2. Proponent
Cooperator Quisumbing United Agrarian Reform Beneficiaries Association
Farmers Cooperative (QUARBA)
Registration No. CDA Reg. No.: CIN-0101100106
Year Established 1991
Business Activities: Citronella production and processing
No. of Years in Operation 23
Cooperator’s Location Sitio Rocha, Impalutao, Impasugong, Bukidnon
No. of beneficiaries
Direct 130
Indirect 9 + 1 Association
No. of MSMEs created/
assisted
5
No of Employment
Existing 3
Additional 10
I. Project Profile
3. Problems /Manufacturing Gaps/Bottlenecks that Needs to be
Addressed
Lack of an additional facility to address increase in production for another
processing site.
Difficulty in complying the quality standard set by Gandang Kalikasan, Inc. and
other buyers.
4. Php : 616,000.00 Proposed SSF Amount:
SSF Equipment Specifications
(details of the
equipment including
its rated capacity)
Quantity Unit Cost Amount
Steam Distillation Machine
Extract citronella oil
- 350 kilo capacity
1 600,000.00 600,000.00
Weighing Scale
To measure accurate
weight
- 30 kg
1 16,000.00 16,000.00
Total 616,000.00
5. List of Proposed SSF equipment Brief Justification
1. Steam Distillation Machine A machine used for extracting Citronella oil thru
a Steam Distillation Process.
2. Weighing Scale An equipment used to weigh Dried Citronella
grass prior to boiling and extracting Citronella oil.
6. Rationale/Background:
The QUARBA FARMERS COOPERATIVE, one of the communities/beneficiaries of the
Citronella Agro-enterprise Development (CAD) program.
Witnessed the signing of the Memorandum of Understanding (MOU) for the CAD
Citronella Agro-enterprise Development (CAD) Program, which is a joint effort
from Human Nature, Gawad Kalinga and Kaanib Foundation
Gained access to a three-fold training platform:
o Essential Oil Production Technology
o Values formation and Social Preparation
o Agro-Enterprise Clustering Approach
Was granted by the Department of Agrarian Reform (DAR) 1 Citronella processing
facility (Extractor Machine and a Building).
Currently engaged in Citronella Oil Production and processing.
Aims further to augment the lives of the members and neighbouring farmers.
II. Project Description
7. General Objective:
The whole community will be assisted through an additional machine
that would address to the increasing production of the citronella where
neighboring barangays are now interested to join in their business venture to
be able to come up with an additional income through a farming of a low
maintenance.
Specific Objective:
The members and direct beneficiaries will be able to give emphasis
on citronella farming as a by-product of a diversified farming, giving them
more income with less inputs and maintenance.
Objectives:
8. Organization Management:
Upon infusion of the Shared Service Facility Project, QUARBA Farmers
Cooperative will be headed by its Chairman, supported by its Board of Directors, the
Manager in the person of Enecito N. Macabalo, will do hands-on of the SSF
operations once the machine be installed to its satellite processing area in Sitio
Rocha, Impalutao, Impasugong, Bukidnon, where around 39 members/farmers
tilled their citronella.
