Donovan Stanberry | Reorienting agriculture for export and to serve manufacturing
My last three articles clinically examined the structure of Jamaica’s food-import bill with a view to understand its composition and to ascertaining what portion of it can be realistically and sustainably replaced.
The analysis shows that at best, we can replace at most 30 per cent of our food imports, given our geophysical and climatic limitations; our small size, which militates against our competitiveness; and our entrenched taste patterns. Even this level of replacement will require concerted and deliberate effort from our farmers, the private sector, and the Government.
The matter of our increasing food import bill has been an issue of concern for many Jamaicans as it strikes at our ability to feed ourselves as a nation. What is even more worrying for me, however, is the widening gap between our food imports and exports.
Over the 2017 to 2018 period, while food imports increased from US$836.5 million to US$902.4 million, or by 7.9 per cent, our food exports declined from US$228.1 million to US$217.5 million, or 4.6 per cent, causing an increase in the deficit by US$65.9 million.
The decline in our exports is far more ominous then the rise in the food import bill. The fall-out in our traditional exports between 2017 and 2018 (by 21.6 per cent) and sugar (by 54.3 per cent) is cause for great concern. We earned approximately US$16 million from sugar in 2018, compared with over US$100 million on average per annum before divestment 10 years ago.
While trade liberalisation is largely responsible for this sharp decline, in respect of bananas and sugar, we have not taken sufficient actions to replace or otherwise diversify our agricultural exports, even when there is such great potential in non-traditional exports. Properly repurposed for exports significant wealth can be created in the sector, which can also support our tourism and manufacturing sectors.
The fundamental problem dogging our agricultural sector is the predominance of small players (over 200,000) and our small-sized farms (less than one acre on average). This reality has restricted the sector to a marginal existence. The majority of our farmers are marginal, producing enough for their household and selling the surplus.
This model of production is not conducive for increasing productivity and consistency in supplying any market. This, of course, is not to bash our small farmers. Indeed, when their production is aggregated, collectively, they have been able to supply us with the vegetables, fruits, tubers and starches, condiments and spices we need to survive. If, however, we want to see a qualitative difference and make that quantum leap, we have to change the model to focus on exports, supplying the tourism sector and providing manufacturing with sufficient raw material.
Jamaica is a small market of 2.7 million consumers. For many crops, any expansion of production cannot be absorbed locally. We make much to-do about our unique and advantageous geographic location at the centre of the Western Hemisphere and how we can build an international logistics centre around this.
Have we ever considered that those huge ships taking all kinds of goods here for transhipment will need something to take back? Despite our small size, Jamaica can be competitive in the growing of a wide variety of vegetables – under greenhouse, hydroponics, and other protected agriculture techniques, for winter demand in North America, Europe, and Asia. These protected agriculture technologies – significantly reduce the competitiveness gap between us and larger countries in relation to open field agriculture.
Mr Azan’s venture in Bernard Lodge, as conceptualised and sold to us, would be ideal for jump-starting this exciting area of intensive export-oriented agriculture. Edward Seaga got the concept right with Spring Plains in the early 1980s even if the implementation was disastrous. Currently, North America, Europe, and Asia are accessing their vegetables from as far south as Chile. We must use our ideal location to our advantage.
I venture to say without much fear of contradiction that Jamaican fruits are among the best tasting in the world. We have never sought, in a deliberate way, to maximise our advantage in this area. Most of our fruits are grown in backyards, planted more than 30 years ago. It is only within the framework of orchards that we can lift our productivity, and hence, our competitiveness.
The market for Jamaican fruits abroad, especially mangoes, ackee, and papayas, is far from being exploited. Although we earned US$15.7 million from ackee exports in 2018, one would be hard-pressed to find even 100 acres of ackee orchards in Jamaica!
Supermarket chains in Britain such as ASDA, Sainsbury, etc., have repeatedly indicated to Ministry of Agriculture’s personnel at trade shows their desire to carry Jamaican papayas on an exclusive basis. We cannot take on this challenge on the basis of collecting one or two boxes of fruit from random farms scattered all over Jamaica. The development of orchards would support both export of fresh fruits – as well as the manufacturing of juices, nectars, jams, and jellies – for both import replacement and exports. In this scenario, A-grade fruits would go to the fresh market, with lower grades going into manufacturing.
The Government has been speaking about planting over one million trees. What is required is not a sporadic planting of trees here and there. That approach might have some value, but what is required to sustain exports and manufacturing is orchards. Fortuitously, Jamaica has pre-clearance into the US market for a number of these product, as well as market access into the EU. Also, the Government has a fairly robust food health and safety infrastructure, which is critical for the traceability required for exports.
With the demise of sugar in the St Catherine and Clarendon Plains, and with lands largely outfitted with irrigation infrastructure, as a matter of urgency, the country needs to roll out a massive orchard development programme.
Private-sector investment will be critical to all of this, not only on the production side, but to provide facilities for collection, hot water treatment (where required, as in the case of mangoes destined for the US market), sorting, grading, and shipping. Haiti and India are moving tonnes of mangoes to the US and the UK, respectively. We certainly can do it. We already export a good quantity of papayas and ackee. We need to expand these.
COCOA AND COCONUTS
In tandem with expansion of exports for the non-traditional crops of papayas, mangoes, and ackee, we need to revive two of our critical traditional export crops – cocoa and coconuts – which, though on the decline, have tremendous potential for a comeback even bigger than before. Both crops have had challenges with diseases over time. However, disease-resistant varieties exist, and we must employ rapid multiplication techniques to get enough clean planting material to expand these two sectors.
The International Cocoa Organization has indicated that cocoa is one of the few crops where world supply significantly lags demand. The coconut industry worldwide values over US$30 billion. This industry continues to grow as more and more people are rediscovering the health benefits of coconuts.
As we focus on the redevelopment of coconut and cocoa sectors, we must focus on orchards and move the industry up the value chain. What inherent advantage in processing cocoa does Belgium have over Jamaica or Thailand over Jamaica in making coconut powder?
This analysis does not even touch on the world of nutraceuticals, herbs, and spices, which, in and of themselves, have tremendous export potential.
And, of course, there is the fledging cannabis industry being inhibited by unfavourable US federal banking regulations.
In my second article in the series ‘Deciphering the Food Import Bill’, I made the strong case for the development and exploitation of the blue economy, primarily for exports.
The point is, it is exports that generate wealth for nations, particularly small economies like ours with limited internal markets. The Government, therefore, must take another look at agriculture, with a view to reorienting it for export production and to support a strong manufacturing and tourism sector.
My next article will look at critical prerequisites to make this revolution happen.
- Donovan Stanberry, PhD, CD, JP, campus registrar, University of the West Indies, Mona, and a former permanent secretary in the agriculture ministry. Email feedback to firstname.lastname@example.org