Farmers aim to test a different type of market where money grows:
THE NATIONAL group representing farmers has developed a commercial plan that requires capital to execute, and is weighing a possible bond placement to raise half-billion dollars.
The Jamaica Agricultural Society, JAS, headed by President Norman Grant, says it’s in a position to tap the market, having quadrupled its profit last year while further lowering its debts.
The society has also reduced off-balance sheet debt, or contingent liabilities, from $39 million to $30 million last year. The debt is coming from a high of $200 million within the last decade.
“When I took office in 2003, there were 12 years of unaudited financial statements – a position that has now being corrected by the JAS producing audited financial statement within five months of the accounting year end. This we have done over the last 14 years ... ,” said Grant.
“This, for me, is a major achievement and as a chartered accountant as well, it makes me very proud,” he added.
The $500-million targeted for fundraising would be spent on asset development, a central marketing system and farm store operation under the Jamaica Agricultural Society Commercial Enterprises Limited, JASCEL, a central marketing platform for
farmers.
Involving the public
But Grant indicated that the JAS board has not yet had its final say on whether to go after the funding. He also indicated that members of the society would be given a chance to weigh in at the society’s next annual general meeting, scheduled for July 11. “The board of the JAS and the membership, through the AGM, will have to take a decision in light of the current strategic review,” he said.
Last year, the society disclosed plans for a multilevel car park in downtown Kingston and new shops for rental in Westmoreland and Mandeville. Land acquisition in Portland is under consideration for the current year, Grant said.
The money raised, he said, would allow the JAS to improve services to farmers.
Those services, in addition to marketing support, include an overseas farm work employment programme, tree planting, seed distribution, training sessions and entrepreneurial support, which provides selected participants with resources to plant crops or raise livestock.
In the annual report released ahead of the AGM – in which the plans for the $500m bond is mentioned – JAS reported a jump in comprehensive income from $7 million to $30 million at year ending March 2018. Revenue rose from $104 million to $184 million.
The largest contributor to revenue for the society is its annual Denbigh Agricultural Industrial and Food Show, followed by rentals.
Grant said Denbigh attracted 80,000 patrons, and grossed $75 million in 2017. The inflows have risen sevenfold relative to 2003, when the show grossed $10 million.
At the same time that JAS has been shedding debt, the value of the society has been increasing. Its net value is now $529 million, up from $489 million at March 2017.
“We were successful in restructuring and settling debts and regaining titles for a number of our properties, including the 52 acres of land at Denbigh showground which had a $84-million debt with FINSAC – now settled by us – and the property is now under development,” said the JAS president.
“Compton House, which had a debt of $16 million, is now settled and the property is under development and being rented. JAS properties in Westmoreland are being developed and new acquisitions of properties in Portland are being negotiated for the farmers of Portland,” he added.
The network of farmers represented by the JAS has grown to 200,000, more than half of whom are pig farmers. In a breakout of the numbers, Grant said the membership includes 102,000 pig farmers; 4,000 sheep and goat producers; 3,000 farmers from the network of rural women; 2,000 citrus growers; 2,000 coconut growers; 3,000 farmers aligned with the All-Island Banana Growers Association and 2,000 cocoa farmers.