Figure 2. QUARBA FARMER’S COOPERATIVE Organizational Chart
Chairman
Board of
Directors
Cashier/
Treasurer
Manager Bookkeeper
Plantation Supervisor Production Officer
Operator
Cluster Leader
Cluster 1 Cluster 2
Shared Service Facility (SSF) Operations
9. Expected Output:
d. Price Competitiveness
Price Before SSF Price After SSF
P1,251.14/Litre P1,205.91/Litre
Product Unit Cost
Before SSF
Product Unit Cost After
SSF
1,137.40/Litre 1,096.28/Litre
e. Increase in Employment
Workers Employed
Before SSF
Workers Employed
After SSF
3 13
Please see production data below
10. QUARBA Citronella Oil Production Cost Schedule with SSF
PARTICULARS
PER UNIT
COST
MONTHLY
VOLUME
AMOUNT
DIRECT MATERIALS REQUIREMENTS:
Fresh Citronella Grass 2.50 12,215 30,537.50
TOTAL MATERIALS: 30,537.50
DIRECT LABOR REQUIERMENTS:
Citronella Extractor Machine Operator : 1 pax 6,000.00
Operator Assistant: 1 pax 5,720.00
Harvesters 4 pax: Ave. Monthly Harvest: 3,000.00/per ha. X 2.792 has. x 2 periods/12
1,396.00
TOTAL DIRECT LABOR: 13,116.00
FACTORY OVERHEAD:
Plantation Supervisor Salary: 1 pax @ 7,000.00 per month 7,000.00
Production Supervisor Salary: 2 pax @ 7,000.00 per pax, per month 14,000.00
Driver' Salary: 1 pax @ 260/day x 22 days 5,720.00
Fuel and Oil(Gasoline): 2Litres/day@51.00 x 22 2,244.00
Electricity Cost (Factory Light Consumption) 400.00
Firewood for Steaming process: 24.43 cubic meter @ 300/cubic meter 7,329.00
TOTAL FACTORY OVERHEAD: 36,693.00
TOTAL PRODUCTION COST: - 80,346.50
COST PER UNIT(Litre) OF CITRONELA OIL: 73.29 Liters Net Output 1,096.28
PRICE PER UNIT(Litre) OF CITRONELA OIL: @ 10% MARK-UP: 1,205.91
Equipment Capacity Utilization:
Equipment/s
Extractor Capacity per
Month @ 350Kg. Per batch
process (Kg.)
Volume per month
(Kg.) (Air Dried 60% of
Fresh Grass)
Capacity Utilization (%)
1 Unit Oil Extractor Machine 8,400 7,329.0 87%
Note: Oil Extraction Process per batch takes 5 hours boiling of citronella grass. Factory will process 2 batches per day or a total of
10 hours shift per day at an average of 12 days processing month.
11. Production Gaps
Lack of an additional facility to address increase in production for another
processing site.
Difficulty in complying the quality standard set by Gandang Kalikasan, Inc. and
other buyers.
III. SSF Project Implementation
12. Production Volume
The Steam Distillation Machine has the capacity of 350 Kilos air dried
citronella leaves which will be brought to boiling point for two hours and cooked for
additional of 5 hrs. to extract the oil. Oil recovery is 1% of the weight of the leaves.
The project will operate at three times (3x) per week for a per month operation.
A. Before SSF
PRODUCT/s
EXISTING
PRODUCTION/ MONTH
(Litre)
DEMAND/Mont
h (Litre)
GAP
(Litre)
Citronella Oil 22.55 95.84 73.29
PRODUCT/s
Projected Production Volume (Litre)
Monthly Year 1 Year 2 Year 3
Citronella Oil
95.84 1,150.13 3,795.42 4,140.46
B. After SSF
Note: Increase in Harvest Volume of Fresh Citronella is Projected to be 10% for the First year and 20% for the succeeding years.
No. of Harvest in the First year is 2; 1st Harvest is 8 months after planting, 2nd is 4 months after the first harvest.
No. of Harvest in the succeeding years will be a four (4) month interval.
13. Plant Population per Hectare: 15,000 tillers
Average Herbage Yield/Ha: 1.75 kgs/tiller
Air Drying of Citronella Grass: 4-5 days
Oil Production: 1% of the total weight of air dried grass
Drying Recovery: 60% of the fresh weight
Gestation Period : 8 months from planting-1st harvest every next 4 months-next harvest (for the period 3-5
years)
Average production of Fresh Grass/Ha: 26,250 kgs
Weight of Air Dried Grass /Ha: 15,750 kgs
Oil Production/ Ha: 157.5 kgs
SRP of Oil /kg: P1,200.00-P1,400.00
Additional assumptions:
Before SSF After SSF
45,108Kg. Fresh Citronella Grass
Annual Harvest or 3,759Kg. Average
Monthly Citronella Grass Harvest
146,580Kg.Fresh Citronella Grass
Annual harvest or 12,215Kg. Average
Monthly Citronella Grass Harvest
Raw Materials Availability ( In Volume)
14. a. Product Price
Market/s
Product/s Price
Citronella Oil P 1,205.91/Litre
Market
Proposed Volume of Orders
per Month (Litre)
A. Existing Market
Human Nature 22.55
Sub Total: 22.55
B. Additional Market (upon the infusion of the SSF
equipment)
Human Nature 36.65
Pharmaceuticals 18.32
SPA's 10.99
Massage Parlor's 7.33
Sub Total: 73.29
Total Market: (A+B): 95.84
b. Market
15. c. Marketing Strategy
Human Nature, the main buyer of the Citronella oil, who is also one of the three
organizations who created the Citronella Agro-Enterprise Development (CAD)
Program, is very keen on its drive and commitment to uplift the lives of the poor
farmers in the Philippines. Having initiated its journey in helping poor farmers in
the areas of Canapa 1 in Bicol Region, they have moved farther and higher to the
mountainous province of Bukidnon.
