Systematic Engineering of Abaca

Fiber Processing for Sustainable Textile

Production
 TABLE OF CONTENTS

TITLE PAGE

TABLE OF CONTENTS

CHAPTER I: INTRODUCTION

1.1. Introduction

1.2. Historical Background

1.3. Mission and Vision of the Company

1.4. Company Name and Location

1.5. Abaca Fiber

1.6. Sustainable Textiles

1.7. AbacaBased Textiles

CHAPTER II: MARKET STUDY

2.1. Product Detail

2.2. Supply and Demand Data of Abaca Fiber

2.3. Projected Data for Supply and Demand of Abaca Fiber

2.4. Excess Supply

2.5. Plant Capacity

2.6. Market Analysis of Sustainable Textiles

2.7. Bioplastics Competition

CHAPTER III: TECHNICAL STUDY

3.1. Raw Materials

3.2. Factors Affecting Plant Location

3.3. Purchased Equipment

3.4. Process Flow and Diagrams

 3.5. Plant Layout

3.6. Material and Energy Balance

CHAPTER IV: FEASIBILITY STUDY

4.1. Direct and Indirect Cost

4.2. Total Production Cost

4.3. Net Profit

4.4. Rate of Return Investment

CHAPTER V: MANAGEMENT STUDY

5.1. Organizational Chart

5.2. Organizational Position and Line of Work

5.3. Job Qualifications

5.4. Company Policies

CHAPTER VI: SOCIOECONOMIC STUDY

6.1. Contribution to Philippine Economy

6.2. Effects of Business in Society

6.3. Effects of Government Taxation

6.4. Contribution to Income and Employment

6.5. Community

6.6. Social Implications

6.7. SWOT Analysis

 INTRODUCTION

The global textile industry is undergoing a significant transformation towards sustainability,

driven by increasing consumer awareness and demand for eco-friendly products. Abaca fiber,
derived from the banana plant, is a renewable resource that offers a sustainable alternative to
synthetic fibers. This study aims to establish a systematic engineering approach for processing
abaca fiber into sustainable textiles, contributing to environmental conservation and economic
growth in Davao.

The envisioned plant design for systematic engineering of abaca fiber processing in Davao aims
to revolutionize textile production through sustainable practices, leveraging the inherent
properties of abaca fiber and addressing the challenges faced by the Philippine abaca industry
(Aragon, 2000). Abaca, also known as *Musa textilis*, is a natural fiber renowned for its
exceptional tensile strength, making it one of the strongest natural fibers available (Anthony et
al., 2020). Its high strength and medium modulus fiber characteristics, with tensile strength
values ranging from 511 to 1051 MPa and Young's modulus varying between 13.5 and 29.8 GPa,
position it as a viable alternative to synthetic fibers in various textile applications (Souza &
d’Almeida, 2014). Abaca fiber's composition, comprising approximately 63% cellulose, 21%
hemicellulose, and 14% lignin, contributes to its desirable mechanical and chemical properties,
rendering it suitable for textile and paper production (Bazliah et al., 2021). The plant's design
will incorporate advanced techniques for fiber extraction, cleaning, and treatment, ensuring the
production of high-quality abaca fibers for textile manufacturing.
The plant design will prioritize environmentally conscious processes, minimizing waste
generation and promoting resource efficiency throughout the abaca fiber processing chain. The
utilization of abaca fiber aligns with global sustainability initiatives, as it is a biodegradable and
renewable resource that requires minimal chemical inputs during cultivation compared to
synthetic fibers (Elanchezhian et al., 2018).

Abaca is internationally known as Manila hemp, belongs to the musaceae family and is a
relative of the fruitbearing banana plant that grew only in the Philippine Islands. It has been used
as material for making fabric and rope in various regions. The Philippines dominates the global
Abaca trade as the country supplies about 87.5% of the world’s Abaca fiber requirements and
Ecuador and Costa Rica the remaining 12.5% as of 2016. In 2016, Abaca was planted on
180,302 hectares (ha) with production reaching 72,000 metric tons (MT).

The Abaca fiber market in the Philippines plays a significant role in the nation's economy
as the country is the world's leading producer of this valuable material. Over half of the total
global supply of abaca comes from the Philippines. Exports of abaca fiber and manufacture
generated an average of US$97.1 million per year in the last ten years. Some US$84.9 million
came from abaca manufactures such as pulp, cordage, yarns, fabrics and fiber crafts. The
remaining US$12.2 million was from raw fiber exports. Europe, specifically, the United
Kingdom, is the premier destination of abaca fiber followed by Asia,with Japan as the leading
buyer. All abaca pulp was exported for specialty paper manufacturers.

