JFCA limits cocoa purchase to members
Avia Collinder, Business Writer
Jamaica Cocoa Farmers Association (JCFA) is limiting the bean purchases it makes, to producers who are members of the organisation, which number about 1,600, says president Clayton Williams.
His comment comes in the wake of reports that the state-run Cocoa Industry Board (CIB) has had to turn to the Development Bank of Jamaica for a loan to finance payments to farmers and other working capital needs.
Those negotiations are ongoing, but in the meantime the 6,000 farmers owed have been holding back on supplying more cocoa to the commodity board.
FARMERS WILL BE PAID
Williams said the JCFA has been approached by non-members, but if those producers want to sell to the association, they must "become members by paying a fee of J$500 for membership," he said.
Williams suggested in what amounts to a pep talk aimed at suppliers that they should not be discouraged by the Cocoa Board's current financial status. The JCFA is willing to collaborate with the agency as long as farmers' concerns are being seriously addressed, he said.
"We, therefore, encourage farmers that supply to the CIB to continue doing so and to be assured that they will be paid. The effects of the loss of income will be too great on their community and it will not profit them to see the birds and rats eat away their livelihood," he said.
Williams is also a member of the CIB board of directors.
For those it represents, the JCFA has been paying its members up to J$2,500 per box for their supplies, which is J$500 more than the J$2000 price paid by the Cocoa Board, said Williams.
The JCFA bought only 87.5 tonnes of cocoa in the financial year just ended, said Williams, adding that the association's market prospects are improving.
"The JCFA has received a request to supply buyer countries such as, Japan, Saudi Arabia, Belgium and Germany, but is unfortunately limited only by our ability to supply. We however met all our contractual obligations last year," he said.
"We expect this year to be more challenging, given the adverse effects of Hurricane Sandy on production."
JCFA's market inroads come amid reform of the coca sector, which includes plans to demonopolise the sale of the beans.
TRANSFORMING THE SECTOR
The issue of the licensing of cocoa exporters is yet to be legislated, but the JCFA is actively pursuing exports with the permission of the Ministry of Agriculture.
"We are working with them to facilitate their market needs," said permanent secretary Donovan Stanberry.
"We are changing the entire legislative framework, but that takes time. In the meantime the Board is working with them to assist in selling as much cocoa as they want to," he said.
Williams says JCFA payment for cocoa supplied by its members has been timely and is done through a structured system.
"The JCFA has been collecting cocoa from our members and paying them J$2,500 per box for wet cocoa. We pay our member farmers in two weeks and we do so through direct deposit to farmers' bank accounts," he told Wednesday Business.
"We have been working to transform the sector to help make our farmers more fiscally responsible. NCB has been assisting us greatly in working with farmers by actually going out into the communities to sign up farmers to open bank accounts," he said.
Williams said cocoa was sold to Europe and the United States in 2012, but declined to discuss specific contractual obligations and the revenue earned by the association.
"Our production for the upcoming year is already committed and member farmers can feel confident that all that they supply to the JCFA will be sold at a price point that can be considered at one of the highest in the region. These supply contracts have afforded us the ability to pay the highest farmgate price in Jamaica," said the JCFA president.
Williams meanwhile is encouraging disaffected farmers who have not been paid by the Cocoa Industry Board in several months to continue supplying the board with crops.
He said JCFA continues to work with the Cocoa Board to increase overall productivity in the sector.
"We have committed to purchasing 24,000 seedlings from the CIB to distribute to all cocoa farmers regardless if they are members of the association. The prospective farmer must however demonstrate a commitment to plant these seedlings by undertaking all land preparation work before receiving the seedlings," said Williams.