Philippine agriculture has the potential to become a major source of Filipinos’ livelihood and a driver of national economic growth.

Universal Leaf Philippines Inc. (ULPI) president Winston Uy shared two key factors for developing local agriculture which he had applied to build up Universal Leaf Philippines Inc. (ULPI), the tobacco business he took over from his father in the mid-1990s.

“I took over a company that was half dead and I’m speaking from an industry that has seen its best days a hundred years ago,” he said at a dinner meeting by Rotary Club of Makati — the first under new RC Makati President Keith Harrison last Tuesday at the Club’s headquarters in Guadalupe Viejo, Makati City.

Uy took over his father’s tobacco business when he was in his mid-30s and has transformed it in a major way. From a domestic tobacco grower with a three percent market share in the 1990s, ULPI is now a major tobacco exporter covering 80 percent of the Philippine market.

Listen actively

Speaking from experience, Uy said to achieve significant growth, leaders in the agricultural sectors must first need to understand the entire supply value chain from the farmers to the consumers. Uy stressed that means listening actively to all stakeholders.

“I came from a generation where children were better seen than heard; I was not allowed to speak out. But now, the opposition to change things is easier,” he said.

A large part of his success in ULPI was his willingness to try new things. For instance, Uy removed the conventional practice of spraying tobacco with water.

“The first innovation I did was to not spray water on the tobacco. Put the water aside. Weigh the tobacco,with water and just weigh the tobacco. There were no calculators then and everybody was cheating the farmers,” he recalled.

Uy added there were also too many middlemen at 90 percent compared to growing contractors’ 10 percent.

Currently, ULPI works with 100,000 farmers in its employ, from 134 farmers in the late 1960s; as of last year, ULPI manages a total of 16,000 hectares of farmland.

“Everybody must be rewarded based on the risk they take and the labor they contribute,” Uy said.

Sharing skills and knowledge

Looking at the entire chain, he added that private business companies and government leaders must actively share their knowledge and skills with farmers so that they can make wiser and better decisions and help the business innovate.

“Some of my staff told me the farmers were too stupid. We have more experience and are more educated and yet we blame the farmers?” Uy said.

“I told my staff that from now on nobody blames those who are less educated. We take the responsibility for them and we find solutions but we hold them accountable; nothing is free,” he continued.

Aside from these, Uy said farming facilities must be proportionately distributed.

“Our government has irrigation only for rice, and we lose 20 percent to 30 percent of the crop because of lack of post-harvest facilities,” he said.

Digitalization

Second, Uy said government agencies and businesses must digitalize their systems using digital databases, remote-sensing technologies, and mobile apps.

He shared that back in the day, when he took over ULPI, he decided to computerize his operations. “We built our own; the Philippines is full of ITI guys. Initially, we failed in the wrong platform because we couldn’t afford to computerize what was then our very small business. But we did not fail in re-reviewing the processes, which is basically the backbone of IT. And hence what happened”

“All these lessons we have done in the past 20 plus years,are now embedded into a digital platform that encompasses all parts of agriculture, from HR to the farm side, to logistics, the factory, warehousing, everything. We are completely digital in our company.”

ULPI uses a centralized computer system at the office and an app for tablets and smartphones used by company staff on the field to check on a whole gamut of things, from the weather to logistical analytics. The technology can also provide crop profiles, profitability projections, and sustainability compliance.

A priority for Uy in the conduct of his business is caring for his people, particularly the farmers who grow tobacco for ULPI. “You should take care of the farmers completely. They say you cannot trust the farmers but bad debts they incur are less than three percent and our profit is P130,000 per hectare for farmers,” Uy said.

Through digital systems, he added the whole process in agriculture can be standardized to achieve predictable results and address risks immediately when they arise.

“That’s why digitalization is very important. Our digital platform is version 25 because of all the enhancements. I presented this to President Ferdinand Marcos Jr. and he said he wanted to visit our facility and see our system,” Uy said.

Food quality, prices

Uy said applying these innovations to local agriculture will ultimately lead to more Filipinos working in farms which can be worked on to yield affordable high-quality food for Filipinos.

He shared that Philippine agriculture has shrunk to less than 15 percent from 45 percent as the country relies heavily on imports and pays substantial tariffs.

“Our food is 35 to 45 percent more expensive because of the tariff, and we wasted 27 years of doing nothing because it was between not so good and not so bad,” Uy said.

“What makes me cry is that we have the shortest height of people and the lowest IQ in the world. This is the product of low-quality and expensive food,” he continued.

Uy’s painstaking hard work, fair practices, and the introduction of innovation and essential digital technology to his business operations have put ULPI at the forefront of tobacco industry transformation. “By empowering our farmers, giving them support has transformed the industry from traditional to globally competitive,” he said.

From 134 farmers planting 70 hectares of tobacco in the late 1990s, ULPI’s systems have expanded the company’s reach to growing 16,000 hectares.

“ULPI today supports 145,000 farmers and workers supported by 8,000 employees using our systems for both Regions 1 and 2,” shared Uy.

The company’s introduction of good agricultural practices, have reduced moisture levels, eliminated non-tobacco related materials and have transitioned into sustainable tobacco production.

“Our processes have added value to tobacco products, creating a competitive tobacco industry by maximizing farmer profitability. UPLI has developed crops with comparable yields to global tobacco sources and is now the biggest broadleaf producer in the world,” says Uy.