Mixed basket for new crops
LOCAL agriculture stakeholders have mixed feelings about the progress of the sector’s non-traditional export segment, once a representation of hope for the future viability of the crippled industry.
In the mid-2000s, Jamaica’s agricultural sector appeared to be at a crossroads. Against the background of a new World Trade Organisation (WTO) tariff regime that would eliminate the preferential access system that Jamaica’s sugar and banana exports enjoyed in the European market, the island was staring in the face of a significant fall-off in output of those very critical traditional crops. At the same time, a big increase in earnings of non-traditional exports such as ackees and ethanol was the platform from which industry interests had identified future growth, and indeed a shift of focus, to that segment of the market.
“The Jamaica Exporters’ Association (JEA) had always been focused on increasing the export of our non-traditional exports in the certain knowledge that the advantages that we enjoyed with traditional exports, and hence the earnings being derived from them, would not last,” said former JEA president Dr Andre Gordon.
“As a result of this, we initiated several programmes to assist the development of non-traditional exports, including agricultural products,” he explained.
Aside from ackees and ethanol, Gordon said the JEA worked with exporters to significantly increase the exports of papaya, yams and other non-traditional fruits and vegetables. He added that the association also worked with the United States Department of Agriculture and the Ministry of Agriculture to establish the pre-clearance facility that is located at the Norman Manley International Airport and helped to improve the technical capabilities, as well as the business and food handling practices of exporters.
Looking now at the overall progress of the sector, the JEA past president opined that the non-traditional export segment has performed “reasonably well, all things considered”.
“When the inevitable decline in traditional exports began, by 2007, we had more than replaced the fall-off with the increases in non-traditionals, with major contributions coming from food, beverages, petroleum-based exports, chemicals and ethanol,” said Gordon.
“We had targeted the growth in the value of ackee exports to US$12 million from US$4.4 million in 2000. We have surpassed this and should have finished 2010 at over US$13.1 million; this has performed better than expected. We have also seen significant growth in Baked Goods, which was unexpected, plus yam exports have also done well, as have beverages and sauces,” he noted.
Data provided by the Statistical Institute of Jamaica supports Gordon’s general assessment, with earnings from non-traditional exports increasing by 55 per cent from US$341.6 million in 2005 to US$530.5 million in 2009. Specifically, yam earnings increased by 50 per cent from J$1 billion in 2007 to J$1.6 billion in 2009; while papaya earnings increased by 36 per cent to J$253 million; sauces increased by 68 per cent to J$933 million and baked products increased by 62 per cent to J$951 million over the same period.
However, Gordon acknowledged that he is disappointed in the fall-off in petroleum product exports and the hit the country has taken in the exports of chemicals, which includes ethanol. Export of the latter has experienced a steep decline since 2008 when it earned US$449 million — earnings fell by 55 per cent to US$203 million in 2009 and, up to the end of September 2010, was on pace to decline by a further 66 per cent last year.
The move towards ethanol production during the 2000s was one of the much-talked-about initiatives that was expected to breathe new life into a sugar industry on which many had given up. One farmer who has not given up on the sugar industry but is disappointed about the level of progress it has made in terms of expanding into producing non-traditional co-products, is president of the All Island Jamaica Cane Farmers’ Association (AIJCF) Allan Rickards.
“I’m not happy at all,” said Rickards, adding that he “anxiously” awaits the outcome of the Sugar Industry Commission which was held last year and which the Ministry of Agriculture is set to put before Cabinet with its recommendations.
“I anxiously await the outcome of that because it should signal the parameters within which we go forward in this industry, and the fact of the matter is that the basket of co-products must come into being and come into being now,” continued Rickards, noting that “Ethanol may not be the only or best one… there is the much-spoken about co-generation of power, which is done in other places like Hawaii, where the major income from sugar cane is from the generation of power for the national grid (and) we are still talking about feasibility studies in the refining of sugar and other value-added measures.”
What’s for sure, said Rickards, is that the transformation is needed urgently.
“It has become even more dramatic that the income from the sugar cane must be augmented by what we have been talking about for decades and what we have been backward in coming forward with,” said the AIJCF president.
“We need to stop talking and do it… One watches anxiously because, quite frankly, if we don’t find a way to increase income from cane, then a lot of the small and medium cane growers are going to be in serious trouble,” he added.
Norman Grant, senator and immediate past president of the Jamaica Agricultural Society (JAS), believes that the non-traditional export sector has performed “way below potential” and also called for the Government to create the framework necessary to enhance growth.
“I still believe in 2011, the support that needs to be accorded to the agricultural sector, and agroprocessors certainly needs to be more indepth in order to transform these opportunities that exist in non-traditional exports,” said Grant. He noted that “There are still huge opportunities and one of the problems we face in Jamaica is that the support for the local farmers and exporters is still not up to par when you compare support that the counterparts have been receiving in more developed countries and even Trinidad.”
For instance, Grant said, interest rates are trending down but yet there is still a problem with accessibility for farmers.
“I’m now calling for a special tax-relief programme whereby, to drive the non-traditional industries, the Government should give an incentive to new operations and incentives to existing factory operations that want to expand so that farmers can in an exponential way go into further production,” said Grant.
The former JAS president said, however, that he was pleased in the performances of ackees, yams and canned callaloo.
Gordon added that the JEA is confident that, given the appropriate support from the state sector and international partners, the country can grow authentic Jamaican products and services in virtually all categories significantly over the next five years.
“This would likely be led by our signature food and beverage items, but could also include specific services as well,” said Gordon.
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