14. Wonderland Agristock limited

 

For those who came in late…..

 This story is about a project to use modern animal husbandry approaches to grow pigs efficiently in the Highlands of Papua New Guinea. The back ground is provided in blog chapters 1-13. This chapter (14) describes the next stage from an experiment near Port Moresby to implementation in Hela province.

After we wound up the proof-of-concept part of the program, it took a while to get to the next stage.  The plan had always been to base a commercial project in Hela Province and launch a business that would provide jobs for the local people and be profitable.  At some point we had to take the program to the Hela.  It could never achieve its objectives if it remained in Port Moresby. 

Our modelling indicated that the program could be profitable.  Even better it would contribute of the order of PGK 5000 (~AUD 1,800) per household for the supply of kau kau (sweet potato), caring for the pigs and a maintenance fee for the pig house. Village households have an average annual income of about 12,600 PGK (~AUD 4,600) so the pigs added a handsome income for roughly half an hour work each day, plus the work in the kau kau garden.   

Business For Development (B4D) and Oil Search recruited landowner companies (lancos) interested in investing in the program. They included Trans Wonderland Limited (TWL), Gigira Development Corporation (GDC), PNG Mining and Hospitality Services (PNGMHS), Mananda Umbrella Joint Venture (MUJV) and Hides Gas Development Company (HDGC). Together they elected to adopt the idea of a stockfeed and pork production enterprise in the Highlands and called the enterprise Wonderland Agristock Limited (WAL). Each lanco has a unique background and vested interest in building economic opportunities in the Province:

By co-investing in the program and establishing WAL, the lancos demonstrated their desire to diversify their investments in the region and drive sustainable development outcomes that support the wider community – namely smallholder farmers.  

Once the idea gained traction and the lancos committed to the idea, the TWL CEO, Larry Andagali, a huli man threw himself into the project.  He and B4D's PNG lead, Noel Kuman, visited the village communities and spoke to hundreds of people. By sheer strength of personality, he engaged their interest. 

The Hela Province has a number issues with clan violence, disputes, and murders on a too frequent basis.  When we first visited the Nogoli-Hides site on a fact-finding mission in 2012, we were escorted by a police vehicle or a policeman traveled with us in our Landcruiser. This was because of the ever-present risk of clan violence. Over the four years while we were working in Port Moresby, the clan violence in the region became worse. It was not helped by the death of the governor in 2013, and then two elections that were deemed unconstitutional after 2015 high court proceedings.

Even when the new governor was finally elected the clan fighting continued.  Over the six months to September 2016 about 120 people were killed in the Province as rival clans carried out their revenge for each successive insult, murder, or house burning.  The root of the problem lay with land ownership, entitlement, and inheritance. At the peak of the violence a gun battle between the police and a clan ensued in Tari, the provincial capital. Tragically, a policeman’s son was killed. During the battle, the police needed to withdraw because they were simply outgunned. Historically clans have been poorly armed because their only means of accessing guns was through stealing from the military. However, more recently they have increased their access through trading arms over the border with West Papua. To stabilise the situation, the governor sought assistance from the army and 150 soldiers were deployed to the Province to achieve an uneasy peace.

Photo above:  Villagers in front of a pig house they had constructed for Henry, Nogoli.

Photo above: Training course led by Poge, at Nogoli.

In 2016, we conducted a training at Henry’s training lodge in Nogoli. There had been trouble the night or two before the course was due to start. The attendees came to the course in an escorted convoy. Like all compounds in the area, we were surrounded by a 2.5 M high mud wall (a Huli fence), so we couldn’t really see out. During the morning, while we were waiting, we heard what sounded like gunshots. There was a deathly silence amongst our group. The tension was palpable. Then more shots, except they were firecrackers, and a religious procession was underway on the road outside the compound.  

The concept we developed for what became known as the Community Pig Enterprise was based on the idea of a sow farm producing about 80 pigs per week. These would be grown from 6 weeks of age in village pig houses under a contract arrangement. Based on the performance we achieved at Alstonia Farm, each villager should be able to put at least 20 pigs per year through their pig house.  They would be paid a fee for raising each pig. The villagers could buy the pigs from the sow farm, if they had the funds, and own them. However, they had to sell most of them back to WAL, which owned the sow farm and the abattoir and processing facilities. The villagers would supply the kau kau or cassava (the energy source) to feed the pigs and buy from WAL the protein supplement necessary for efficient growth and high quality carcases.  

Most of the villagers could not afford to buy the pigs and build a pig house.  We didn’t know if the villagers, having grown the pigs, would sell them back to WAL to be processed for any price let alone the contracted price. Did they even understand a contract? It is said that in PNG, true negotiation started when the contract was signed

Photo left: Kau kau in a household garden, Nogoli

We were also unsure if the local people could grow enough kau kau.  While some men were wealthy, had multiple wives and owned as much as 100 acres of land, it was often in small parcels, spread over a district. This meant if the crop failed in one part there would always be reserve plantings elsewhere 

 Photo above: Women preparing a field to plant with corn near  Koroba

The work in the gardens was done by the women, who also looked after the pigs.  At times, the women had to walk several kilometres to their gardens. Typically, at the end of  a week or month, they might have a few kilograms of kau kau surplus to sell in the village market. I wanted them to produce five tonnes of kau kau to feed ten pigs, and then to do it all again in the following six months. Could they do it?  And, would they do it at a price that was competitive with the value of wheat?

Three kilograms of kau kau had the energy value of about one kilogram of wheat.  So, if wheat was worth 1300 PGK (~AUD 475)  per tonne landed in Port Moresby, the kau kau was worth about 450 PGK (~AUD 165) per tonne.  Of course, any wheat transported up the Highland Highway from Lae cost a lot more than 1300 PGK when it arrived in Tari, but we were competing with pork imported in containers from Australia.  If our meat cost too much to produce, we wouldn’t be able to sell it at a high enough price to make a profit because the imported product put a ceiling on price.

 

Photo above: Local market in Juni, Hela province

The little stacks of kau kau that the villagers had to sell in the market each year brought about 1,000 PGK per tonne.  The company could never pay that much for kau kau and expect to make a profit from pig production.  WAL was offering the villagers an opportunity to produce kau kau in volume and make in a year about 4,000 PGK from kau kau production. END