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Grenada Association of poultry producers calls for government intervention

GAPP President Jason Phillip wants a stay in the current pricing until a review can be done

The Grenada Association of Poultry Producers (GAPP) has called for government’s intervention and the enactment of a national poultry policy in response to the sudden hike in the price of flour and animal feed by Caribbean Agro Industries Ltd which has a monopoly on the island.

In a letter dated, January 29, Caribbean Agro, a subsidiary of the United States-based international conglomerate, Archer-Daniels-Midland Co. (ADM) informed the Ministry of Trade that effective February 3, 2021, there will be increases in the prices of Baking and Counter flour, as well as poultry and hog feed among others.

The company said that developments occurring on the international grain market are “having a profound negative impact on the cost of sourcing key ingredients for manufacturing flour and animal feed.”

The letter said in part: “These adverse conditions (have) left us with no choice but to pass on some of these cost increases to the consumer and therefore, effective February 3, 2021, prices of flour and animal feed will be revised…”

Speaking at a press conference on Monday, GAPP President Jason Phillip, called for a “stay in the current pricing until a review can be done” involving government and stakeholders.

He pointed to a January 29, 2021 article on “, headlined ‘China’s hunger for US crops drives ADM earnings to record.”, which notes that China is scooping up U.S. crops, pushing combined American corn and soybean exports to a record in the fourth quarter based on data from the U.S. Department of Agriculture.

“So, the company that is now complaining that the prices of the supplies are getting high, is the same company that is actually selling the product to China and making big bucks. So you want to eat your cake and have it,” said the aggrieved GAPP President.

Against this backdrop, he called for government’s intervention to help the fledgling poultry farmers on the island.

Phillip said: “We need to protect our small emerging farms and as an industry where much development has recently started, where locals are investing their life savings (and) their reputations into building an industry that we believe can serve us well into the next hundred years, we are not being supported in the way that can ensure our success.

“…We are now demanding that we get that support so that we can make this whole industry live and survive and this is where our leaders need to step up and we need to see affirmative action,” he added.

According to the GAPP President, the last price increase from ADM was in 2019 during a time when commodities were not necessarily high and was relatively stable.

Phillip noted that “ADM has consistently made profits from 2009 to 2020” in its local operation and that “even during the last global recession the company was operating very strongly.

He said while “we salute the company as it is being managed well,” the question is “to what effect does it mean to small emerging economies like Grenada.”

According to Phillip, about “60 percent of farmers” in Grenada are “subsistent farmers, who use their daily income as a means of sending their children to school, putting food on the table and doing their daily routines.”

He said the responses from farmers to the price hikes have been one of total desperation and complete panic,” adding that “an increase in the cost of feeds at this time will significantly affect the farmers’ ability to conduct business.”

“Poultry, as we all know has been going through some very trying times from the beginning of the COVID-19 pandemic period when we saw a shutdown, the same ADM Caribbean Agro mill being closed for a period of time and as an Association, we have had to rally, we had to work quite diligently just to survive the past 12 months.

“…We are now hit suddenly with a significant increase in cost of operating and let us be clear that in the poultry business approximately 60 to 70 per cent of our cost comes through feed. That is a significant factor so any increases in feeds especially as urgent as this, it significantly affects our ability to do business.

“With the suddenness of this information being sent to us…it now means that our farmers do not even have the opportunity to sit down with their vendors, the companies that they supply to even renegotiate pricing on the basis of this.

“It means now that with an immediate effect stocks which farmers currently have in hand you will have to still dispose at the previous rate and you do not even have an opportunity to recoup some of the cost involved. This is a situation that we cannot sit by and allow to happen – we cannot sit idly by or be quiet, we have to voice our concerns.

According to Phillip, in the past 12 months poultry farmers “have not received any form of assistance or revenue that comes outside of the sales that they make” and that the business done by our farmers “have dropped significantly though farmers continue to ply their trade – they are doing so under much stress and duress”.

“This is our reality,” he said, adding that “we cannot access feeds at a reasonable rate in any other territory”.

“We are caught between a rock and a very hard place and the only alternative we have is that …. It’s time (for the government) to take the fight from the farmers to the company.”

“We are now directly calling upon our leadership (in GAPP ) to step up…we do not wish to have our farmers protesting in the streets…we do not wish to make this an international incident of sorts where farmers have to be crying out…,” he said.

“…We do not want the company gone. We want the conditions under which we are currently doing business to be adjusted. We wish for things to be fair and under these circumstances we are asking for the management and the ownership of Caribbean Agro Industries to have a heart and to review things that can make this a little bit easier,” he added.

Stating that “some level of urgency” is needed, Phillip said that “farmers have absorbed too many losses and called for the poultry policy which was presented to government in 2017 to be enacted so that “we can effectively move this industry forward.”

Phillip was accompanied at the press conference by the Senator for Agriculture in the Upper House of Parliament, Sen. Roderick St. Clair who disclosed that “feed and flour are price controlled items” and expressed doubts as to whether negotiations were held by CAI to determine the new prices.

Sen. St. Clair described the letter announcing the new hike in prices as “rude” and pointed to the fact that “a lot of persons are out of a job and a lot of businesses are on the verge of closing down” and that this development could have “far reaching effects” and can lead to “more persons looking to government (for) some form of support.”

He expressed the view that “the tone of the letter should be saying to the government that we have a situation so, we (the company) are saying look, we need to review some of these prices, so let us have a discussion with the stakeholders, our animal and livestock farmers, our bakery and some of the big entities…especially in this time of COVID, we know the implications of these prices.”

Citing need for the government to “look at the issue of animal feed and the arrangement and the agreement (it has) with Caribbean Agro,” Sen. St. Clair noted that the agreement “dates (back) some 55 years (and) that it seems to be an unlimited agreement” unlike the “GRENLEC agreement, which I think, had a time span to it.”

The farmer’s representative recalled that ADM was also supposed to be investing in the industry by setting up poultry farms.

“…That is not happening – what is happening is that we have what I would refer to as extraction,” he said, speaking to the challenges faced by farmers who are “at the bottom line of these industries.”

ADM imports wheat from the United States and mills it into flour for baking at CAI’s manufacturing plant in Mt. Gay, St. George’s.

The company sells bakery mix and also imports ingredients for animal feeds and sells processed formulas under the Wayne Feeds® and Homestead Feeds® brands.

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