Raphael John-Lall

Agri­cul­ture en­tre­pre­neur and lead con­sul­tant at Trop­i­cal Agri­cul­ture Con­sul­tan­cy Ser­vices, Riyadh Mo­hammed, be­lieves that if the Na­tion­al Agri­cul­tur­al Mar­ket­ing and De­vel­op­ment Cor­po­ra­tion (Namde­v­co) had im­ple­ment­ed its con­tro­ver­sial in­crease in ad­min­is­tra­tive fees at the farm­ers’ mar­ket in Ma­coya, it would have led to an in­crease in food prices.

In March, Namde­v­co, a statu­to­ry body un­der the Min­istry of Agri­cul­ture, Lands and Fish­eries, said it would sus­pend the pro­posed in­crease of fees at the Nor­ris De­onar­ine North­ern Whole­sale Mar­ket, Ma­coya.

An of­fi­cial state­ment from the com­pa­ny said the fees had been sus­pend­ed un­til fur­ther no­tice.

Be­fore the de­ci­sion to sus­pend the fee in­crease, Namde­v­co came un­der fire from dif­fer­ent stake­hold­ers, in­clud­ing farm­ers, politi­cians and NGOs for its plans to in­crease sev­er­al fees paid by farm­ers and ven­dors at the Whole­sale Mar­ket.

Among the fee in­creas­es pro­posed were:

• ↓Month­ly/Dai­ly Ven­dor Pass… From $20 to $40;

• ↓Week­ly Bar­row­men Fee… From $50 to $100; and

• ↓Ven­dor Re­place­ment Pass Fee… From $100 to $200

The de­fer­ment of the pro­posed fee in­crease came af­ter a call by Cou­va North MP Ravi Rati­ram for the en­ti­ty to re­scind its de­ci­sion.

He said the in­creased fees would have seen con­sumers faced with high­er food prices.

In an in­ter­view with the Busi­ness Guardian, Mo­hammed ex­plained why the in­creased fees would have im­pact­ed on food prices.

“Yes, I do be­lieve that any in­crease in ad­min­is­tra­tive fees, at this time, would have im­pact­ed the fi­nal price of food sold to con­sumers. Ser­vice providers must de­cide whether to pass on pric­ing in­creas­es or ab­sorb grow­ing costs.

“Some mer­chants (mid­dle­men/farm­ers) are re­luc­tant to pass on price in­creas­es, even when they make sense. The first in­stinc­tive re­sponse to grow­ing ex­pens­es is to raise pric­ing. Price hikes ought to be con­sid­ered a last re­sort, pur­sued on­ly af­ter all oth­er op­tions have been ex­haust­ed.

“To strength­en farm­ers’ ar­gu­ment against a price in­crease, they can al­so in­clude oth­er da­ta, such as up­grades to their ser­vice of­fer­ing or cap­i­tal ex­pen­di­ture they have made to en­hance cus­tomer sat­is­fac­tion.

“Adding ad­di­tion­al ser­vices or small, in­cre­men­tal en­hance­ments at the same time that prices are raised is one strat­e­gy to mit­i­gate the im­pact of price in­creas­es.”

He al­so said many stake­hold­ers did not re­spond pos­i­tive­ly to the pro­posed in­creas­es.

“While some viewed it as a busi­ness op­por­tu­ni­ty to in­crease rev­enue at a na­tion­al lev­el, sev­er­al ques­tions and com­ments were launched in heat­ed con­ver­sa­tions. Some of them were: first­ly, why fa­cil­i­tate food im­porters over lo­cal pro­duc­ers and traders, es­pe­cial­ly when mar­ket spaces and spots are lim­it­ed.

“Sec­ond­ly, if the cor­po­ra­tion is sup­posed to as­sist with mar­ket­ing and trad­ing of con­sum­able com­modi­ties, why bur­den the prime stake­hold­ers with ad­di­tion­al op­er­a­tional costs which would ul­ti­mate­ly be trans­ferred down to con­sumers.

“Third­ly, who gave the in­struc­tion to in­crease the prices when food se­cu­ri­ty is tout­ed to be a grow­ing con­cern for the na­tion?

