Tue | Sep 25, 2018

Recapitalise coffee production - Salmon

Published:Friday | October 17, 2014 | 12:00 AM

Donald Salmon, president of the Jamaica Coffee Growers Associa-tion, is calling for the recapitalisation of the coffee industry through targeted government aid for farmers and a window for soft loans to finance farm inputs.

He is pushing for state rescue even as he accuses government policies of impoverishing many small coffee farmers - citing inadequate extension services, lack of access to loans, and low subsidies, which affect input costs.

"How can you have a product that everybody in the world wants and yet it is a hand-to-mouth business?" said Salmon, when reached for comment on the issues he first raised at a forum last month.

Some 10,000 farmers produce coffee in Jamaica, but their search for capital is constrained by lack of insurance and land tenure, said Salmon, who notes that since 1987 coffee production has fallen from 700,000 boxes to 190,000 in 2014.

The crop of coffee farmers, he said, include groups who squat on the land they cultivate, some who lease property, and others who have received family land by gift but have no legal documents to prove their ownership.

Farmers on lands which have been divested to Michael Lee-Chin's AIC International, he adds, are required to supply beans to that estate.

Salmon said Wallenford's farming lands were originally leased to farmers in 2000, when the property was owned by the State, and that the recent sale of the coffee estate was done without consultation with the group.

"These coffee farmers are excluded from the free market," he said, charging that it "discourages investment".

However, permanent secretary in the Ministry of Agriculture, Donovan Stanberry, said the JCGA president's claim was a bit disingenuous, as every coffee and sugar cane farmer is registered to deliver produce to a particular estate, often based on proximity to factories.

"Even if the estate had not been sold, they could not sell their coffee to Mavis Bank. Every single coffee farmer must sell to a particular processor. These people have invested money in a processing facility. You have to arrange the thing so you can arrange throughput," said Stanberry.

"In a similar way, sugar cane farmers near to Monymusk must supply to Monymusk. This is how the licensing and registration system works," he said.

The Jamaican Government has in the past few years divested its commercial coffee holdings as part of its new strategy to focus solely on oversight of commodities markets and leave the business of owning and operating assets to private investors.

The Mavis Bank Coffee Factory was sold by state-owned Development Bank of Jamaica to the Jamaica Producers/Pan-Jamaican consortium in late 2011.

Salmon said that since the divestment of Mavis Bank and Wallenford, the State has pumped no funds into the sector.