Gov’t Injects $29 Million in Coffee Industry

More than 4,000 of the island’s coffee farmers are to benefit from a $29 million grant being provided by the Ministry of Agriculture and Fisheries.

Portfolio Minister, Hon. Roger Clarke, who made the announcement at a press briefing at his Hope Gardens office on February 23, said it is estimated that this grant will “contribute some 30 to 40 per cent towards a better crop for the 2012/13 crop year”.

He informed that the lion’s share of $20 million will go towards providing fertilizer. The remaining $9 million will assist efforts to counter the dreaded coffee berry borer, including assisting the Coffee Berry Borer Task Force to effect pest control and eradication.

Mr. Clarke said that fertilizer will only be distributed to farmers, who have registered with the Coffee Industry Board and who have delivered coffee within the last 24 months. He noted that the berry borer task force is contemplating price support for chemicals required to assist in disease control.

Mr. Clarke told journalists that the Ministry’s intervention, for which Cabinet approval was sought and received, is in recognition of the prevailing challenges facing the coffee industry and its stakeholders. 

He pointed out that the global economic recession had significantly reduced demand from Jamaica’s three main markets – Japan, the United States, and Europe, which has resulted in significant reduction in prices paid to farmers, and declines in purchases by the private coffee dealers.

Mr. Clarke informed that the Ministry responded to the plight of the farmers by organising a special $310 million loan to assist in taking off the crop, albeit at a “lower than usual price”.

He said, however, that the payment made was the minimum price, with farmers supplying beans to process Blue Mountain brand coffee receiving $2,400 per box, and $1,500 going to those providing beans for the High Mountain brand.

The Agriculture Minister said these prices, coupled with delayed payments, failed to provide the necessary cash flow and stimulus to enable the farmers to properly tend to their crops. This, he lamented, has resulted in a fall-off in production, consequent on reduced quantities and timeliness of inputs, coupled with attrition in farmers from the business, estimated to range between 30 per cent and 35 per cent.

He noted that the reduced interest and subsequent attrition resulted in inadequate attention being paid to the coffee berry borer, bemoaning that the pest is threatening this year’s crop.

The Minister said the $29 million injection, while a small portion of the resources needed, is indicative of the Ministry’s understanding of the “severe” challenges facing the sector, and underlined government’s commitment to facilitating growth and rebuilding of the industry.

He said it is estimated that $120 million “would just begin to provide an adequate inputs programme to replace the reduction in earnings lost by the farmers”.

“But I am confident that with all of us playing our part, that the industry will be able to re-gain its pride of place as one of Jamaica’s champion foreign exchange earner(s), and a jewel in the crown of agricultural products,” Mr. Clarke stated.

The Ministry’s intervention was welcomed by President of the All Island Coffee Growers Association, Derrick Simon, who invited other key stakeholders to follow suit, in order to bring “completeness” to the sector’s restoration. In the same vein, he urged the farmers to ensure that the intervention yields significant dividends.

“We have to ensure that the investment of the Ministry is properly protected…and…that it will redound…economically (to the sector) climbing out of the quagmire (it is) now in, and that we never retrogress to this stage again. So, let us not let down the Ministry, but let us follow suit to bring completeness to the initiatives that the government has brought at this time and for (the money) to be used wisely,” Mr. Simon urged.

General Manager of Mavis Bank Coffee Factory Limited, Senator Norman Grant, in endorsing Mr. Simon’s sentiments, said that based on data, the projected yield for the 2012/13 coffee crop was 140,000 boxes for processing the Blue Mountain brand, and 50,000  for others. This, he said, was a significant fall-off from the 400,000 boxes produced, in previous years.

“Therefore, it is very strategic that you (Ministry) have come on board at this time, to issue this life-line and this rescue for the farmers,” he stated.

By Douglas McIntosh, JIS Reporter