“Fourth­ly, why are mar­ket spots so dif­fi­cult to at­tain? Fi­nal­ly, when will the fa­cil­i­ties be im­proved to in­crease stake­hold­er com­fort and im­prove lo­cal food trade?”

He added that Namde­v­co at­tempt­ed to in­crease prices with a good in­ten­tion to gen­er­ate more rev­enue, so that more in­vest­ment would be placed in im­prov­ing the mar­ket fa­cil­i­ties to in­crease lo­cal trade and to ex­pand on the good agri­cul­tur­al prac­tices (GAP) through more ad­vanced pro­grammes.

“The in­ten­tion to in­crease these prices should have been strate­gi­cal­ly planned to in­cor­po­rate fre­quent stake­hold­er con­sul­ta­tion and feed­back. In­cor­po­rat­ing mul­ti­ple per­spec­tives in­to de­ci­sion-mak­ing is en­hanced by stake­hold­er feed­back. Feed­back loops val­ue the opin­ions of stake­hold­ers and es­tab­lish trust, which pro­motes re­al in­volve­ment.

“In­put points out ar­eas where it can be dif­fi­cult to strike a bal­ance be­tween di­ver­gent stake­hold­er de­mands and con­tra­dic­to­ry or un­re­al­is­tic in­put.

“Un­der­stand­ing ex­ter­nal stake­hold­ers, such as agri­cul­tur­al in­put com­pa­nies (such as those that sell seeds and fer­tilis­er), agri­cul­tur­al re­tail­ers, farm­ers and ranch­ers, agri­cul­tur­al cred­it in­sti­tu­tions, crop con­sul­tants and ad­vi­sors, ag­gre­ga­tors, proces­sors, dis­trib­u­tors, trans­porta­tion and re­frig­er­a­tion com­pa­nies, and in­gre­di­ent man­u­fac­tur­ers, is fre­quent­ly nec­es­sary for en­gag­ing with the agri­cul­tur­al sup­ply chain.”

He al­so said that in this in­stance, the prime stake­hold­ers would be those who face the cus­tomers di­rect­ly.

“In every mar­ket, in­ter­me­di­aries (mid­dle­men) are sig­nif­i­cant par­tic­i­pants. Their ser­vices as­sist pro­duc­ers as well as con­sumers.

“Mid­dle­men not on­ly con­tin­u­ous­ly bal­ance sup­ply and de­mand in the mar­ket, but they al­so give pro­duc­ers in­sight­ful feed­back re­gard­ing what the mar­ket will bear.”

Mo­hammed said the set­ting of ad­min­is­tra­tive fees at the farm­ers’ mar­kets is just one as­pect of a com­plex chain in the food trade and of­fi­cials at Namde­v­co must take all fac­tors in­to con­sid­er­a­tion when mak­ing de­ci­sions.

“The process of or­gan­is­ing, prepar­ing, dis­trib­ut­ing, and ad­ver­tis­ing food so that it reach­es peo­ple ef­fi­cient­ly is known as food trade. It cov­ers the choice of in­gre­di­ents, prepa­ra­tion and pro­cess­ing of the food, pack­ag­ing, and de­liv­ery in ad­di­tion to mar­ket­ing and pro­mo­tion of the fin­ished prod­uct.

“Plan­ning for the food trade in­cludes de­ter­min­ing the de­mands of the mar­ket, study­ing con­sumers, and eval­u­at­ing com­peti­tors. Es­tab­lish­ing pric­ing tac­tics, de­ter­min­ing mar­ket­ing ob­jec­tives, and cre­at­ing a mar­ket­ing plan to pro­mote the of­fer are all cru­cial. Pro­duc­ing and prepar­ing food is a cru­cial step in the mar­ket­ing process.

“Food pro­duc­ers are re­spon­si­ble for guar­an­tee­ing food safe­ty and com­pli­ance with food laws and reg­u­la­tions. Be­fore it is dis­trib­uted, they al­so have to make sure the food is of the high­est cal­i­bre and in ex­cel­lent con­di­tion. Dis­tri­b­u­tion of food is yet an­oth­er cru­cial com­po­nent of trade.”

