Govt recommits to industry after cocoa company pulls out

KINGSTOWN – The government says it will plan the way forward for the cocoa industry after owners of the St Vincent Cocoa Company announced their decision to cease operations last week.

Cocoa pod and beans.

According to Prime Minister Dr Ralph Gonsalves, Minister of Agriculture Saboto Caesar was slated to meet with the firm on Monday.

The company began operating here in August 2011 after signing a 50-year agreement with the Gonsalves government.

“. . . It is clear that they probably feel that the amount of money to be made . . . they probably feel that enough farmers haven’t come forward to plant cocoa; but the state will keep with the cacao industry,” Gonsalves told CMC.

The agreement, which qualified for review after 20 years, gave Amajaro exclusivity in St Vincent and the Grenadines to buy cocoa beans, in wet and dry form, and to perform all sales and marketing of cocoa within the period of the agreement.

It, however, made exception for cottage industry persons selling cocoa for consumption in the country.

“They haven’t spoken in any detail about the reasons,” Gonsalves said when asked what reasons the company gave for pulling out of St Vincent.

“I think the general statement has been the new owners not seeing the light for a few years,” he said.

Bloomberg, a premier site for business and financial market news, reported in November, 2013, that Armajaro Holdings Ltd had agreed to sell its soft commodities trading unit to Ecom Agro industrial Corp., the world’s second biggest coffee and third largest cocoa trader.

The company’s trading arm Armajaro Trading Ltd reported a loss of US$7.6 million (BDS$15.2 million) in the year ended September 2012, Bloomberg reported.

Gonsalves said after the meeting, Caesar was expected “to be in a better place to find out the precise way in going forward in light of the memorandum of understanding that we had.”

He said the Cocoa Company would leave is assets and infrastructure for the government for “continuation of the process”.

“We are interested in continuing the process. A company came in, if they decide for their own commercial reasons to pull out, it doesn’t mean that there is not a space for cocoa,” Gonsalves said.

Asked if the company had to give notice before ceasing operations, Gonsalves, who along with former Minister of Agriculture, Montgomery Daniel, signed the agreement, said “I think they had to give a period of notice, but I think all those things Saboto will discuss with them.”

He said the government would see what could be traded off in lieu of notice.

“If somebody gives notice and really does nothing, whatever is there many not be worthwhile taking over after the notice period. So, if we going to have a break in a manner which is beneficial — those are practical things and Saboto and his team will talk to them.

“But we will continue with the cocoa industry and we will put machinery in place. The ministry had already spoken about having a cocoa and spice, condiments unit. This is an excellent opportunity to ground that in something going forward,” Gonsalves said.

“And who knows? Ecom may well purchase our cacao. We had a help from them [Amajaro] in the restarting of the industry and we can build on it going forward.

“And I don’t see that it should be closed as an option for our farmers . . . . We are accustomed as a people to make adaptations; so I don worry about these things. We move forward how we can, in the best possible way,” Gonsalves told CMC.

(Da Vibes)


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