The industry provides employment opportunities for thousands, predominantly in rural

areas where the plant is cultivated and processed. The demand for abaca fiber, both locally and
internationally, remains high due to its unique quality and varied applications in industries like
papermaking, handicraft, and furniture. The government's supportive policies to sustainably
develop and market abaca products globally underpin the stability of this sector.

The abaca farm structure is classified as a small farm which is owned and managed by
individual farmers. It has an average area of 1.6 hectares for every farmer. There are only a few
farms established and managed by cooperatives or associations with areas ranging from 10 to
100 hectares. Almost one third of the abaca areas can be found in Region V or the Bicol Region
with 52,493 hectares. The land area is comparable to combined abaca areas of Regions XIII, XI,
XII and VI. Most of the abaca areas in Bicol are heavily concentrated in Catanduanes,
comprising more than 60 percent of the total area of the region. At present, Catanduanes is the
biggest abaca producing province contributing 35 percent of the total production, followed by
Davao Oriental with about 8.5 percent. Due to frequent typhoons in Bicol and Leyte, there are
moves by some abaca factories and investors to look for alternative areas to plant Abaca.

1.2. HISTORICAL BACKGROUND

Abaca, known as Manila hemp, has been cultivated in the Philippines for centuries. It is
renowned for its strength, durability, and biodegradability. The establishment of an abaca fiber
processing plant in Davao will not only enhance the local economy but also promote sustainable
practices in the textile industry.

1.3. MISSION AND VISION OF THE COMPANY

1.3.1. MISSION

To revolutionize the textile industry by producing high-quality, sustainable textiles from abaca
fiber, while promoting environmental stewardship and supporting local communities.

1.3.2. VISION

To be a leading provider of sustainable textile solutions in the Philippines, recognized for our
commitment to innovation, quality, and social responsibility.
1.4. COMPANY NAME AND LOCATION

Company Name: Abaca Innovations, Inc.

Location: Davao City, Philippines, strategically positioned near abaca plantations to ensure a
steady supply of raw materials.

1.5. ABACA FIBER

Abaca fiber is extracted from the leaf stalks of the abaca plant. It is known for its exceptional
tensile strength and resistance to saltwater, making it ideal for various textile applications. The
Philippines is the largest producer of abaca, contributing significantly to the global market.

1.6. SUSTAINABLE TEXTILES

Sustainable textiles are produced using eco-friendly materials and processes that minimize
environmental impact. The use of abaca fiber aligns with the principles of sustainability, as it is
biodegradable and sourced from renewable resources.

1.7. ABACA-BASED TEXTILES

Abaca-based textiles can be used in various applications, including fashion, home furnishings,
and industrial products. The versatility of abaca fiber allows for the creation of unique and
innovative textile products that cater to the growing demand for sustainable options.
 CHAPTER II: MARKET STUDY

2.1. PRODUCT DETAIL

- Product Type: Abaca-based textiles, including fabrics, bags, and home decor items.

- Features: Biodegradable, durable, and eco-friendly.

2.2. SUPPLY AND DEMAND DATA OF ABACA FIBER

- Supply Data: The Philippines produces approximately 70,000 metric tons of abaca fiber
annually.

- Demand Data: The global demand for sustainable textiles is projected to grow by 10%
annually.

I. PROJECTION OF SUPPLY OF ABACA FIBER IN THE PHILIPPINES

Plantations of Abaca are an important component of agriculture in the Philippines and an

integral socioeconomic development engine. From 85. 5% of the total global market supply, the
industry accounted for the largest source of Abaca in the world, supporting thousands of people
in plantationrich parts of Bicol, Central Luzon, and Calabarzon. Abaca’s use, such as in fishing
nets, ropes, and specialist paperbased products (e. g. currency paper, tea bags) due to its
durability and ability to resist salt water, is growing in importance with the advances of textile
fabrics, building materials, and ecofriendly packaging.

Producing Abaca is a blend of economic development and environmental management.

Building plantations in 21 new regions (such as Bukidnon and Davao Occidental) is the main
focus of the Philippine Abaca Industry Roadmap (2021–2025) in order to maximize
sustainability and reduce the dependence of traditional breeding centers. Precision agriculture
and investments in innovative planting materials, with a focus on conservation of farmland, and
pest / disease resistant cultivation practices, help improve agriculture yield and quality while
supporting environmental sustainable practices. Valueadded products (such as blended textiles
and biodegradable plastics) satisfying the global demand for sustainable resources have
established abaca as one of the major players in environmentallyconscious industries.

