Black Gold - Jamaica's Treasure Ignored

I briefly glimpsed a bit of a news clip late last week which was mentioning that cofee was the next biggest item traded on the market behind oil....huh? what? I didn't get to see the entire news piece but that stuck in my head. As a coffee lover and knowing what I shell out for a cup especially in the US I wondered to myself Isn't our Blue Mountain Coffee world famous or renowned or something?




I pushed it to the back of my head.....

This morning the headline in the Gleaner of the govt shelling out J$22M to consultants to tell us how to create off-shore banking or some other crap along with the J$22B contract Ashtrom won and then finally the fact that we were again suffered another rating downgrade this time by Fitch brought this back to mind.

Why is it we don't invest in the things we do best? That for lack of a better term come "naturally" to us? One of them being coffee farming? Instead we shell out millions and billions of investments that never come to light, end up falling apart within a matter of years or offer no ROI.

This Black Gold we have on our hands is no joke.....Coffee is an $80 BILLION Industry. The US has an $18B coffee market of which specialty coffee sales are increasing by 20% per year and account for nearly 8% of the market.

With the US being the closest of mass coffee consumers nearest to us let's look at their consumption trends:

• COFFEE STATISTICS: show that among coffee drinkers the average consumption in the United States is 3.1 cups of coffee per day.
• COFFEE STATISTICS: 50% of the population, equivalent to 150 million Americans, drink espresso, cappuccino, latte, or iced/cold coffees.
• COFFEE SHOP FACTS: Independent coffee shops equal $12 billion in annual sales.
• COFFEE SHOP FACTS: At the present time there are approximately 24,000 Coffee Shops across the country. Statistics show there will be approximately 50,000+ Coffee Shops by the year 2010.
• COFFEE SHOP FACTS: The average Espresso Drive-thru Business sells approximately 200-300 Cups of Espresso and Coffee Based Drinks per day.

According to the National Coffee Association & Speciality Coffeee Assoc of America in their latest research over 50% of Americans over 18 years of age drink coffee every day.

When you break down their data that means:

The 50% represents over 150 million daily drinkers. If that is not a staggering number their reserach also shows that 30 million of American adults drink specialty coffee beverages daily; which include a mocha, latte, espresso, café mocha, cappuccino, frozen/iced coffee beverages, etc.

So blah blah blah Tara! WTH does this matter that's America not Jamaica.....True but as I mentioned above behind OIL it (Coffee) is the 2nd largest IMPORT in the United States. Yes that is correct....and guess what if they're importing it that means they aint growin' it or enough of it to meet their market demands

Just so you know-->>Coffee is the most widely served beverage.....it's available any and every where

Wondering where they get their coffee from? I was too so I did some checking and this is what I found:

Columbia commands the biggest piece of the $4 Billion coffee import pie with 20.7% and Brazil not far behind with 17.1% -- you may be wondering if Jamaica is in there anywhere....yes indeed we are however we're less than .4% falling behind Yemen, Canada & France.

I have to buss out a big rahtid laugh....Yemen....Canada.....France? Can you imagine? Even Papua New Guinea mashing us up commanding 1% of the US import market.

See for yourself:

http://www.nationmaster.com/red/pie/eco_tra_wit_us_us_imp_of_gre_cof-trade-us-imports-green-coffee#definition

What's the Big Deal you may say? the big deal is that our Blue Mountain Coffee is a friggin big deal....it's rated/ranked as some of the BEST coffee in the World. Yes Blue Mountain may be a bit more on the pricey side but we also produce High Mountain coffee.

Did I mention that production wise we produce more coffee than Papua New Guinea, Kenya & Vietnam but all of those countries have higher import #'s from the US.

Isn't that crazy???? Well u aint seen crazy yet because in September of this year (2009) the Coffee Industry Board sent out a release stating that Jamaica's multi-billion dollar coffee industry had become the latest sector to be hit hard by the prolonged global economic crisis....in fact they were scrambling to find monies locally to purchase cherry coffee which is critical to maintain their world class quality. Yep.....maybe I didn't mention a key piece of info:

Jamaica currently earns up US$30 million or more than J$2 billion annually from coffee exports.

So why aren't we investing in making this into a $10 Billion or let's start small even a $5 Billion earner for our country? Why aren't we spending this surplus of cash we've seem to have found to "spruce up" the country, build private airports, buy chairs and houses for our government or even employing Chris Zacca at 5.7M (part time) to provide high-level advice and support to the prime minister on the development and implementation of policies, strategies and key initiatives designed to support the achievement of national socio-economic objectives (phew that's a mouthful). Couldn't we take even a wee bit of that to turn a US$30M earner into a US$50M earner? Maybe Zacca could look into this as a "key initiative" anyone have his #?

