The Rodney Dangerfield of the Economy
The room was packed, and the message came through loud and clear at the informational briefing this morning on the state of Hawaii’s agriculture industry. It was a joint meeting of the Committees on Agriculture and Water, Land & Ocean Resources.
The industry faces its more critical period ever, and without significant changes, agriculture as we know it, may cease to exist in Hawaii in the near future. Here are some of the highlights from the briefing:
Dean Okimoto – President of Hawaii Farm Bureau, Owner of Nalo Farms
Nalo Farms is at great risk. Okimoto has been working on an expansion project for a few years which he hopes to open on Monday. He has poured much of his savings into the project as he has had to pay off a loan with no incoming project revenue for the past 15 months. He says that it feels like he is losing business, not gaining business, and even the farm itself is not doing well.
The danger for the industry is that once we lose a farm, it never comes back. Nalo Farms is not alone. Several farms have closed in recent months. Part of the problem is that agriculture is like "the Rodney Dangerfield of the economy" – it gets no respect. In particular, Hawaii’s tourism industry is highly dependent on agriculture, but Okimoto believes that there is little recognition from the tourism industry, nor collaboration between the two industries.
Buddy Nobriga – President of Nobriga Ranch
Nobriga contends that the Hawaii Department of Agriculture is one of the smallest Ag Departments in the nation. The state needs a larger, stronger department that can help the farmers and ranchers. There are not enough inspectors to monitor the quality of imported milk. We don’t have strong relationships with the USDA. We don’t have the land to establish dairies.
We need agriculture in order to be sustainable. In a way, agriculture and farmers are like the "security" of the state.
Meredith Ching – Alexander and Baldwin (large landowner)
Large landowners face the same problems as small farms. The lack of rainfall in the past decade has had a cumulative effect on island crops. 2008 was the driest year over the past 85 years. In addition, the state has been in a prolonged drought for the past decade, with the past two years being exceptionally dry.
Yvonne Izu – Hawaii Farm Bureau, former state water commissioner
The legislature needs to amend the state water code law. The East Maui decision is a perfect example of how the water code does not support agriculture. This is one way the legislature can help farmers without spending money. Farmers do not have hope that agriculture can survive in this state.
Richard Ha – President, Hamakua Springs
The world has changed. He has had to lay off 20 workers recently. He says you can tell that farming is bad when fertilizer sales go down. Fertilizer sales have been going down since last spring. There is, however, an opportunity to use agricultural lands for energy crops. A bill passed last year allows farmers to finance loans for energy projects, although this may not be quite enough incentive to bring more people into farming.
He has a blog now. "These days, you gotta blog if you’re a farmer."
Eric Tanouye – Greenpoint Nursery
Tanouye’s 20-year-old son is in college and has said that he wants to work in the family business. This excites Tanouye because it would mean three generations working in the business. Tanouye is also the President of the Florists and Shippers Association and he has visited members across the state on all the islands. All of them face very difficult times. It is unprecedented.
Kylie Matsuda – Matsuda and Fukuyama Farms in Kahuku
She represents the 4th generation of farmers in Kahuku. She has a degree in Tourism Industry Management, but wanted to go back and be part of the family farm business. Her parents did not want her to do it, but she wanted to use her tourism expertise and expand the business into agri-tourism. She had to fight to get her job at the farm. She feels that farming can become viable again if you consider value-added products which will bring additional dollars.
For example, tourists can’t take home fresh fruits and vegetables, but they take back dried fruit, jams and jellies, and other products. There are also farm-related activities to market.
What can be done? Some suggestions:
*Clarify the state policy on water. The East Maui decision seemed to put farmers at a lower level of beneficiary than others. The water commission needs to understand the importance and value of the agriculture industry to the state.
*Provide tax credits for new farmers. Incent farmers to start farming.
*Support more farmers’ markets. It provides more revenue and forces farmers to interface with their market and the public, and through dialog, they can improve their product and have fun talking to people.
*Dean Okimoto summarized: He wanted to make it clear that the farmers are not looking to the legislature to solve all their problems. However, the legislature can be helpful in making other industries and the general public more aware that farming is critical to our state. Right now, tourism does not appreciate or support agriculture. Someone needs to hold their (tourism’s) feet to the fire in helping agriculture.
Chair Clift Tsuji and Chair Ken Ito expressed their appreciation to the farmers for coming today; they understood the gravity of the situation. They will be using the information from the briefing to propose legislation for the 2009 session.
MLP, which owns 24,500 acres primarily in Maui, Hawaii, including 10.6 miles of ocean frontage with 3300 of lineal feet along sandy beaches, has fallen on hard times during the recession. The company recently reported a $54 million loss for the second quarter, which included more than $37 million in writedowns, $21.3 million of which represented a decrease in value of the Company’s investment in the Kapalua Bay resort. Clearly, the downturns in real estate prices and resort visitors has been a double whammy for MLP. The stock now trades at $6.22, down 79% from its 52 week high of $29.69.