Though the sector has its benefits, it faces challenges in terms of climate vulnerability (for
example flooding and pests), and low productivity as a consequence of outdated practices. In
response to some of these issues, the government has developed technologydemo farms and seed
banks to promote Good Agricultural Practices (GAP), in order to facilitate resource viability in
the long term. In addition, various government initiatives like the funding of youth engagement
initiatives and infrastructure projects, are examples of the initiatives dedicated to sustainably
utilizing the potential of Abaca.

Supply of Abaca Fiber in the Philippines from year 2019 to 2030

Projected Year HISTORICAL DATA PROJECTED DATA

(Supply in Metric Tons) (Supply in Metric Tons)

2019 69,829 MT

2020 82,170 MT

2021 311.80 MT

2022 63,640.61 MT / 75,349 MT

2023 17,640 (April to June only /

77,189 MT)

2024 195,000 MT (Projected

Demand no Production Data
Disclosed)

2025 61,100 MT

2026 65,890 MT

2027 71,056 MT

2028 76,627 MT

2029 82,634 MT

2030 89,113 MT

Abaca fiber production projections for textiles in the Philippines from 2025 to 2030 can be
calculated using recent data and growth trends. Based on a 7.84% compound annual growth rate
(CAGR) derived from market analysis and historical patterns, here are the projected figures:
II. PROJECTION OF DEMAND OF ABACA FIBER IN THE PHILIPPINES

In textiles, abaca fiber demand persisted in steady growth between 2019 and 2024 due to
global sustainability trends and the increased emphasis on natural and sustainable materials.
Abaca, the world’s largest supplier of abaca fiber, was seen as an option for traditional textiles
that was increasingly being used for fashion, upholstery, and industrial applications, leveraging
its durability, biodegradability, and saltwater resistance. New materials including abacablended
fabrics (in this case blends with cotton and synthetic fibers) also emerged in line with these
global demand trends.

Projected HISTORICAL PROJECTED DATA (Demand/Sales

Year DATA(Demand/Sales USD) USD)

Production Textile Textile Production Textile Textile Sales

(Metric Demand Sales (USD (Metric Demand (USD Million)
Tons) (Metric Million) Tons) (Metric
Tons) Tons)

2019
68,000 6,800 10.4

2020
66,500 6,650 10.1

2021
67,200 7,400 11.3

2022
63,640 7,000 10.7

2023
61,100 7,330 11.2

2024
64,800 7,776 12.4

2025
65,890 8,540 13.0

2026
71,056 9,240 14.1

2027
76,627 10,100 15.4
 2028
82,634 11,200 17.1

2029
89,113 12,400 18.9

2030
96,113 13,800 21.0

Demand grew sharply as industries sought a sustainable alternative to synthetic fibers, and
abaca’s relatively long fiber length and versatility made it ideal for marine textiles, outdoor gear,
and luxury fashion. Among the main importers, Europe and North America were responsible for
larger volumes, while Asia Pacific led production and innovation. In the Philippines, the NCR
dominated processing and rs of plantations and supply chains, although climate disruptions and
low production output led to a limited supply chain for textile manufacturers.

As demand and production per capita continues to increase, however, competition from
synthetic fibers and supply gaps remain. The Philippine Abaca Industry Roadmap (2021–2025)
lauded the need to modernize agricultural practices as well as diversify applications, such as
biodegradable fabrics and reinforced composites, to sustain demand for the product. The
Roadmap also provided assistance in furthering innovations in textile processing and
governmentbacked efforts (such as Catanduanes Provincial Commodity Investment Plan) toward
closing supply gaps. This sector's potential role as a glass fiber substitute in automobile
components underscores its importance to diversifying applications.

Demand of Abaca Fiber in the Philippines from Year 2019 to 2024 logistics

Abaca fiber production and demand for textiles in the Philippines have shown fluctuating trends,
influenced by market shifts and sustainability initiatives. Below is a synthesized analysis
combining historical data (2019–2024) and projections (2025–2030), focusing on the textile
sector.

Total production data reflects reported declines (e.g., 5.7% in 2022 due to floods) and recovery
efforts.
Textile demand is estimated at ~11–12% of total production, based on market segmentation
trends.
Sales value assumes an average price of $1,524/MT (derived from 2023’s $97.01M market value
for 63,640.61MT
INSERT THE ARITHMETIC FORMULATION

The systematic engineering of abaca fiber processing for sustainable textile production in Davao
from 2019 to 2030 involves analyzing supply-demand dynamics, plant scalability, market trends,
and competitive positioning. Below is a structured study synthesizing regional data and global
trends:

2.4. Excess Supply (2019–2030)

 Historical Data (2019–2025):

 2019: Excess supply = 70,000 MT (production) - 65,000 MT (demand) = 5,000

MT.