There are so many opportunities and now with the whole going green there's an increase in demand for Organic Coffee not to mention the by-products of coffee (husks, skins & substitutes containing coffee). So with this push by Minister Tufton to re-engage persons in framing & agriculture why not coffee farming? why not look at the multitude of opportunities that could come from this....including job opportunities.

Brazil employs over 5 million people because of the coffee trade; most of those are involved with the cultivation and harvesting of more than 3 billion coffee plants.

They see the coffee industry an investment and maybe that's why they command 17.1% of the US import Market.

Mind you we haven't even touched on the demand for Coffee & RTD (read to drink) Coffee Beverages abroad....especially in Asia (Japan & China).

Speaking of which I had simply shared a few facts/stats in relation to the USA I had not even touched on Asia - Japan especially and it's affinity to Jamaica, Coffee & Reggae - come the hell on - is that not a Golden Goose waiting to lay an egg or what?? Japan is ranked the 3rd in the world for coffee consumption.

Here are a few interesting facts in relation to coffee internationally:

1. Coffee shops make up the FASTEST GROWING part of the restaurant business, checking in with a 7% annual growth rate!
2. World coffee production is estimated at 110 - 120 million bags per year!
3. 14 billion espresso coffees are consumed each year in Italy, reaching over 200,000 coffee bars, and still growing!
4. Americans consume 400 million cups of coffee per day, or equivalent to 146,000,000,000 (146 Billion) cups of coffee per year; making the United States the LEADING CONSUMER of coffee in the world.
5. Japan ranks number 3 in the world for coffee consumption.
6. Coffee represents 75% of all the caffeine consumed in the United States.
7. Café Bars average sales of 230 cups a day.

Sounds like an opportunity doesn't it? We already have the basic foundation (climate/soil/knowledge) all it takes is for the government to recognise the possibilities and make an investment on what is sure to be an ever-growing market

Guess all I can do is hope they'll plant this bean & the country can benefit from it's growth....

Ripped from the Headlines - If You Never Go How Will You Know?

I woke up this morning thinking "Ok Tara...what will you blog on next?" Immediately I thought I'd blog about the whole man/woman relationship thing or another frustrating thing for me the ever increasing cost of electricity and why we live on an island & but we're not encouraged to use solar energy.....but I began to read The Gleaner online and voila....there it was 2 seperate articles that related to Tourism or the lack thereof.

Though I could be wrong I think it's safe to say that with the "loss" of bauxite, agriculture (sugar etc) and all other revenue drivers that Tourism is Jamaica's main source/contribute to foreign income (let's not talk about remittances). With an economy in shreds and the probability that the planting of yams, escallion and oranges or any other industry start-up would bear "immediate fruit" you would think the government would throw all they had behind Tourism.

I'm no expert by any means but logic would dictate that after welcoming the Spanish hoteliers w/open arms and erecting monstrocity after monostrocity along our shorelines and pumping obscene amounts of money into expanding our airports. We would then need to increase the traffic through our airports and fill these beds with bodies....at least on a fairly regular basis. That's if we had planned earning any revenue from these "investments."

With this in mind how do you get the people here? Glossy ads? Flashy commercials? Tourism trade shows? e-banners on travel websites?

Hmmmmm....all sound like good ideas but we're in a competitive market. Plenty of other islands have gorgeous beaches and salty blue water...and yes...reggae. Live bands strumming Bob Marley tunes for days. That combined w/less crime, minimal harassment, sweet island charm & the offer of new/exciting things to do on their islands what makes Jamaica stand out other than the name?

With cost-conscious shoppers on the rise and our proximity to the US you would think that the powers that be would see them and US tourism as "low hanging fruit?" So why look to appeal to them and at the same time look to markets that had historically low/flat passenger numbers that have since experienced steady and consistent growth over the last few years and find out WHY? HOW?

Crazy thought huh? I know.....

Guess what's even crazier? The data already exists and is accessible through IATA/EU & even the World Bank did a study on Caribbean Aviation in 2006 and provided the same information to our government that I am about to share with you:

FROM WORLD BANK STUDY (2006):

“The Caribbean region has an abnormally high density of international airports... the consequence is that the volume of services is low… most Caribbean airports have lower traffic volumes than the smallest US airports which are served by low cost carriers”.

FROM IATA ECONOMIC IMPACT STUDY (2006)

350% growth in the South Pacific Islands, 300% growth the Far Eastern Pacific Islands, 230% growth in EU - “Low cost carriers have vastly expanded passenger numbers on routes with historically low and steady base figures”

Notice the common denominator? Low cost carriers (LCC) or Low Fares Airline (LFA)- yep the only entities that continue to fill up and generate more passengers during an economic crunch. We're the only region that hasn't taken advantage of that and we're the only reagion with stagnated travel growth.

