More financial management, less guess work for Nevis farmers
CHARLESTOWN, Nevis, Thursday July 19, 2012 – Farmers on the island of Nevis are being encouraged to take a more business-like approach to how they calculate their costs and plan out their crop schedules.
This message was sent by the Permanent Secretary in the Ministry of Agriculture on Nevis, Dr Kelvin Daly, as he recently addressed a two day Agri-business Workshop sponsored by the Caribbean Agricultural Research and Development Institute (CARDI) in collaboration with the Department of Agriculture.
Dr Daly, himself a farmer, admitted that both the Ministry and Department Agriculture were struggling to develop a business attitude among farmers on the island.
“When I started farming in 1992, just like everybody here, the prices that we charged were inherited, there was no Math associated with costing. I simply asked what was the going price for X, Y or Z and that was the price. So I followed in the same footsteps perhaps you have followed, in arriving at a price for the sale of your products and in trying to understand your overheads,” he said.
Daly contended that clearly there was something missing from discussions held over the years which concerned costing, agri-business and bookkeeping and believed it to be a hidden factor he referred to as Factor X, which had to consider the economies of scale.
He said the high cost of production on Nevis and the high cost of food was an issue that was always discussed. However, if one discussed them side by side with imported items, it was probably true given the fact that Nevis imported food from places with large tracks of land and thousands of hectares under production. As a result the Economies of Scale would dictate that they could charge less per unit.
“We in the smaller countries in the Caribbean, we have no such expanses of land but yet we are forced to compete on a global market with smaller land spaces, higher cost of production and therefore, we must be careful when we start to calculate what the cost to purchase a crop is.
“We simply cannot look at only the cost of inputs, there is a hidden factor in there that we must contemplate and discuss because then it gives a bit of benefit to the farmers, the producers, agro processors the horticulturists that says because we are small, you must build in a factor in it for being small. It might seem common sense to do that but it is not so common because we have not done it yet after all these years of discussion. That is why farmers are resisting any discussion about bookkeeping, any discussion about costing because,” he said.
Director of Agriculture on Nevis Keithley Amory, in his remarks welcomed stated that agriculture officials had come to the realisation that many farmers lacked an integral part of agricultural training in basic record keeping skills; in addition financial institutions had began requesting business plans from farmers who sought financial assistance, which were reasons for the department holding the workshops.
“Quite recently banks are asking for business plans. Many times when farmers go to ask for loans, even for small loans, they are asking ‘do you have a business plan?’ and they are sending farmers back to the Agriculture Department to help them develop those business plans.
“So I for one welcome this course that CARDI has put on. I do hope that you lend a very close ear to the facilitator and really learn and ask questions really be proactive in asking those questions because to me this agri-business course will help you with your small enterprises. It does not matter if you are doing it just for your home use because in that way you would still be able to know how much money that has been expended on whatever you are doing at home or as a business,” he said.