Wednesday, January 7, 2009

Nest Farming: Indonesia, Malaysia: 70% Failure, Philippines: 83% Success, Part II

The esculenta, grass-nest or white-bellied swiftlets are found all over the archipelago. The species also nests in houses, even populated houses. While their nests are virtually worthless, esculenta colonies serve as the host for fostering fuciphaga or white nests swiftlets. In Indonesia, for convenience, fuciphaga is called walet while esculenta is seriti. For our purpose, and following Indonesian practice, I will refer to esculenta as swifts and to fuciphaga as swiftlets.

Having learned from by purpose-built farm failures where I had hoped the birds would follow me, I decided to do the reverse, to follow the birds to their colonies. At this time both my purpose-built farms were still empty.

Swift house colonies abound across our archipelago. Having begun locating these house colonies, I was surprised to find them quiet common. In some instances the owners have given up trying to drive the birds away and have abandoned that part of the house to the birds, usually the living room. I have reports of house colonies from Luzon to Mindanao.

Figure 2. Esculenta house colony in Northern Mindanao. The owner installed wooden ledges under the nests to catch bird droppings.

Having heard of egg-fostering technique from Indonesia, I decided to apply it here. Egg-fostering simply means replacing the swift eggs with swiftlet eggs. The adoptive swift parents raise the swiftlet hatchlings and the fostered birds return to the colony to nests.

Figure 3. Esculenta colony in an inhabited house in Southern Mindanao. The owners had already cleaned out the colony but the birds returned. Swiftlets have a very powerful site fidelity instinct.

There are only two important things to keep in mind when conducting egg-fostering. First, the host colony must number at least 100 nests. This means about 300 birds, including non-nesting juveniles. The colony will still survive should the fostering effort fail. Second, both egg sets must be approximately the same age.

Figure 4. Fostered fuciphaga hatchlings above an older esculenta nestling about to fledge.

Figure 5. Esculenta (left) and fuciphaga (right) nestlings, about the same age. Notice the smaller size and darker, metallic plumage on esculenta and the larger and brownish fuciphaga.

Both species reach sexual maturity in 10-11 months. You should begin to find white nests a little less than a year after the fostering was conducted. After the initial clutch of eggs, and depending on the season, the birds should breed every four months. The first nest will still have some organic material like grass or straw but will already contain more saliva than swift nests. These are called transition nests and are best left alone for at least two breeding cycles.

Figure 6. Transition nest with eggs. Note the higher saliva content but still lower than a mature fuciphaga nest.

Friday, December 26, 2008

Nest Farming: Indonesia, Malaysia: 70% Failure, Philippines: 83% Success

Early this year (2008) I set as a personal goal to be the Philippines’ largest producer of farmed/cultured edible nests. This appeared to put a focus on my activities until I realized that there are no nest farms in the country, automatically making be the biggest – and the only – EBN farmer in the Philippines! I have heard anecdotes of houses with swiftlet colonies where nests are regularly harvested but I have not been able to confirm these reports.

At any rate, during an EBN conference I attended in Genting Highlands, Malaysia in 2005, among the most interesting pieces of information I came across was that the failure rate in the EBN farming industry was very high – around 67%! The 2007 Malaysian Industry report further confirms this and even provides several explanations for this phenomenon.

To my mind, this data confirms one thing – that EBN farming is very lucrative. So lucrative that many entrepreneurs plunge into the business with very little knowledge about the technology involved. In Indonesia and Malaysia, the number of nest farms has expanded faster than the bird population. But even in Indonesia where the technology was developed, the failure rate remains high.
In 2005 I enlisted an Indonesian consultant (my second consultant, the first being a couple of Malaysians in 2004) to assess the local environment. He concluded that our environment could support a large swiftlet population. The Malaysians, who visited Palawan, conducted several sound tests with disappointing results. They concluded that the local swiftlet population, at least in Palawan, was “severely depleted”.

Early in 2006, unfazed by this knowledge, I build my first two nest farm structures in Southern Mindanao applying technology learned from Indonesia and Malaysia. The structures, excluding the cost of real estate, costs between P250-P300 thousand each. My design proved effective, at least insofar as maintaining the internal temperature lower than the outside temperature without the use of any equipment.

Figure 1. Pilot farm in Davao del Sur. Open space between ceiling and roof limits the radiation of heat into the nesting area inside the structure. Roof is nipa; walls are cement board.

My site selection was based on two criteria: First, from observation I believed that these areas were swift habitats and, second, I would not spend for the cost of the real estate.

It took 18 months before I saw my first nest and in only one farm – in November 2007. No attracting technology was used. No sounds, aroma, etc. Today, December 2008, more than twelve months after, this farm has 20 nests. The other farm remains empty. The nests, by the way, are esculenta or grass, nests.