 2025: Projected excess = 80,000 MT (supply) - 73,000 MT (demand) = 7,000

MT.

 Fluctuations: Weather disruptions (e.g., 2022 deficit of -4,360 MT due to El

Niño).

 2030 Projections:

 Assuming a 3.74% CAGR in abaca fiber production, supply could reach ~95,000
MT by 2030.

 Demand growth (aligned with sustainable textile CAGR of 9.1%) may reach
~110,000 MT, potentially creating a shortfall unless production scales with
PhilFida’s roadmap.

2.5. Plant Capacity

 Current Capacity: 10,000 MT/year, sufficient to process annual excess supply (e.g.,
7,000 MT in 2025).

 Scalability Needs:

 2022 Deficit: Highlights dependency on stable supply; diversification into

blended textiles (e.g., abaca-cotton) could mitigate risks.

 Post-2025: If production aligns with PhilFida’s 2022 target (221,238 MT),

capacity expansion or secondary product lines (e.g., bioplastics) will be critical.
2.6. Market Analysis of Sustainable Textiles

Global Trends (2019–2030):

 Market Growth: Sustainable fashion to expand from $6.35B (2019) to $15.17B (2030),
driven by 66% of consumers prioritizing sustainability.

 Regional Opportunities:

 Davao’s Initiatives: Peace 911 program boosting abaca cultivation in Paquibato

District.

 Export Potential: Philippines dominates 87% of global abaca supply, with the
EU and Japan as key importers.

Demand Drivers:

 Luxury & Technical Textiles: Abaca’s tensile strength (~1 GPa) suits high-value
applications like automotive composites.

 Circular Economy: Brands like Bananatex developing biodegradable jerseys, aligning

with Davao’s eco-friendly production.

2.7. Bioplastics Competition

Competitive Landscape in Sustainable Textiles:

Material Strengths Weaknesses Market Presence

(2025)

Biodegradable, high Limited regional Emerging (niche

Abaca Fiber tensile strength scalability textiles)

Wide consumer
Organic Cotton acceptance High water usage Dominant (apparel)

Cost-effective, Relies on plastic

Recycled Polyester mainstream adoption waste High (fast fashion)

Local to Davao, Smaller production Regional (e.g.,

Banana Fiber similar properties scale BAFWELA)

Strategic Recommendations:

 Differentiation: Market abaca’s durability for technical textiles (e.g., geotextiles).

  Partnerships: Collaborate with brands like Stella McCartney to leverage luxury
sustainable trends.

Synthesis

Davao’s abaca industry is positioned to capitalize on global sustainable demand, contingent on

overcoming production volatility and scaling processing capacity. Aligning with PhilFida’s
roadmap and diversifying into high-value applications will be pivotal to converting excess
supply into market leadership by 2030.
 Chapter III : TECHNICAL STUDY

3.1. Raw Materials

 Abaca Fiber:

 Source: Davao Oriental’s plantations are the primary source, with farmers
cultivating 2.02 ha on average, yielding 440.51 kg/ha/year.

 Challenges: Low fiber recovery rate (1.5% in 2019) generates 9,850 MT

waste per 10,000 MT processed. This waste can be redirected into biocomposites
or biogas production.

 Quality Control: Implementing quality checks at the farm level to ensure

consistent fiber quality.

 Additives:

 Azo-free dyes (e.g., Hacienda Crafts’ eco-friendly dyes) ensure non-toxic textile
finishing.

 Eco-friendly Finishing Agents: Using natural oils and plant-based chemicals for
softening and waterproofing.

3.2. Factors Affecting Plant Location

Factor Details

80% of Davao Oriental’s abaca farms are

within 2.49 km of access roads, reducing
Proximity to Farms transport costs

Near Davao City’s trading hubs (e.g., 39 fiber

Market Access traders in 2019).

Peace 911 program boosts farmer training;

FPRDI’s PHP 165,000 fiber extractor improves
Labor & Infrastructure safety.

Close to water sources for processing but with

Environmental Considerations adequate wastewater treatment facilities.
3.3. Purchased Equipment

 Fiber Extraction:

 FPRDI’s mechanized stripper (adopted post-2022) eliminates blade hazards and

increases yield by 15–20%.

 Decorticators: For efficient removal of non-fibrous materials.

 Spinning/Weaving:

 Semi-automatic spindles for sinamay fabric production, reducing manual labor.

 Jacquard Looms: For intricate designs and patterns in high-value textiles.

