Promoting efficiency through expanded scale of production

The Pingtung Agricultural Biotechnology Park

　　The Pingtung Agricultural Biotechnology Park (PABP) aims to attract a critical mass of investors that will create a highly efficient industrial cluster. As of the end of 2014, the PABP had approved investments from a total of 96 firms, with cumulative investment of NT$8.92 billion. Of these, 75 firms have already moved in and begun operations, driving annual production value of about NT$4 billion. We are already seeing industrial cluster effects, as value chains have taken shape involving upstream and downstream producers.

　　The COA has chosen to promote (a) ornamental fish and (b) aquaculture fry as two core industries in the PABP, and as part of this effort, we have built the “PABP Yai-Tai Aquaculture Center.” It formally opened on November 1 of 2014. So far 10 firms (all in fields related to ornamental fish) have received approval to move in. Also, to ensure rapid customs clearance for importing and exporting firms, the Center has established a special facility—managed and operated by a professional logistics firm—for goods that are to be imported or exported. Officials from the Customs Administration, the Bureau of Animal and Plant Health Inspection and Quarantine, and the Animal Health Research Institute is assigned to the Center full-time to provide comprehensive services to firms including: (i) health inspection and quarantine, (ii) customs clearance, (iii) warehousing, (iv) logistics, and (v) product concentration, packing, and reshipment (transshipment). These measures will enhance the international competitiveness of our agricultural biotechnology industries.

The Taiwan Orchid Plantation

　　The "Taiwan Orchid Plantation" (TOP) occupies 175 hectares of land, including 95 hectares of space for construction of greenhouses. Basic infrastructure, which was completed at the end of 2012, includes an operations service center, a waste-water treatment plant, an orchid park, a flower exhibition hall, three exhibition greenhouses, three small research greenhouses, and seven pre-fabricated greenhouses that can be rented by firms. As of the end of 2014, 76 firms had signed contracts to invest in the TOP, of which 67 had moved in and constructed greenhouses, and 63 had begun operations and production. Cumulative investment as of the end of 2014 was NT$9.05 billion, with operating revenues of NT$8.69 billion.

Production-and-Marketing Groups and Agricultural Enterprise Zones

　　As an additional measure to promote larger scale operations and industrial clusters, the COA helps farmers to form “Production-and-Marketing Groups” (PMGs) in specific regions or specific crops, and also demarcates “Agricultural Enterprise Zones” (AEZs) for more efficient cultivation of specific target crops. In 2014 the COA constructed 15 AEZs covering 3,925 hectares. To take one example, in the Xinshe AEZ we helped the Xinshe Farmers’ Association construct an industrial value chain for mushrooms, with farmers working under contract to produce specific amounts for marketing. The effect was to raise the incomes of these farmers by over 40%. In another case, the COA provided guidance to the Meinong AEZ for the production of red beans (adzuki), lowering production costs by about NT$3000 for each fen of farmland. (One fen is about one-tenth of a hectare.)

　　The COA also established 14 AEZs for organic farming (covering 642 hectares); nine collective production zones for vegetables (5,200 hectares); 18 collective production zones for flowers (284 hectares); 29 collective production zones for premium quality fruits (1,320 hectares); and a collective production zone for bananas (514 hectares). We also guided production on more than 3,000 hectares of secondary staple crops, including soybeans, linseed, and sweet potatoes.

　　Finally, the COA provided guidance for 34 PMGs for cultivating paddy rice, with contract production covering 16,600 hectares. The contract price averaged about NT$26.5 per kilogram, 16.7% higher than the average market price (NT$22.7), and 6.4% higher than the weighted average for rice purchased for government stocks (NT$24.9). Income per farmer in these PMGs was NT$14,000 higher per hectare in comparison to non-contract farmers.

Modernization of the livestock and poultry industries

　　The COA guides and encourages animal husbandry farms to establish contract production relationships with affiliated processing industries. Examples include contracts among hog ranches, feed factories, and meat processing plants, or contracts between dairy farms and dairy-products manufacturers. By expanding the system of “satellite” livestock farms, “core” processors can be sure of the safety, quality, and steady supply of their raw materials, while farmers enjoy predictability of demand and prices. We are also assisting consulting firms to provide services to farmers on animal-husbandry techniques, feed formulas, and stud services, in order to increase operational linkages, raise production efficiency, and drive larger-scale development of the industry.

　　In the poultry sector, meanwhile, we are focusing on the industrial chain for broilers. In 2014 we expanded guidance of poultry Production-and-Marketing ps and production cooperatives to assist them to truct a more corporatized industrial model, and also to expand contract production. These measures should encourage upgrading of the industrial structure and raise overall competitiveness.

