Western stakeholders mull dairy rivival

Some key stakeholders in western Jamaica are hoping for a resurgence of the region's traditional dairy-farming communities in light of the new Drink Real Milk Campaign, which is being led by the Jamaica Dairy Development Board (JDDB) and its private-sector partners to boost local milk production and consumption.

Gloria Henry, president of the Montego Bay Chamber of Commerce and Industry, told Western Focus that the initiators of the campaign could also look to the west, particularly to St James, where the Montpelier Farms' dairy processing plant is located. Caribbean Broilers, Nutramix, and the St Thomas-based Serge Island Dairies are part of the campaign.

"I am one of those persons who believe that we should look at improving traditional agriculture and production and move towards more import substitution, so I'm pleased they have taken on that initiative," said Henry. "We should be forward-thinking in reviving the dairy production, not just for the primary production of milk, but certainly for secondary production agro-processing, milk products to support the tourism industry restaurants and even towards exports as well - because we need every bit of foreign exchange we can get into this country to stabilise our exchange rate.

"As it relates to the Montpelier property, I am one of those persons who believe that Montpelier should be kept for farming and no other purpose no housing, no commercial activity. It has the best microclimate conditions; it is relatively flat; it has all of the conditions that are suitable for agriculture. A lot of those lands were subdivided and sold to persons in 10-acre and five-acre plots, and many are not (currently) being used for dairy production," added Henry.

KEYSUBSECTOR

Before the mid-1980s, dairy farming was a key subsector of the agriculture industry in western Jamaica. Other traditional dairy communities include Shettlewood, Haughton Grove, Chester Castle, among other areas in Hanover, which all supplied the Montpelier Plant with milk.

In a joint paper titled, "Revitalisation of the Jamaican Dairy Sector: Evaluation of the Feasibility of Business Models for Intensive Dairy Production," the Jamaica Dairy Development Board and the Beef and Dairy Producers' Association of Jamaica noted that the annual output of milk has declined by approximately 63 per cent since trade liberalisation in 1992.

"The primary factor conditioning this decline was the inability of the local industry to compete with imports of dairy products (principally powdered milk), which enjoyed massive producer and export subsidies at origin," the publication states.

The authors say that the dumped milk substitutes were retailed at prices as low as 45 per cent below the price of locally produced fresh milk.

They also surmise that new dairy farms "below 440 cows are likely to be considered risky for financing at current rates of interest" and suggest the promotion of small-farm dairy development "through communal systems such as joint-stock ownership, which confer economies of scale".

RELATEDRISKS

Daniel Grizzle, vice-president of the Negril Chamber of Commerce, said that the related risks involved in dairy farming could be mitigated through special governmental low-interest loans accessible by dairy farmers.

"Because establishing a dairy farm is an expensive venture, there would have to be a loan available that makes sense maybe a five per cent (interest rate) over a 10-year period. The Government cannot lose because if you have someone for example, working on the farm and earning $10,000 per week, 90 per cent of what he spends attracts General Consumption Tax, so the Government will gain 16 per cent of that money. So it really keeps the local economy going," Grizzle said.

Grizzle's suggestions were similar to those made by the Dairy Committee of the Jamaica Lifestock Association (JLA), which, in 2009, while expressing concern about the decline in the number of dairy farms and associated milk production, said the high capital outlay required to establish dairy farms presents a barrier to new investors.

Jamaica's National Sustainable development Plan, Vision 2030 also addresses the problems being faced by the sector, among them, "progressive rounds of trade liberalisation over the past two decades", heavy reliance on imports; predial larceny; an ageing workforce; difficulties in titling and transfer of lands; and the loss of agricultural lands to urban settlement and housing.