3.4. Process Flow and Diagrams

Production Stages:

1. Raw Abaca → Tuxying (separating leaf sheaths).

2. Stripping → Washing (removes parenchyma cells).

3. Drying → Spinning (into yarns) → Weaving (sinamay fabric).

4. Finishing (dyeing with Azo-free agents) → Packaging.

INSERT PIC/FLOW PROCESS

Energy Flow Diagram:

 2019 Baseline: 50,000,000 kWh/year for 10,000 MT processing.

 2030 Target: Solar integration reduces grid dependence by 30%.

 Biogas Generation: Utilizing waste biomass for energy production.

3.5. Plant Layout

 Zoning:

 Raw Material Reception (adjacent to waste recycling).

 Processing Line (linear flow from extraction to weaving).

 Eco-Dyeing Unit (separate ventilation for chemical safety).

 Waste Management:
  9,850 MT/year biomass waste redirected to biogas or biocomposite
production.

 Water Treatment: On-site facilities for wastewater recycling.

INSERT PIC/FLOW PROCESS

PER MACHINE

3.6. Material and Energy Balance

Material Balance (2019–2030):

Parameter 2019 Value 2030 Target

Raw Fiber Input 10,000 MT 15,000 MT

Fiber Recovery Rate 1.5% (150 MT) 3.0% (450 MT)

Waste Utilization 5% (492.5 MT) 85% (8,372.5 MT)

Energy Balance:

 2019: 50,000,000 kWh/year (100% grid).

 2030: 35,000,000 kWh/year (30% solar, 20% biogas from waste).

 Energy Efficiency Measures: Implementing LED lighting and optimizing machinery to

reduce energy consumption.

Strategic Recommendations

 Adopt FPRDI’s Stripping Technology: Improve yield and worker safety.

 Partner with Hacienda Crafts: For Azo-free dyeing protocols.

 Invest in Waste-to-Energy Systems: Achieve circular production by 2030.

 Expand Market Outreach: Engage with eco-friendly fashion brands to increase demand
for sustainable textiles.
Implementation Timeline (2019–2030)

Year Milestone Expected Impact

Baseline assessment of Identify areas for

2019 current production processes. improvement.

Adoption of FPRDI’s
2020 mechanized stripper. Increase fiber yield by 15%.

Integration of solar energy Reduce grid dependence by

2022 into the production process. 10%.

Scale-up of biogas production Achieve 20% energy self-

2025 from waste biomass. sufficiency.

Full implementation of
circular economy practices
and expanded market Establish Davao as a leader in
2030 outreach. sustainable textiles.

Financial Projections

 Initial Investment (2019): PHP 500 million (equipment and infrastructure).

 Annual Revenue (2025): PHP 1.5 billion (based on 10,000 MT processed).

 Projected Growth Rate: 10% annually, driven by increased demand for sustainable
textiles.
 CHAPTER IV: FEASIBILITY STUDY

4.1. Direct and Indirect Costs

 Direct Costs:

 Raw Materials: Abaca fibers sourced from local plantations at PHP 15/kg (based
on North Cotabato prices).

 Labor: PHP 500/day per worker for manual processing; reduced with
mechanization.

 Equipment: Initial investment in mechanized stripping machines, dryers, and

spinning/weaving equipment (e.g., PHP 690,000 for basic setup).

 Indirect Costs:

 Overhead: Rent for processing facility, administrative costs.

 Utilities: Electricity for machinery operation, water for processing.

 Maintenance: Regular upkeep of equipment to ensure efficiency.

4.2. Total Production Cost

 Fixed Costs:

 Equipment Depreciation: PHP 100,000/year (assuming a 7-year lifespan).

 Rent and Utilities: PHP 200,000/year (estimated).

 Variable Costs:

 Raw Materials: PHP 150,000/month (for 10,000 kg/month at PHP 15/kg).

 Labor: PHP 75,000/month (for 5 workers at PHP 15,000/month).

 Total Production Cost:

Total Cost=Fixed Costs + Variable Costs

= (PHP 300,000/year) + (PHP 225,000/month) × 12=PHP 3,000,000/year

4.3. Net Profit

 Projected Revenue:
  Market Price: PHP 90/kg for high-quality abaca fiber (based on North Cotabato
market).

 Annual Production: 10,000 MT/year.

 Revenue: PHP 900,000,000/year.

 Net Profit:

Net Profit=Projected Revenue−Total Production Cost=

= PHP 900,000,000 − PHP 3,000,000 = PHP 897,000,000/year

4.4. Rate of Return on Investment (ROI)

 Initial Investment: PHP 1,279,000 (including equipment and initial operational costs).

 Annual Net Profit: PHP 897,000,000.

