Huwei Farmers' Association Contract-Farms Peanuts at High Prices with Reduced Pesticides and Fertilizers, Processed Products Sell Out So Fast There Aren't Enough to Go Around
Domestic peanuts are in season, yet large quantities of imported blanched peanuts are being shipped into Taiwan. Half of the peanut butter sold on the market is imported, and 90% of the raw material for peanut soup is not domestic peanuts. The Council of Agriculture has imposed tariff quota controls, but the protective effect is limited. Facing cheap imported peanuts grabbing market share, the Huwei Farmers' Association has gone the opposite way, contract-farming high-quality peanuts with farmers at above-market prices, reducing pesticides and fertilizers to raise quality, and relying on a whole-industry-chain approach to connect with major retail channels, making 100 hectares of contract-farmed peanuts sell so well there aren't enough to go around!
Huang Yu-hui, director-general of the Huwei Farmers' Association, said that no matter what the crop is, the first step must be to establish quality. "You have to give consumers a guarantee first, and only then will they trust you. That way you can get farmers to cooperate."
Although the tariff quota avoids the peanut growing season, its protective effect is limited
Yunlin, Changhua and Chiayi and other areas are major domestic peanut-producing regions. The Agriculture and Food Agency forecasts that this year's second crop area will be 12,095 hectares, with output reaching 31,534 metric tons. Peanuts can be grown twice a year, with harvest months in June-July and November-December each year.
The import volume of shelled peanuts and peanut processed products into the country has been increasing year by year. To protect domestic peanuts, the Agriculture and Food Agency explained that since joining the WTO, peanuts have been a tariff quota protected item. Next year's tariff quota import bidding regulations have already been tendered and completed, and the in-quota import period has been adjusted to January-May and August-October to avoid the domestic production season.
Ding Ming-kuei, chairman of the National Peanut Association, said that although the adjusted import control period deliberately avoids the local peanut production season, peanut consumption is actually at its strongest before the Lunar New Year each year (January and February). At that time, large quantities of foreign peanuts are still being imported, and processing plants still choose the lower-priced imported peanuts. He suggested that the release period for imported peanuts should be changed to February through September each year, so that domestic peanuts can truly be protected.
On the other hand, he also pointed out that imported peanut products flood the market. Ninety percent of peanut soup does not use domestic raw materials, and 70% of the peanut butter that Taiwanese people love comes from China and Vietnam. Yet product labeling is unclear and does not clearly state the country of origin of ingredients, making it difficult for consumers to identify products and impossible for them to support local goods. "Ingredient information on products must be fully disclosed, so that consumers have the right to know and to choose, and only then can high-quality domestic peanuts have room to survive."
Regular testing, price-guaranteed contracts: Huwei peanut traceability area increases fourfold
Facing low-priced foreign imported peanuts, how can domestic peanuts increase their value and sales? Huang Yu-hui, who has worked at the Huwei Farmers' Association for 33 years, became director-general 3 years ago. "To sell peanuts, improving quality is essential." Huang Yu-hui pointed out that peanuts produced under past conventional farming methods could not pass pesticide residue and heavy metal tests, nor could they break into major retail channels.
In her first year in office, Huang Yu-hui began price-guaranteed purchasing at above-market prices. "If the market price is 42 yuan per jin, then the farmers' association will buy it at 45 yuan per jin." This got farmers to cooperate with reducing fertilizers and pesticides and move toward traceability certification. "To persuade farmers to change their habits, I kept giving lectures again and again." This raised peanut quality and laid a stable foundation for later entry into retail channels.
At the same time, the contract-farming area was increased from 30 hectares to 80 hectares, reaching 150 hectares this year, and is expected to reach 230 hectares next year. The farmers' association's contract-farming area is as much as 1/4 of Huwei's total peanut production area, giving farmers more confidence to cooperate with the association's transformation. All contract farmers have traceability records. After signing with the farmers' association, the association regularly inspects field production conditions, and all fertilizer and pesticide weights and dates are recorded online. In addition, the partner testing company regularly tests soil and water in the fields.