A successful farm should produce nests of sufficient quantity to recover the investment within a reasonable period of time, say, three to five years. Therefore, to recover my cost I need to produce 1.25 kilos of white nest per year within five years, and since I only have 20 grass nests (although the colony increase should be geometric, not linear) I would be a doddering, geriatric case before I harvest my first kilo of white nests! It was time to shift strategy.

To be continued.....

Saturday, November 1, 2008

How Much Can You Earn From EBN Farming?

This is the question the prospective nest farmer will ask before he ventures into EBN farming. It is also a very important concern. Unfortunately, this information is a closely guarded secret by those actually engaged in the business. Obviously, merchants will have to reveal their buying price to their gatherers/collectors but very rarely will they divulge annual earnings.

To have an idea, we will have to rely on the experience of nest farmers from Indonesia and Malaysia. Harry Kok who maintains a blog at has written:

Birdhouse Farming is unique. The main advantages as compared to investing into a conventional business are:

1) The amount to invest is low. Around RM120,000 (US$ 35,881.77/PHP 1,573,416.00) ) to buy a worn-down shop lot, 2 stories, and renovate to attract bird to nest. Renovation is about 20K (US$ 5,980/PHP 262,223.00) per floor (estimated). Total outlay is RM160,000 (US$ 47,839/PHP 2,097,740.15). (U can take a bank loan if U know them well).

2) Monthly utility cost(electricity and water only) is very low. Roughly about 10-20 ringgit (US$ 3-6/PHP 131.55-263.10).

3) If U compare with a conventional business U will have no monthly fees to feed the birds or so except your monthly payment to service your loan. There are no Salaries to be paid, no EPF, no Socso, No holidays, No allowances, No medical leaves, No maternity leave, no retirement fees and no etc etc etc. My employee is actually the birds. They come into the house on their own accord. No contract and no letter of appointment. The best is that they never talk bad about you or back stab U. U let them use your shop lot to nest and the will eventually say thank U by leaving their nest for us to harvest continuously until they die.

4) U only need to check on a monthly basis on the condition of the birdcall music and water spray.

5) Once the bird start to make their nest, you will now hit a jackpot. Your income will steadily increases or multiply by 3 every year. (Note the birds will reproduce every 4 months ie 3 times a year.) Beside that your bird’s nest house value will start to climb in value base on the number of nest that U have in it. Let say U have a hundred nests. Each nest, rule of the thumb, will be worth RM1000 (US$ 299/PHP 13,111.15). As an example.: If U pay 120K for the shop lot and 40K for the renovation of the two floors and U now have 100 nests, the value is 120K + 40K + 100 nests X 1000 = RM260,000 (US$ 77,737). If the next year U have 200 nests, the value now is 260,000 + 100,000 = 360,000 (US$ 107,642/PHP 4,720,101.70). No other business can multiply your asset value as fast as this Bird’s nest business.

6) You can harvest the nest once in every 3 months in the beginning and slowly to 2 months. The best is to start harvesting after the first year of operation. Allow the bird to settle down and breed and multiply to a reasonable numbers. Every 120 nests ie 1 kilo is equivalent to 4,000 - 7,000 Ringgit (US$ 1,196 – 2,093/PHP 52,444,60-91,778.00) depending of the quality and shape of the nests.

7) If you are lucky by year 5 after the 1st nest was built, U will earn about 120,000 ringgit (US$ 35,882/PHP 1,573,425.70) every harvest assuming that you will harvest about 50 kilo of bird’s nest. This is equivalent to 60,000 (US$ 17,941/PHP 786,712.85) a month income doing absolutely nothing.

8) U can then start to multiply the number of units to the maximum from the income U receive.
I guarantee U that U will be a millionaire within 10 years of operation. This guarantee is subject to U following some pertinent rules and regulations that most birdnest farmers do. There are various methods where you can have a piece of the cake. The best is to form a partnership with a few investors and form a venture.In this way your investment is low and the risk is distributed.

- 0 -

For a three storey shophouse of 20' x 70', how many nests can we collects per month when all the wooden planks are been taken up by swiftlets ?..If you have adopted a matrix system of 1' x 3' matrix box when installing the wooden planks, each box will be able to accommodate 14 nests max. The total usable area for each floor of the farm is as follows :
- The 3rd floor - Total usable area is 1,160 sq ft (minus roving room area).
- The 2nd floor - Total usable area is 1,400 sq ftThe Grd Floor
- Total usable area is 1200 sq ft (minus control rooms area).
So, Total usable area is 3,760 sq ftWith each sq ft could accommodate max ~ 4 nests.3,760 sq ft x 4 nests = 15,040 nests.
For a 3 storey shop, each year we could harvest maximum 45,120 nests. And with each nest weight min 8 gram.Total Harvest (kg)/ year = 360KG. With the wholesale price of raw nest at RM4,500,Total harvest income per year is equivalent to RM1,620,000.00.
This is equivalent to RM 135,000.00 a month.

- 0 -

I would encourage everyone to visit Harry’s blog as it serves as a clearing house for information on EBN farming. Take note, however, that our conditions are different from those in Malaysia and Indonesia.