 ROI Calculation:

ROI= ( TotalNetInvestment
profit
) x 100=( PHP
PHP 1,279,000 )
897,000,000
x 100=701 %

Market Analysis and Trends

The global abaca fiber market is experiencing significant growth due to increasing demand for
sustainable materials. Key trends include:

 Sustainability and Environmental Concerns: Growing awareness of environmental issues

drives demand for natural fibers like abaca, which is biodegradable and less resource-
intensive.

 Technological Advancements: Improvements in processing techniques enhance

efficiency and product quality, expanding applications in industries such as automotive
and construction.

 Government Support: Policies and incentives in countries like the Philippines support
abaca cultivation and processing, ensuring a stable supply of high-quality fibers.

Strategic Recommendations

 Mechanization: Implement mechanized stripping and drying systems to improve fiber

quality and reduce labor costs.

 Market Diversification: Expand product lines to include high-value textiles and

biocomposites.
  Collaboration: Engage with local farmers and government agencies to ensure stable raw
material supply and support for innovation.

 Financial Planning: Conduct detailed financial analyses to account for potential risks and
market fluctuations.

Implementation Timeline (2019–2030)

Year Milestone Expected Impact

Baseline assessment of current

2019 production processes. Identify areas for improvement.

Adoption of FPRDI’s
2020 mechanized stripper. Increase fiber yield by 15%.

Integration of solar energy into Reduce grid dependence by

2022 the production process. 10%.

Scale-up of biogas production Achieve 20% energy self-

2025 from waste biomass. sufficiency.

Full implementation of circular

economy practices and Establish Davao as a leader in
2030 expanded market outreach. sustainable textiles.

Financial Projections

 Initial Investment (2019): PHP 500 million (equipment and infrastructure).

 Annual Revenue (2025): PHP 1.5 billion (based on 10,000 MT processed).

 Projected Growth Rate: 10% annually, driven by increased demand for sustainable
textiles.

Market Opportunities and Challenges

 Opportunities:

 Growing Demand for Sustainable Materials: Abaca fiber’s biodegradability and

strength make it a preferred choice in industries like automotive and construction.

 Technological Advancements: Improvements in processing techniques can

enhance product quality and expand applications.
  Challenges:

 Raw Material Fluctuations: Climate and agricultural dependencies can affect

supply stability.

 High Production Costs: Compared to synthetic fibers, abaca production costs are
higher, limiting competitiveness in cost-sensitive markets.

Environmental Impact Assessment

 Carbon Footprint: Abaca production is generally low in carbon emissions compared to

synthetic fibers, but mechanization and energy use can increase this footprint.

 Water Usage: Efficient water management is crucial to minimize environmental impact.

 Waste Management: Implementing biogas production from waste biomass reduces waste
disposal issues and generates additional energy.

Social Impact Assessment

 Employment Opportunities: Mechanization may reduce labor needs in some areas but
creates skilled jobs in maintenance and operation.

 Community Engagement: Collaborating with local farmers supports rural economies and
promotes sustainable agriculture practices.

 Education and Training: Providing training programs for workers enhances skills and
adaptability to new technologies.

Regulatory Framework

 Local Regulations: Compliance with environmental and labor laws in the Philippines.

 International Standards: Adherence to global sustainability standards (e.g., ISO 14001 for
environmental management) enhances market credibility.
 CHAPTER V: MANAGEMENT STUDY

5.1. Organizational Chart

The organizational structure of the abaca fiber processing company in Davao will be as
follows:

Position Responsibilities

Overall strategic direction and management

CEO/Managing Director oversight.

Supervises production processes and equipment

Operations Manager maintenance.

Ensures product quality and compliance with

Quality Control Manager standards.

Marketing Manager Develops and implements marketing strategies.

Handles recruitment, training, and employee

HR Manager relations.

Coordinates with local farmers for raw material

Farm Liaison Officer supply.

Oversees research and development of new

R&D Manager products and processes.

5.2. Organizational Position and Line of Work

 CEO/Managing Director: Oversees all operations, sets strategic goals, and ensures
alignment with PhilFIDA’s roadmap for the abaca industry.

 Operations Manager: Responsible for day-to-day production activities, including

equipment maintenance and supply chain management.

 Quality Control Manager: Conducts regular quality checks on raw materials and
finished products to meet international standards.
  Marketing Manager: Develops marketing strategies to increase market share and
expand product lines.

 HR Manager: Manages employee training, recruitment, and benefits to ensure a skilled

and motivated workforce.

 Farm Liaison Officer: Coordinates with local farmers to ensure a stable supply of high-
quality abaca fibers.

 R&D Manager: Identifies opportunities for innovation in processing techniques and

product development.