Specialized aquaculture production zones

　　In 2014 the COA continued to develop sustainable aquaculture that will exist in harmony with the environment. We completed planning for 26 subsidized infrastructure projects, with total subsidies of NT$160 million, in order to improve the operational environment in aquaculture areas. Besides reducing usage of fresh water for aquaculture and reducing dependence of aquaculture ponds on underground water, we also upgraded the drainage efficiency and flood-prevention capabilities of aquaculture production zones and aquaculture clusters. These steps will enable the aquaculture industry to satisfy domestic demand for seafood as well as to develop overseas markets, drive economic development in fishing communities, ensure the economic security of citizens engaged in aquaculture, and promote sustainable development of the aquaculture industry.

Promoting value-added niche industries

Tea industry value chain

　　In order to upgrade and expand the tea industry value chain, the COA is guiding 43 tea manufacturers, tea businesses, and farmers’ associations to invest in operating teashops or teahouses, or to invest in the tea services industry. We intend to extend the first level of tea production and the second level of tea-product manufacturing industries into the third level of tea-related consumer services. For example, we have selected seven teashops or teahouses with uniquely attractive features to promote as models for introducing premium teas and tea culture to consumers.

The rural wine and liqueur industry

　　The COA has guided 23 farmers' organizations to establish wineries, and in 2014 total production was 188,000 liters, with production value of NT$176 million. In addition, the COA has selected the most outstanding wines or liqueurs to participate in international competitions, and in 2014 products from Taiwan brought back four gold medals and three silver medals. Also, following evaluations of rural wineries and their products, 12 wineries were evaluated as "outstanding" or "premium quality." Finally, as with tea, the COA is also assisting rural wineries to add a "third level" as a provider of consumer services and experiences.

Improved chicken eggs

　　A new provision was added to the "Statute for Prevention and Control of Infectious Animal Diseases" (specifically, Article 14, Paragraph 4) regarding packaging and transport of fresh eggs, which requires that they be transported in single- use packing materials. The COA is also working to encourage greater use of paper egg cartons, and has created a demonstration model of transport and sale of domestic chicken eggs using "handcart transport paper cartons." By introducing improvements in packing and shipping, producers can claim higher grading for their eggs, and raise prices for the niche they occupy in the market. In the long run this creates an incentive for all egg producers to upgrade quality and improve packing and shipping methods.

Premium quality seafood

　　In 2014 the COA continued to implement quality screening for seafood by rewarding high-quality producers with the right to use the special “Haiyan Premium Seafood” label. Through a two-stage evaluation process, we selected 20 premium seafood products which can now use the “Haiyan” label, which represents safety, quality, and fashionability. The program is aimed at achieving branding value for seafood from Taiwan, which will upgrade the whole industrial value chain.

Boutique forestry products

　　In 2014, the COA: (a) guided 34 makers of forestry products to join in the "Exhibition of Forestry Boutique Products”; (b) held three activities to publicize innovative technologies (techniques) for forestry products and to do business matchmaking; (c) organized 29 firms into two clusters (one for the "Taiwan Charcoal Industry" and one for the "Bamboo Construction and Home Improvement Industry"); (d) constructed industrial value-chain linkages; and (e) expanded marketing for boutique forestry products. In 2014 this niche sector produced value of over NT$3 billion.

"Rural regeneration" and synergy with local economies

Manpower training

　　The first step in revitalizing rural communities and creating synergistic development of local economies is to have skilled human resources in place at the local level to do the necessary planning and implementation. The COA undertakes manpower training at the village level to develop people who can make plans for, integrate, and utilize community assets. So far we have offered training in a total of 2,206 communities, with 142,423 attendees, and 501 of these communities have drafted their own rural regeneration plans.

　　To meet the demand among local activists for learning how to grow and develop rural communities, and to build a sense of partnership between the COA and people being trained at the local level, in 2014 the COA instituted the “Rural Regeneration Community Activism and Partnership” mechanism. This provides training and resources to localities whose rural regeneration plans have already been approved, to help them transform the unique features or assets of rural communities into economic assets and centerpieces of community vitality. We have assisted 450 rural communities in implementing their rural regeneration projects, turning their visions for the future development of their communities into reality.

Invigorating community industries

　　Another fundamental step in rural revitalization is taking a clear inventory of local conditions and assets. The COA has subsidized inventories and analysis of existing “industry resources” (i.e. local assets for particular types of economic activities or products) in rural communities. Equipped with this knowledge, these communities can diversify their economies and better utilize local economic assets that have a special character and appeal. So far we have completed a total of 525 studies.

　　Coordination is also essential. The fact is that many organizations— including units of the COA, local community groups, private-sector businesses, non-profit organizations, and non-COA government agencies—have all been working to help rural communities improve their economies. Here at the COA we have been trying to integrate overlapping programs across disciplines, with the rural regeneration plan as the governing document, in order to develop a coherent and focused strategy for each community. Following intensive discussion of the problems faced in developing local rural economies and countless meetings and studies, as of the end of 2014 we had approved demonstration programs in a total of 21 communities serving to interface and coordinate 90 existing programs.