He spoke about what can be done to soft­en the blow of in­creased ad­min­is­tra­tive fees at Namde­v­co’s mar­kets in the fu­ture.

“I be­lieve that the rent could be in­creased grad­u­al­ly with ef­fec­tive com­mu­ni­ca­tion with the prime stake­hold­ers and show­ing an im­proved lev­el of ser­vice. In­creas­ing streams of rev­enue is al­ways a good strat­e­gy to rein­vest and grow our lo­cal trad­ing ca­pac­i­ty, but must be done with­out shock­ing the core play­ers of the food sup­ply chain.

“Rev­enue streams are ex­pand­ed by the di­ver­si­fi­ca­tion of farm prod­ucts, which in­cludes live­stock and dif­fer­ent crops. Tech­no­log­i­cal de­vel­op­ments can save ex­pens­es, in­crease pro­duc­tion, and sim­pli­fy farm op­er­a­tions.

“Dri­ving sales and rais­ing brand aware­ness re­quire ef­fec­tive of­fline and on­line mar­ket­ing tech­niques.

“The push should be to em­pow­er our lo­cal food pro­duc­ers and lo­cal sup­pli­ers to gen­er­ate more sales, so that when pro­posed price in­creas­es such as these take place, they will not be cri­tiqued so harsh­ly.”

Oth­er costs in­volved

Pres­i­dent of the Agri­cul­tur­al So­ci­ety of T&T (ASTT) Daryl Ram­per­sad in an in­ter­view with the Busi­ness Guardian said if Namde­v­co does in­crease the fees at the mar­kets, it would have not have a di­rect im­pact on food prices im­me­di­ate­ly how­ev­er it would neg­a­tive­ly im­pact farm­ers’ op­er­a­tional costs.

“Our agri­cul­tur­al mar­ket prices are based on sup­ply and de­mand. So that would not have a di­rect im­pact on food prices.

“But on the oth­er hand, dur­ing that two-week pe­ri­od I re­ceived nu­mer­ous phone calls from the farm­ing com­mu­ni­ty be­cause we could have ex­pect­ed an in­crease in fees as the cost of things are go­ing up, but not that huge pro­posed in­crease we saw.”

He said that farm­ers are faced with the ris­ing costs of do­ing busi­ness and a sig­nif­i­cant in­crease in the use of the Namde­v­co mar­ket would hurt farm­ers fi­nan­cial­ly.

“The farm­ers have to send their chil­dren to school. They have to pay light bills and wa­ter bills. In­creas­ing the fees at the mar­ket is sim­ply giv­ing farm­ers an ad­di­tion­al bill. We must have con­sid­er­a­tion for our food pro­duc­ers. They have enough is­sues with in­put costs, prae­di­al lar­ce­ny, avail­abil­i­ty of fi­nance and many years to get leas­es for land. This is about the ease of do­ing busi­ness for farm­ers.”

He al­so said that there are many is­sues at the Namde­v­co mar­ket in Ma­coya such as it not be­ing big enough to ac­com­mo­date farm­ers and man­age­ment should deal with those is­sues be­fore they in­crease fees.

While he ac­knowl­edged that Namde­v­co and the Min­istry of Agri­cul­ture con­tin­ue to hold stake­hold­er dis­cus­sions with the ASTT and farm­ers in gen­er­al, he hopes that when Namde­v­co is­sues an­oth­er pro­posed in­crease in fees, it would be in keep­ing with the re­al­i­ties of the busi­ness en­vi­ron­ment farm­ers op­er­ate in.

“There was no for­mal jus­ti­fi­ca­tion for that fee in­crease last month. There was no ex­pan­sion or im­prove­ment in the fa­cil­i­ties.

“I hope Namde­v­co takes in­to con­sid­er­a­tion the re­sponse of John Pub­lic to the fee in­crease last month when they make their next de­ci­sion to raise fees. Farm­ers have to pay to sell the pro­duce and the buy­ers al­so pay when they en­ter the mar­ket too.”