With the exception of Belmont Estate and the Grenada Chocolate Factory which partners with a small group of cocoa producing farmers, Grenada’s agriculture is driven primarily by conventional technology employing the use of synthetic chemicals. In both instances production follows an organic process that is certified by an external certifying agency. There is however a small number of producers that claim to produce organic products for the local market but their production process is not certified.
Grenada like most small developing economies in CARICOM/CARIFORUM depends on external trade for its economic and social development. Revenue from external trade (imports and exports) accounted for an average of 82% of GDP during the period 2002 to 2006 increasing from 72% of GDP in 2002 to a projected 84% in 2006. External trade was dominated by imports which accounted for an average of 90% of total trade during the 2002 to 2006 period. The negative balance of trade deteriorated an average of 10% per annum during the period 2002 - 2006. Primary agricultural exports accounted for about 57% of domestic exports between 2002 and 2006 moving from a high of 66% in 2004 to a projected low of 36% in 2006.
Agriculture continues to be a major contributor to the national economy following the near total destruction with the passage of Hurricane Ivan in 2004. Since Ivan, the Agricultural sector contribution to GDP has shown a steady increase from 4.50% in 2005 to 6.62% in 2009. Between 2004 and 2006 agricultural exports averaged 47% of total agricultural output moving from a high of 80% in 2002 to a projected 17% in 2006. Agricultural output has traditionally been dominated by exports of nutmegs and mace, fish, cocoa and fruits and vegetables (including bananas). With regards nutmegs an attempt was made to diversify the production process to include an organic production among a small number of farmers.
Domestic agriculture has shown significant growth particularly for fruits and vegetables in response to increased local demand by locals and tourist. However, the link with the tourist sector and persons seeking to change their lifestyle to consuming healthy organically produced foods has not been made. The issue of price for organically produced commodities for the local market is one that often shows its ugly head and one which GOAM has to address to move this situation forward.
Most agricultural production is carried out in the rural parishes and agriculture is the third largest employer on the island according to the latest available employment statistics.
The agriculture sector makes a significant contribution to economic and social development in Grenada as a major earner of foreign exchange through its exports which averaged $38 million per year between 2002 and 2004 with a high of $55 million in 2002; foreign exchange savings through increased production for domestic consumption; employment generation; and stimulation of economic activity in the rural areas.
Among the major factors limiting the growth of the sector are: sub-optimal utilization (low level of applied technology, inadequate training, etc,) of the limited available resources (land, sea, people); market opportunities constraints (Transportation, sanitary and phyto-sanitary (SPS) restrictions); Supply capacity, etc.; limited private sector investment (both domestic and foreign) in the sector; ineffective public sector investments; inadequate infrastructure to support the development of the sector; weak institutional framework and policy direction; loss of competitiveness in domestic production and production for exports; and natural disasters. Organic agriculture would be confronted with all of these factors and more; for instance acceptance of organic products as being a healthier choice.