Raising the quality of the living environment in rural communities

　　The COA aims to construct rural communities that have a high quality of life and offer a feeling of security to those living there. To do this we must take into account the unique appearance, lifestyles, industries, and environments of each community, and make use of local assets and materials. Both "software" and "hardware" aspects of rural regeneration infrastructure must be integrated into a coherent way of life that reflects the authentic local rural aesthetic. In 2014, the COA assisted 1,482 rural communities to undertake improvements in basic production conditions, convenience of daily living, and beautification of unsightly locations.

Recruiting young agricultural manpower and maximizing land availability

Guidance for young farmers

● Among policies designed to help young farmers are the following: (a) The COA has guided 15 county- and city-level farmers’ associations to establish local platforms where young farmers can interact, exchange information, and lend mutual support. At present there are over 1,150 participants, with an average age of 35. (b) In June of 2013, we selected the first cohort (one cohort per year) of 100 young farmers for individualized tutorial programs. As of the end of 2014, the following results had been achieved: (i) over 4200 separate expert consultations, (ii) 1100 problem consultations, (iii) subsidies of over NT$15.3 million for equipment and facilities, (iv) special- case agricultural loans exceeding NT$84 million, (v) introduction of 92 new varieties, technologies, or techniques, (vi) help with product design and creating a "brand story" in 153 cases, (vii) introduction of ICT or automated systems in 17 cases, (viii) testing and certification of 190 products, (ix) R&D on processing methods for 102 items, (x) assistance in finding sales outlets in 200 cases, and (xi) enlistment of 35 new members in cooperatives or Production-and- Marketing Groups.

● Moreover, we: (a) provided expert advice to help farmers create innovative value-added, selected 11 specific plans, and drove investment in excess of NT$4.8 million; and (b) organized, on a trial basis, five clusters of young farmers growing grain and animal fodder, with two “statements of intent to cooperate” already signed between these clusters and downstream companies. Finally, in December of 2014 we completed selection of 82 new farmers and six groups of young farmers (with a total of 24 members) for the next cohort of the individualized tutorial program; their tutoring will begin in January of 2015.

Education and training for farmers

● In 2014 the COA held a total of 157 agricultural training courses, with 4,533 attendees, at four levels: introductory (35 courses), basic (15), intermediate (102), and advanced (5). There were also two courses specifically involving internships for farm managers, with 68 attendees, as well as general agricultural internships, with 121 attendees. There was also one course for the orchid industry, completed by 25 persons, 11 of whom have formally taken jobs in the industry.

● The COA has constructed a “Farmers Academy” Internet information-and-services platform, providing (i) online enrollment, (ii) management of fee payments, (iii) arranging of agricultural internships, (iv) arranging of farmers markets, and (v) online courses and learning. The site has gotten a total of 576,191 visits, assisted 170 people to arrange internships, provided information about arranging farmers-market activities on 98 occasions, and assisted 65 students to participate in farmers markets. The site's “Find Products/Find Sale Outlets” area carried 137 entries about sales channels and 374 about products. The Farmers Academy also has produced 66 issues of an agricultural studies newsletter, to which there are 22,998 subscribers.

● The COA has also been working to narrow the rural- urban digital gap. In 2014 we produced a new digital course for the tea industry, bringing the total number of online courses to 44.

The "Small Landlords, Big Tenants" program

　　In addition to training, young farmers need land. Since May of 2009, the COA has been promoting a policy known as “Small Landlords, Big Tenants.” This encourages (a) farmers who are too elderly to work, or (b) farmers who would otherwise leave their land fallow, to rent their land on a long-term basis to young farmers or farmers’ groups willing to operate large-scale agriculture by combining pieces of rented land into larger farms. (The program includes incentives for renters to cultivate import-substitution crops or crops with export potential.)

　　We also offer incentives to still-working elderly farmers who wish to retire so that they can do so worry-free, making their land available for recruitment of younger farmers and expanded scale of operations. This will create job opportunities for younger people while also increasing economic efficiency.

　　As of the end of 2014, the “Small Landlords, Big Tenants” program covered 15,070 hectares of land, with 29,049 landlords and 1670 “big tenants” (BTs). Importantly, the average age of the BTs is only 44, far lower than the figure of 62 for all farmers nationwide, showing that the policy is helping rejuvenate the farm labor structure. Also, BTs manage on average 9.02 hectares of land, 8.2 times the area of the average farm nationwide (1.1 hectares). Moreover, in the first half of the year 4,695 people applied for the incentive money for retirement, releasing 2,420 hectares of land, while the figures for the second half of the year were 4,987 applicants and 2,560 hectares.