Changing The Landscape For Corn Farmers

The stories of struggle, risk, and worries of over 122 corn farmers across the country sounded all too familiar as the Company engaged them in consultation meetings. The meetings were meant to introduce them to a new way of doing business — a direct corn-buying program of SMFI that would bypass their usual channels.

As corn is one of the key ingredients of animal feeds, and with the continuing expansion of the Company’s feed mills, the direct buying program is as essential to the Company’s feeds business as it could be for the farmers themselves. With global feed commodity prices reaching unprecedented highs in 2022, local corn supply became more critical than ever, but a stalled economy at the end of the pandemic did not provide farmers enough capital to expand their output.

The program required a lot of pre-work, with the procurement and agribusiness development groups conducting interviews and profiling studies to determine the various parameters in corn farming. Eventually, partnerships with farmers were established and the program took off.

The program yielded better margins both for the farmers and the Company. As payment for the harvest is deposited directly to farmers’ bank accounts within 2-3 days of delivery, farmers are able to immediately recover their costs and have cash available for other expenses.

During the first year, San Miguel Foods purchased over 35,000 MT of corn. As the program continues to expand, so do stories of corn farmers bouncing back from huge debts incurred during the pandemic. Today, farmers involved in the program are more liquid and better prepared for any crisis. Some were even able to purchase their own delivery trucks and more equipment. With the improvement in their quality of life, these farmers have encouraged their families and other farmers to join the program and enjoy its benefits.

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