5.3. Job Qualifications

 CEO/Managing Director: MBA or equivalent, with experience in textile industry

management.

 Operations Manager: Bachelor’s degree in Engineering or Operations Management,

with at least 5 years of experience.

 Quality Control Manager: Bachelor’s degree in Textile Science or Quality

Management, with 3+ years of experience.

 Marketing Manager: Bachelor’s degree in Marketing or Business, with 3+ years of

experience in the textile industry.

 HR Manager: Bachelor’s degree in HR Management or Psychology, with 2+ years of

experience.

 Farm Liaison Officer: Bachelor’s degree in Agriculture or Business, with experience in

supply chain management.

 R&D Manager: Master’s degree in Textile Technology or Materials Science, with

experience in innovation and product development.

5.4. Company Policies

 Working Hours: Standard 8-hour workday, Monday to Friday, with flexible hours for
production shifts.

 Leave Policies: Annual leave of 15 days, sick leave of 10 days, and parental leave as per
Philippine labor laws.

 Employee Benefits: Comprehensive health insurance, retirement plan, and performance-

based bonuses.
  Environmental Policy: Commitment to sustainable practices, including energy-efficient
operations and waste reduction.

 Quality Policy: Adherence to international quality standards for all products.

Strategic Recommendations

 Collaboration with PhilFIDA: Align operations with the Philippine Abaca Industry
Roadmap to leverage support and resources.

 Training Programs: Regular training for employees to enhance skills in sustainable

textile production and quality control.

 Market Expansion: Engage with international buyers to increase export opportunities,

particularly in the sustainable textiles market.

 Innovation in Processing: Invest in R&D to improve efficiency and expand product

lines.

Implementation Timeline (2019–2030)

Year Milestone Expected Impact

Establish organizational
2019 structure and key positions. Efficient management setup.

Implement quality control

measures and training
2020 programs. Improved product quality.

Expand marketing efforts to

2022 increase market share. Increased revenue.

Integrate renewable energy Reduced environmental

2025 sources into operations. impact.

Achieve full compliance with

international sustainability Enhanced global market
2030 standards. credibility.

Market Opportunities and Challenges

 Opportunities:
  Growing Demand for Sustainable Materials: Abaca fiber’s biodegradability
and strength make it a preferred choice in industries like automotive and
construction.

 Technological Advancements: Improvements in processing techniques can

enhance product quality and expand applications.

 Challenges:

 Raw Material Fluctuations: Climate and agricultural dependencies can affect

supply stability.

 High Production Costs: Compared to synthetic fibers, abaca production costs are
higher, limiting competitiveness in cost-sensitive markets.

Environmental Impact Assessment

 Carbon Footprint: Abaca production is generally low in carbon emissions compared to

synthetic fibers, but mechanization and energy use can increase this footprint.

 Water Usage: Efficient water management is crucial to minimize environmental impact.

 Waste Management: Implementing biogas production from waste biomass reduces

waste disposal issues and generates additional energy.

Social Impact Assessment

 Employment Opportunities: Mechanization may reduce labor needs in some areas but
creates skilled jobs in maintenance and operation.

 Community Engagement: Collaborating with local farmers supports rural economies

and promotes sustainable agriculture practices.

 Education and Training: Providing training programs for workers enhances skills and
adaptability to new technologies.

Regulatory Framework

 Local Regulations: Compliance with environmental and labor laws in the Philippines.

 International Standards: Adherence to global sustainability standards (e.g., ISO 14001

for environmental management) enhances market credibility.
 CHAPTER VI: SOCIO-ECONOMIC STUDY

6.1. Contribution to Philippine Economy

 Employment Generation: The abaca industry supports about 1.5 million Filipinos
directly and indirectly, contributing significantly to rural employment. In Davao Oriental,
the industry generates an annual income close to PHP 300 million.

 Foreign Exchange Earnings: Abaca exports have generated an average of US$119

million annually over the past decade, with US$100.4 million from abaca manufactures.

 Local Economic Impact: In Davao Oriental, the abaca industry benefits local traders and
farmers, with opportunities for expansion through investment in processing facilities.

6.2. Effects of Business in Society

 Job Creation: Mechanization and expansion of abaca processing will create skilled jobs
in maintenance and operation, while supporting existing labor-intensive roles in farming
and manual processing.

 Community Development: By engaging with local farmers and promoting sustainable

agriculture practices, the business contributes to rural community development and
poverty reduction.

 Cultural Preservation: Supporting local weaving traditions and promoting abaca-based

products helps preserve cultural heritage and traditional crafts.