Possible buyers will be given their chance to support the drive against poverty of
the province of Bukidnon and let them feel being involved by patronizing the
essential oil (citronella) grown and processed in the province.
“Fighting Poverty One Bottle At A Time”, is Human Nature’s (Gandang Kalikasan)
never ending slogan. With this commitment, a sure buyer of the citronella oil is
established.
Sales (in Amount: )
Current With SSF
Monthly Sales of Php 28,218.19 @ Php1,251.14
price per Litre or an Annual Sales of Php 338,618.28
Monthly Sales of Php 115,579.25 @
Php1,205.91price per Litre or an Annual Sales of
Php 1,386,950.95
16. •Proposed Investment Cost (presents the total project cost table)
Financial Aspect
Particulars DTI-SSF Cooperator’s Equity Total Project Cost
Fixed Assets
I. Existing (list of Cooperator’s existing
equipments)
Drying Hall with processing center (extractor
machine) – DAR Grant
520,000.00 520,000.00
Solar Dryer – DAR Grant 150,000.00 150,000.00
Multi Purpose Building – DAR Grant 200,000.00 200,000.00
Farm to Market Road 6,500,000.00 6,500,000.00
Sub-total - 7,370,000.00 7,370,000.00
II. Proposed SSF Equipment
Steam Distillation Machine (600 Kgs Cap) 600,000.00 600,000.00
Weighing scale 30kgs 16,000.00 16,000.00
Sub-total 616,000.00 - 616,000.00
Working Capital
Raw materials 30,537.50 30,537.50
Direct Labor 13,116.00 13,116.00
Overhead 36,693.00 36,693.00
Selling & Admin 19,000.00 19,000.00
Sub-total 99,346.50 99,346.50
Total Project Cost 616,000.00 7,469,346.50 8,085,346.50
17. QUARBA Citronella Oil Production Working Capital Schedule
MATERIAL REQUIREMENTS: AMOUNT
Fresh Citronella Grass 30,537.50
TOTAL MATERIALS: 30,537.50
DIRECT LABOR REQUIERMENTS:
Citronella Extractor Machine Operator 6,000.00
Operator Assistant 5,720.00
Harvesters
1,396.00
TOTAL DIRECT LABOR: 13,116.00
FACTORY OVERHEAD:
Plantation Supervisor Salary 7,000.00
Production Supervisor Salary 14,000.00
Driver' Salary 5,720.00
Fuel and Oil 2,244.00
Electricity Cost 400.00
Firewood for Steaming process 7,329.00
TOTAL FACTORY OVERHEAD: 36,693.00
TOTAL PRODUCTION COST: 80,346.50
SELLING AND ADMINISTRATIVE EXPENSES:
Manager Salary 8,000.00
Cashier Salary 5,000.00
Bookkeeper Salary 6,000.00
TOTAL SELLING AND ADMINISTRATIVE EXPENSES: 19,000.00
TOTAL WORKING CAPITAL: 99,346.50
18. IV. Socio Economic Impact
The project is expected to help increase economic
activity in the locality & increase in the inflow of money in
the area. Standard of living of direct & indirect workers will
also be improved.
