Photo: Charles Dambui
Statistics in 2022 have proven that the return of the Government’s investment in subsidizing price and freight for local coffee farmers is working.
Coffee Industry Corporation (CIC) Acting Chief Executive Officer Charles Dambui said the K1 million price and subsidy funding generated K7 million last year, and the Government’s intervention of K30 million for the price and freight subsidy in the 2023 National Budget is commendable.
“In terms of coffee, we always prioritize farmers that are reached by third-level airlines which are followed by Marine transportation and then of course by road. As we speak, the freight cost of getting a kilogram of coffee from a remote area across to the buying point is equivalent to the coffee price so sometimes you will realize that it is not economical,” Dambui said.
Mr Dambui stated that the continuation of the Marape Government’s subsidy program will increase coffee production statistics and put more money into rural farmer’s pockets.
He predicts there will be a likely increase in coffee production in 2023 on the back of the National Government’s financial support in the price and freight subsidy program.
“The government gave us K1 million for the freight subsidy and the return on investment was K7 million, in actual fact we freighted the coffee out from remote areas using that K1 million and when the cost of export was calculated it generated almost K7 million, so the freight subsidy program is the way forward,” he said.
The Minister for Agriculture, Aye Tambua, recently presented cheques to CIC with other agriculture commodity boards that received their first share of funding from the K30 million price and freight subsidy program -- this means the price of parchment coffee will now be tied at K7 per kilogram.
A portion of K1.5 million was given to the Coffee Industry Corporation (CIC) to carry out the price and freight subsidy support program this year.
Under its 2023 budget, the government has allocated a total of K30 million for the agriculture price support program and K20 million for the freight subsidy. The price support is specifically designed to support all commodities across the country to boost production in those sectors.
"The government has taken the right steps by setting the price at K7 and the CICs job is to make sure that the K7 price is realized by the farmers on the ground. We are taking that onboard and we will be working with selected buying points to ensure that we drive the government policy,” Dambui said.
Meanwhile, the CIC will continue to invest time and money to contain coffee berry borer pests throughout the country.
Dambui said the National Government’s drive to increase production level for this agricultural cash crop will fail if the disease wipes out the multimillion-kina coffee industry of the country.
“Without the coffee beans, all our initiatives will come to a stop so that's why our focus now is to control and contain the spread of the coffee berry borer. It's an economic pest that has a high chance of reducing the production in PNG as well as the country's coffee export,” he said.
"The coffee berry borer is currently spreading but the government is seriously looking into it to support the coffee industry so that we can control and minimize the spread of coffee berry borer,” Dambui said.