Let me give you a few facts:

FACT: “Low cost carriers have vastly expanded passenger numbers on routes with historically low and steady base figures”.
FACT: US carrier’s fares to Caribbean destinations were US$71 to US$155 higher compared to similar domestic US routes.
FACT: Between 2004 and 2008 the only airlines to add new increases in capacity in the Caribbean were US low cost airlines.
FACT: We have approx 10,000 NEW beds in Jamaica to fill and 30,000 beds overall
FACT: Govt says we're going for a 70% occupancy rate (we hover around 67%)
FACT: Newly expanded airports only have about 1/2 of total capacity passing through them
FACT: Dublin Airports passenger traffic was 23.3M in 2007 in 2006 it was 21.1M and only a little over 10yrs before it was 5M.
FACT: Dublin's airport traffic has grown EVERY year w/an compund growth of 9.7% over the last 12yrs

So let's do some math:

10,000 new hotel beds @ 70% occupancy with avg stay of 7 nights per visitor = requirement for 437,500 tourists.

Each tourist needs 2 flights (return trip) = 875,000 seats
Airlines operate @ 70% LF (load factor) = therefore we would need 1.25m seats/yr

This requirement for 1.25m seats is just to fill the NEW beds built or being built in 2009/2010.

Staggering isn't it? So this begs the question: Where are we gonna get these seats/passengers? From paying American Airlines or code sharing with Virgin? Or maybe by continuing to cut routes and provide delayed/below standard service on our failing national carrier?

WAKE UP JAMAICA!!!!!

Here's what has transpired in JA in relation to Tourism since 2009

Minister of Tourism annouces the Govt's "Drive for Five" campaign - yep 5M visitors by 2012

http://www.jis.gov.jm/parliament/html/20080516T100000-0500_15202_JIS_GOV_T_TO_EMBARK_ON__DRIVE_FOR_FIVE__TOURISM_CAMPAIGN.asp

Minister of Tourism strikes a US$4.5M dollars with American Airlines to bring passengers to Jamaica - yep AA & yep US$4.5M

http://www.jamaicaobserver.com/news/html/20080905T230000-0500_139879_OBS_MINISTER_DEFENDS_DEAL_WITH_AMERICAN_AIRLINES.asp

Oh then guess what happens AA cuts costs & guess what that means JA will have to pay them becuase they aren't filling their seats at 75% load factor to JA

http://jamaica-gleaner.com/gleaner/20090311/lead/lead4.html#

Air Jamaica "divestment" delayed again and again and again - yep shocker delayed AGAIN even w/a genius seconded from Grace to oversee this

http://www.jamaica-gleaner.com/gleaner/20090322/lead/lead2.html##

Some insight into why divesment may be delayed - yep Sabotage from the inside

http://www.jamaicaobserver.com/news/html/20090919T200000-0500_160038_OBS_SABOTAGE.asp#

Our failing national airline's chairperson orders a flight on the runway to turn back - yep turn back to pick up a passenger

http://www.jamaicaobserver.com/columns/html/20080621T000000-0500_136963_OBS_SHOULD_AIR_JAMAICA_BOSS_SHIRLEY_WILLIAMS_BE_FIRED__I_SAY_YES.asp

Govt appoints the John Lynch as Chariman of JTB & Director of Tourism - yep both roles (can we say conflict of interest?) & the ENTIRE JTB Board quits

http://www.jamaica-gleaner.com/gleaner/20081118/lead/lead1.html

Sandals Hotels lays off 650 staff - yep 650 people made "redundant" 285 between MoBay, Ochi & Negril

http://www.jamaica-gleaner.com/gleaner/20081213/lead/lead1.html

SuperClubs goes on a "hiring freeze" & begins rotation of staff - yep this is what they have to do in order not to layoff staff

http://www.jamaicaobserver.com/news/html/20081212T190000-0500_143686_OBS_FINANCIAL_CRUNCH_HITS_TOURISM.asp


One of the Mega hotels IberioStar closes its doors in Montego Bay sending home some 300+ staff -yep just opened & just closed...no one to fill the beds

http://www.jamaica-gleaner.com/gleaner/20090828/lead/lead1.html

The PM announces in his budget speech that he's formalising casino gambling - yep another great way to generate revenue according to Golding

http://www.jamaica-gleaner.com/gleaner/20090925/news/news4.html and then Harmony Cove suddenly jumps up and announces they'll add 6,000 more rooms at US$7B (but guess what they won't start until casino's are apprvd) http://www.jamaica-gleaner.com/gleaner/20081212/lead/lead2.html


We've approved a $300 Million to finance an "international airport" in Boscobel which will cater mainly to private jets - yep private jets

http://www.jamaica-gleaner.com/gleaner/20091022/business/business4.html


We've spent approximately $52 Million from the TEF Tourism Enhancement Fund to fix roads in various communities, consultancy fees & refurbish a community ctr etc - yep all w/$ allocated for tourism

http://www.jamaica-gleaner.com/gleaner/20091022/business/business2.html

So as you can see a number of interesting developments took place....yet in none of these developments have I noticed a way to increase/improve/grow our passenger #'s. Have you? Maybe I missed it....What I see is a continuation of money wasting and attempts a putting bandaids on gaping wounds. Short term thinking means a long term loss...

