Coffee farmers begin search for own markets
For five years, the Jamaica Coffee Growers Association (JCGA) has held a coffee export licence that its president says has never been used.
But as tensions grow between farmers and coffee traders over the rates on offer for green beans at the farm gate, the growers are dusting off the document with the intent of cutting out the middlemen and marketing their own produce.
But they still have a large hurdle finding capital to expand processing facilities to prepare the beans for export. For that they have gone in search of grant funding.
JCGA President Donald Salmon says processing for the association is currently being done by Trumpet Tree Coffee Factory, which in the crop year ended processed around seven per cent or 16,000 boxes of the crop. The JCGA wants to increase that to triple that to around 46,000 boxes.
Two years ago, coffee farmers were being paid $6,000 per box for their beans by processors and traders. This year, they are getting $3,000, which they say is insufficient to cover their costs and turn a profit. The JCGA is now acting on the threat to work around the local buyers and find their own markets.
"We have the dealers and trademark licence. We are able to trade internationally. We are hoping to send a delegation to Japan in September to explore markets. We are hoping that Jampro will assist us in getting markets," said Salmon.
"We are the new kid on the block. Starbucks and UCC don't buy from us, but we produce good coffee. We are sanctioned by JACRA. We have a model that we are trying to develop whereby we can increase by increments purchasing of both high mountain and Blue Mountain coffee but we are restricted by market and capital," he said.
The factory upgrade, he added, is dependent on funding. The JCGA president declined to name the entities approached for grant funding, saying he does not want to engage in "planning in public".
For the crop year ended, total industry output for Blue Mountain coffee was 230,000 boxes. Salmon noted, however, that the current performance is a third of peak production of 700,000 boxes. High mountain coffee, he added, has fallen dramatically from highs of 400,000 boxes to 25,000 boxes.
While admitting that market dynamics have changed, the JCGA president says farmers should be getting a better deal from purchasers of their beans, because they also have businesses to sustain.
"They are also unable to buy fertiliser and other inputs for their farms. We are having a drought in most of the areas. In some areas of western Portland, the berry borer infestation is more than 50 per cent and farmers have begun to abandon farms. They just don't have the money to deal with it," he said.
"I am big on the case to diversify the market we can't be selling our coffee to one market," he added, referring to Japan which currently buys around 70 per cent of Jamaica's coffee. "Without the farmers, there is no coffee. You cannot sell for less than the cost of production that is not sustainable. The traders are trading in US dollars and they can pay more easily. And, remember, when the dollar devalues, the input cost is going up for the farmers too."