The Government through the Ministry of Commerce Industry Labour and Immigration (MCILI) has signed separate Memoranda of Agreements (MoA) with the Commodities Exports Marketing Authority (CEMA), Kokonut Pacific Solomon Islands Ltd (KPSI), and the East Bauro Traders Limited, organisations who are involved with the Coconut and Cocoa Sectors.
The signing took place at the MCILI conference room on 29th September 2021.
The MoA with CEMA is targeting local copra and cocoa buyers, in particular, that local buyers will increase their buying prices in the rural areas. The higher cocoa and copra prices should incentivize farmers to produce and sell more cocoa and copra to local buyers and ultimately increase export receipts for Solomon Islanders.
Local Buyers play a critical role in the value chains but are often overlooked from government support.
The target stakeholders in the value chain are the local buyers, the rural copra and cocoa buyers, most of whom are rural based.
They are the link between local farmers and copra millers and copra exporters. In the past, copra exports from the Solomon Islands reached more than 40000 tonnes.
However, in 2020, copra exports were around 2000 tonnes, so there is an enormous potential for expanding the copra export sector.
The support will enable local buyers to raise their buying price according to a price agreed on with CEMA. The farmers will respond to the high buying price by increasing copra production by about 3000 tonnes, worth about 20 million dollars at current market prices, and 20 million dollars from cocoa exports at the current market prices.
For KPSI, the support would keep their price for First Grade certified Virgin coconut oil at $24 per kg, which increases from $18. The support also should translate into an increase in nut price by 0.10 cents and produce 100,000kgs from 1.8m nuts, injecting more than $900,000 into the village economy and generating more than SBD 2.7 million in exports earnings.
Another local business also supported is the East Bauro Traders Limited which is a buyer and exporter of cocoa beans. The assistance is mainly for Transport Logistics purposes, to help the company access cocoa farmers and processors quickly and link with the overseas markets.
According to the Permanent Secretary of the MCILI, Riley Mesepitu, the signing marks a vital milestone and implements the DCGA government’s redirection policy to support the coconut and cocoa exports sector.
In response, each of the representatives of the companies expressed their honor in the partnership with the government.