6.3. Effects of Government Taxation

 Tax Contributions: The abaca processing plant will contribute to local and national
government revenues through taxes on income, employment, and exports.

 Incentives: Potential tax incentives for sustainable industries could further support
business growth and investment in Davao.

6.4. Contribution to Income and Employment

 Job Creation: The expansion of abaca processing facilities and related industries (e.g.,
textiles, bioplastics) can create hundreds of jobs in Davao, both directly and indirectly.

 Income Generation: By increasing the value-added products from abaca, local

communities can benefit from higher incomes through better market prices for their
products.
6.5. Community

 Engagement with Local Farmers: Collaborating with farmers to improve agricultural

practices and ensure a stable supply of high-quality abaca fibers supports rural economies
and promotes sustainable agriculture.

 Support for Local Farmers: Providing training and resources to farmers helps them
adapt to changing market demands and improve their livelihoods.

6.6. Social Implications

 Sustainable Practices: Promoting sustainable textile production contributes to

environmental conservation and reduces the industry's carbon footprint, aligning with
global trends towards eco-friendly products.

 Rural Development: By enhancing economic opportunities in rural areas, the abaca

industry helps reduce poverty and improve social stability.

6.7. SWOT Analysis

SWOT Description

Strong demand for sustainable materials,

existing infrastructure in Davao, and
Strengths government support for the abaca industry.

High production costs compared to synthetic

fibers, dependency on climate conditions for raw
Weaknesses material supply.

Growing global demand for eco-friendly

textiles, potential for technological innovation in
Opportunities processing techniques.

Competition from other sustainable materials

(e.g., organic cotton), fluctuations in global
Threats market prices for abaca products

Strategic Recommendations

 Collaboration with Government Agencies: Work closely with PhilFIDA and DA to

leverage support for improving agricultural productivity and expanding abaca
plantations3.
  Innovation and Technology: Invest in R&D to enhance processing efficiency and
develop new products, expanding market opportunities4.

 Community Engagement: Foster strong relationships with local farmers and

communities to ensure sustainable practices and social benefits2.

Implementation Timeline (2019–2030)

Year Milestone Expected Impact

Establish partnerships with

local farmers and government Improved supply chain
2019 agencies. stability.

Implement mechanized
processing systems to enhance
2020 efficiency. Increased production capacity.

Expand product lines to

include high-value textiles and
2022 biocomposites. Diversified revenue streams.

Achieve full integration of

sustainable practices in all Enhanced environmental
2025 operations. credibility.

Establish Davao as a leading

hub for sustainable textile Increased global market
2030 production. presence

Market Opportunities and Challenges

 Opportunities:

 Growing Demand for Sustainable Materials: Abaca fiber’s biodegradability

and strength make it a preferred choice in industries like automotive and
construction4.

 Technological Advancements: Improvements in processing techniques can

enhance product quality and expand applications5.

 Challenges:
  Raw Material Fluctuations: Climate and agricultural dependencies can affect
supply stability4.

 High Production Costs: Compared to synthetic fibers, abaca production costs are
higher, limiting competitiveness in cost-sensitive markets5.

Environmental Impact Assessment

 Carbon Footprint: Abaca production is generally low in carbon emissions compared to

synthetic fibers, but mechanization and energy use can increase this footprint.

 Water Usage: Efficient water management is crucial to minimize environmental impact.

 Waste Management: Implementing biogas production from waste biomass reduces

waste disposal issues and generates additional energy.

Social Impact Assessment

 Employment Opportunities: Mechanization may reduce labor needs in some areas but
creates skilled jobs in maintenance and operation.

 Community Engagement: Collaborating with local farmers supports rural economies

and promotes sustainable agriculture practices.

 Education and Training: Providing training programs for workers enhances skills and
adaptability to new technologies.

Regulatory Framework

 Local Regulations: Compliance with environmental and labor laws in the Philippines.

 International Standards: Adherence to global sustainability standards (e.g., ISO 14001

for environmental management) enhances market credibility.

Conclusion

The socio-economic study highlights the significant contributions of the abaca fiber processing
industry to the Philippine economy, particularly in terms of employment, foreign exchange
earnings, and rural development. By leveraging government support, technological innovation,
and community engagement, the industry can further enhance its socio-economic impact while
promoting sustainable practices.

Future Directions

 Innovation in Processing Technologies: Continuous improvement in machinery

efficiency and product quality to meet global demand for sustainable textiles.
 Market Expansion: Targeting new industries and geographic regions for abaca-based
products to increase market share.

 Sustainability Certifications: Obtaining certifications like GOTS (Global Organic

Textile Standard) to enhance market appeal and credibility.
REFERENCES