelor of Science in Agribusiness Management

College

College of Economics and Management (CEM)

Adviser/Committee Chair

Montealto, Daisy J.

Abstract

Palawan is the largest province in the Philippines consisting of 1,768 islets. The large coastal water in Palawan provides a good habitat for marine and aquatic life forms. It is the third largest producers of seaweed in the Philippines in 1997. Palawan produced 142,365 MT of seaweed out of 624,479 MT total production of the Philippines. One of the incentives of processing seaweed is the added value to the seaweed and it will be one key towards the achievement of the economic development of Palawan. In connection with this, a feasibility study establishing a carrageenan processing plant in Palawan was conducted to present an overview of the local seaweed industry, to determine the technical, organizational, and financial feasibility of the project, to determine the market potential of semi-refined carageenan; to determine the socio-economic effects of the processing plant; and finally to identify the potential problems of the project and recommend solutions that will address these problems. Primary data were obtained from actual interview with the seaweed farmers in Palawan and seaweed processor, MCPI, in Mandaue City, Cebu. Secondary data were gathered from different institutions like the Bureau of Agricultural Statistics (BAS), National Statistics Office (NSO), Department of Trade and Industry (DTI), Department of Export Trade and Promotion (BETP), Philippine Council for Aquatic and Marine Research and Development (PCAMRD), and CEM Library. Marketing, managerial, technical and financial data were gathered through interview with the management and staff of MCPI. The Net Present Value, Internal Rate of Return, Return on Investment, and Payback period were used to assess the financial viability of the project. A one-hectare land located in Brgy. San Jose, Puerto Prinsesa City, classified as medium Industrial Zone, is needed to establish a semi-refined carageenan processing plant with 2,000 MT annual capacity. The Provincial Government of Palawan will finance forty-five percent (45%) of the total project cost while the remaining fifty-five percent (55%) will be sourced out from the private investor. The Provincial Government of Palawan will also be responsible for the sourcing of raw material in the form of contract growing with seaweed farmers cooperative. The Provincial Government of Palawan will finance the seedlings and materials at the initial stage of the operation. Some possible areas where will come from are Agutaya, Cuyo, Cagayancillo, Roxas, Balabac, Taytay, Araceli, Quezon and Linapacan. The private investor will be responsible for the technical supervision and marketing of the semi-refined carrageenan in United Kingdom (30%). United States of America (25%), France (25%), and Australia (20%). A total investment of P217,299,589 is needed to establish a semi-refined carrageenan processing plant. This is broken down as follows: fixed investment of P70,850,000, and initial working capital P146,449,589. Based on the results of the study, the project is financially feasible with computed Net Present Value (NPV) of P97,953,804, Internal Rate of Return (IRR) of 47% and Payback period of 6.09 years.

Language

English

Location

UPLB Main Library Special Collections Section (USCS)

Call Number

LG 993 1999 M17 A76

Document Type

Thesis

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