Friday, October 17, 2008

Distribution of Edible Nests in the Philippines

At first thought to be found only in Palawan, edible nests actually are found in other parts of the Philippine archipelago. Nests have been found in as far north as Cagayan and as far south as Sulu. In between they are also found in Samar, Leyte, Bohol, Mindoro, Bicol, Davao, Cotabato, Agusan, Misamis Oriental, Camiguin, Bukidnon and Surigao. These nests are collected by local inhabitants and sold to a local buyer who in turn sells them to a dealer in either Zamboanga, Davao, Cebu or Binondo. The cleaned and processed product usually ends up in China carried by traveling Chinese-Filipinos as pasalubong.

Cultured nest from Malaysia. Triangular shape
indicates its a "corner" nest, which lowers its price.
These nests fetch between US$1,500-$2,000 farmgate.

Local nest sample from Mindanao. Cleaned, these nests fetch up to P18,000.

Mindanao nests fetch a lower price (P15, 000 – P25, 000 per kg) than Palawan nests (P180, 000 per kg as of Sept 2007), both unprocessed. Raw local nests are generally classified as first, second and third classes depending on the color, saliva content and shape. The local selling price for these nests range from P28, 000 to P630, 000 per kilogram, processed. Unregulated gathering has severely depleted the swiftlet population and threatens the sustainability of the edible nest-gathering industry. This threat, of course, does not apply to cultured nests. However, the Philippines does not have a cultured nest industry – until possibly now.

Esculenta colony inside a house in Bukidnon. Swift colonies in houses can be
found throughout the archipelago.

Thursday, October 16, 2008

Creating the Philippine Cultured Edible Birds' Nest Industry

It’s All About China: By 2010 many experts believe that China will have eclipsed the U. S. and Europe as the world’s biggest economy. China’s economy has been growing at a frenetic pace for about two decades and this trend is expected to continue into the foreseeable future. If China buys, the world suffers a shortage. This can be seen in the demand for oil, steel, rubber and the ultimate Chinese epicurean delight – edible bird’s nest.

The demand for edible bird’s nest (EBN) has always exceeded supply and in 2006 farm gate prices (Malaysia) ranged from US$1,200 to $1,800 per kilogram. Prices for processed nests prior to consumption in Hong Kong were from US$6,000 to $7,000 per kilogram. Total retail turnover in 2004 was estimated at US$ 1.3 billion; by 2006 this had ballooned to US$ 3.8 billion. Historically, demand has grown at approximately 15% a year.[1]

Suppliers of Edible Bird’s Nest: Indonesia (60%), Thailand (20%) and Malaysia (15%) are the major EBN producers with Vietnam and Myanmar steadily increasing their production. Nests are also sourced from Sri Lanka, India and – the Philippines. There is no record of Philippine production figures although traditionally the nests are found in El Nido in northern Palawan.[2]

World’s Top EBN Producers, 2006[3]

Indonesia - 60%
Thailand - 20%
Malaysia - 15%
Vietnam, Myanmar, etc. - 5%

Cultured Edible Nests: Originally the swiftlets that produce the nests settled in caves but today the technology for culturing the nests in purpose-built structures exists. The technology was first developed in Indonesia and was transferred to Malaysia by Indonesian ethnic Chinese after the Indonesian race riots in 1997.

Today Indonesia is estimated to have at least 150,000 nest farms while Malaysia, which had a mere 150 nests farms before 1997, reports 30,000 nest farms by mid-2005. Thailand, a latecomer, now has 70,000 farms while Vietnam has 5,000 farms. There are no nests farms in the Philippines.

[1] Hai and Lee. The Complete Introductory Guide to Swiftlet Farming, .Struan Inc. Sdn. Bhd, Penang, Malaysia, 2006.
[2] Philippine annual production is estimated at 5 tons.
[3] 2007 Malaysian Swiftlet Farming Industry Report

Tuesday, October 14, 2008

Creating Sustainable New Wealth

The purpose of this blog is to encourage the creation of an industry that will create wealth for Filipinos, many of them living in the edge of our social, political and economic currents. The Philippines holds an enormous potential for cultured edible birds' nests (EBN). In 2007 the world market was estimated at US$4 BILLION, up from US$1.7B in 2004. Malaysia's industry estimates that the market will grow by double digits for at least the next two decades. If Indonesia has approximately 150,000 nest farms and Thailand, 50,000, Malaysia, 36,000, then a few thousand nest farms lies entirely in the realm of possibility for our country. Philippine production figures are not reflected in the region's reports but is estimated at 5 tons a year - a drop in the bucket of the 200 tons a year market. All of these nests come from caves harvested with little regard for the breeding cycle and sustainability of the trade. Unless nest farming technology is adopted, the famous El Nido nests will be a thing of the past, like T. Rex.
The information contained in this blog is open to all and is the result of almost five years of research and experimentation on EBN farming in the Philippines. Comments are most certainly welcome.