Opinion: More investment and reforms needed in Papua New Guinea agriculture

Steve Woodhouse, Regional Manager NGI at Farmset and host of EMTV’s Farming PNG program, reminds Business Advantage PNG that Papua New Guinea’s agricultural sector is the backbone of the economy and a substantial contributor to national income. In the first of a two-part interview, he calls for changes to the way it is regulated.

Farmset’s Steve Woodhouse. Source: EMTV

What do you regard as the crops that have greatest up-side and why?

The main three agricultural exports are oil palm, coffee and cocoa. The agricultural sector contributes nearly 25 per cent of PNG’s income, and provides income earning opportunities to more than 75 per cent of its population.

The oil palm industry has set bench marks for agriculture, not only as the major export crop but with sustainable and environmental standards that are globally recognised. Indeed the country was a front-runner, in terms of RSPO, a certification system that accredits sustainable oil palm production.

A large number of smallholders are involved in the industry and, with extensive support from the major players, this sector has the potential to grow significantly.

‘The arrival of the coffee berry borer may detract from potential growth in the coffee industry.’

As with all of the PNG economy, there are also potential constraints. In the case of oil palm, these include increased plantings by non-RSPO-accredited operations and, for the smallholders, very rapid population growth.

Coffee roasting. Source: EMTV

Coffee and cocoa have also got the potential to expand considerably, and both are currently being promoted by a public-private finance arrangement by the World Bank and Government of PNG.

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The cocoa industry was devastated by the cocoa pod borer, a destructive pest, but the use of improved, tolerant, high-yielding planting material and improved management practices has seen a resurgence of the industry in recent years.

In addition, expansion of the crop into areas not traditionally known for cocoa production has seen an increase in the grower base. The arrival of the coffee berry borer may detract from potential growth in the coffee industry, but production in 2016 showed significant growth.

‘Support for the agricultural sector in PNG has been sadly lacking in recent years.’

This is an industry that supports an estimated 2.5 million people and, for it to flourish, there needs to be significantly more investment into the sector.

How would you characterise the support systems for agriculture, including infrastructure? Where do you think the Government could get the best returns on investment?

Vegetable farming. Source: EMTV

Support for the agricultural sector in PNG has been sadly lacking in recent years, and emphasis has been very firmly on the mining and petroleum industries.

Clearly, the largest issue facing farmers everywhere is the declining state of roads, bridges and access to market.

The horticultural production of fresh food for the domestic market is in excess of a billion kina each year, and estimates suggest that losses in the supply chain from farmer to buyer can be as high as 48 per cent.

There are other issues that relate to extension and research and, while we have a number of quality home-grown research and extension people, they are seriously under-financed and often not responsive to the true needs of village farmers.

Obviously, in the more remote parts of this diverse country, it is genuinely difficult to provide effective government services, but a lot more could be done.

In terms of best returns on investment, research needs to be re-directed and improved. A number of Asian countries direct as much as 20 per cent of income generated from export commodities, back into research and development. In PNG, this is nearer 2 per cent.

‘In terms of policy, the country needs to go back to the old system of commodity boards.’

It is not as though we cannot do it, 20 years ago we had some of the best cocoa planting material in the world, in the oil palm we supply planting material all over the world, from Dami Research station—even back to West Africa, from where it originated.

To keep up in these areas, inputs are necessary, we need to do more, and what we require has to be farmer- and producer-orientated, not just research for research’s sake.

What policy issues do you regard as the most important for the sector? What would you like to see happen after the National Elections?

In terms of policy, the country needs to go back to the old system of commodity boards, where they are simply regulatory bodies, ensuring a fair deal for the farmer.

Unfortunately they have become unwieldy, trying to take over extension and research, and trying to run entire industries. They have all become overly politicised, and as such the country needs to allow farmers, both large and small operators, exporters and processors to take back the reins of their industry.

Steve Woodhouse is the host of EMTV’s Farming PNG documentary series. The second part of this interview will be published on 20 June 2017.

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