What I did not put in this blog was that Airone has been requesting a license to start a low fare ailrine in Jamaica for 2 years - modeled after Ryan Air (http://www.ryanair.com/site/EN/about.php?page=About) Airone's plan is to provide cheap fares (not gimmicks like others) on short-haul flights (4hrs or less) within the Caribbean, USA & Central/Sth America. They still await a formal response from the government as they say they cannot do so until Air Jamaica is divested.

I didn't bother not because I work for them but because I didn't want anyone to feel I wrote this blog on their behalf. I didn't, I wrote it out of my own sense of frustration. If I were writing w/that hat on I'd really layout some ish on the table that would send your head reeling - you'd never believe it.

So will allowing casino gambling save us? (it hasn't saved the bahamas) then maybe a $300M investment in a private jet airport will? If not US$4M marketing campaigns in the US might? or eeven paying AA to bring...oops not bring passeengers may be the golden ticket? Or I suppose we as taxpayers will continue to pump $200M+/year into Air Jamaica while our education system slips to a further low while the airline soars to a new height of f&%ry.

But if we don't hold our leaders accountable and continue to turn a blind eye, not demand of them what we deserve, earned and paid for then who will? They certainly don't govern themselves...now do they?

I'm convinced Jamaica has gone mad

So the last few months I have been watching prices go up, the crime rate go up, jobs go down and the quality of life for the masses in Jamaica go down. Yet the current government has has done the following in the last few months re crime:

To remove the tint (yes tint) from buses and taxis:

http://www.jamaica-gleaner.com/gleaner/20091021/lead/lead5.html#

Regulating how bartenders dress:

http://www.jamaica-gleaner.com/gleaner/20091009/lead/lead4.html

Ignore an extradition order for the biggest drug don in Jamaica (while signing others)

http://www.jamaica-gleaner.com/gleaner/20091005/lead/lead1.html oh and btw the way in the meanwhile he got Millions ($100 M to be exact) of dollars in contracts awarded to him: http://www.sunheraldja.com/2009/10/%E2%80%98dudus%E2%80%99-receives-100m-in-contracts/

Change your Minister of Security from a former Colonel in the Army to a former Senator who was a Minister w/out Portfolio in FINANCE

http://www.jis.gov.jm/officepm/html/20090409t130000-0500_19146_jis_pm_announces_cabinet_changes.asp

Okay there's much more like spending pension funds of buying and refurbishing a house for your minister of transportation or spending almost US$1,000 on a chair for your minister of tourism or cutting back on travel expenditures but yet still your minister of sports/culture trampoozes in South Africa & your minister of Tourism in Asia somewhere....

Oh yea or spend millions upon millions on re-welcoming our athletes in yet another Homecoming while we raise our GCT (General Consumption Tax) on basic items including upping it from 16.5% to 25% on phone calls and phone credit.....not to mention pumping millions into a failing airline (Air Jamaica) that doesn't even depart nor arrive on time!!

What are we doing? Doesn't anyone realise this is our money? the money taken from our pay cheques each month or the tax we pay daily on items we buy? bills we pay?

WTF? I am outraged that this goes on and on and on and we don't stand up as a people. We don't get angry enough to say STOP! No more! What are we doing about education? Giving these poor uneducated youth opportunities to better themselves? Vocations? Skills? Something? Anything?

The talent that is in Jamaica is amazing!!!! Beyond the music, beyond the beaches...walk into any lane and you'll see for yourself. Hairs, eyebrows, nails....no previous training. They can make a wig with some hair & a stocking cap, thread your eyebrows into perfection and give you a mani/pedi like they hailed from Vietnam (seriously). The designs they do on your nails are unbelievable. And guess what it's not just women providing these services....it's both men and women

Why wouldn't we push this....give them the support they need/deserve? Fix up these lanes so that people are not just more aware of the services but are not hesitant to go there? Why not encourage the talent that is already here?

Teach a man to fish for Heaven's sake.....

I am lost! I am tired! I am hopeless! We're a resilient and talented people but....if no one nurtures it does it even matter?