Imporant Information you need to know about Agriculture Fees

November 20, 2009

IMPORTANT NOTICE

Basic Facts regarding increase in importation permission costs from the Dept. of Agriculture

Basic Facts on the increase in Warehouse Tax

In order for Vigoro Nursery to import any plant it is first necessary to obtain permission from the Dept. of Agriculture. This permission is in the form of a “plant permit”. Until the recent fee increases, this cost was $5.00 per entry. The fee increase which amounted to 2000% increase is now $100.00 to obtain their permission. Vigoro Nursery must pay per entry for all plant permits and are not allowed by the Dept. of Agriculture to purchase a yearly permit.

Grocery stores that import produce and florists who import cut flowers also had a fee increase. The difference is that grocery stores can obtain a permit for produce for consumption at a cost of $20.00 per entry or a maximum of $500.00 a year and the florists, $30.00 per entry or $750.00 per year.

Trees of 45 gallons or upwards arrive on a flat rack into Cayman. The permit fee, again, permission from the Dept. of Agriculture to import such trees was $5.00. It is now 100.00 dollars per tree. A flat rack usually has approx. 30 trees, thus $3000.00 dollars for the permission only.

A clear example of this impact on the nursery business is as follows:
Last week we requested approval for 5 import permits. Three were for flowering plants such as impatiens, begonias, etc. , one was for a container and one was for a flat rack of trees. Last week these 5 permits would have cost us $25.00. This week those same 5 permits cost us $3,100.00 C.I.

A further example is as follows: 100 boxes are received at the airport from our supplier of annuals.
The permit cost $100.00. With the increase in the warehouse tax, from $2.00 to $5.00, the warehouse cost alone is $500.00 C.I. The box tax has remained the same at $1.00 per box thus another $100.00.
It is important to note that since our boxes have perishable goods, they are not stored in the warehouse but are picked up as available yet we are told the law makes no differentiation thus we are charged whether they are in the warehouse or not.
Thus:

Before duty which is being increased from 20% to 22%
Before invoiced cost
Before cost of the Phyto which must accompany a shipment from the states
Before the air freight
Before the trucking
Before the spraying
Before the inspections
Before the labour or any other expenses involved we are at an expenditure of $700.00 C.I. dollars.

The effect of this is that there is no way to make the importation of plants via air viable and affordable under these current circumstances. We raised the price on a $3.00 plant to $4.00 and are still below cost. We cannot continue to do this. Also please note that the fee structure increases with increased weight thus bringing in more at a time does not help in the situation.

Many people say that we should just grow everything. Well folks we grow thousands of plants. The fact of the matter is that the farmers cannot supply the grocery stores with all of produce they need thus they must supplement the products via importation. The nurseries, even, if every single grower on the island did nothing else there would not be enough plants to supply the needs of the commercial and residential customers. Yet bearing in mind the current rates, we and you as a customer will not be able to afford any supplemental plants that are considered “tender” coming in by air.   These plants are the flowering hanging baskets, orchids, special bromeliads, annuals of all varieties such as petunias and impatiens and begonias to name only a few.   Obviously for the most part, the plants we fly in are those varieties that will not travel well in a container.

One of the reasons it is so difficult to deal with this recent increase is the fact that the expenses involved with importation of plants skyrocketed years ago as a direct result of the Dept. of Agricultures regulations regarding the necessity of 30 day quarantines and multiple inspections and multiple sprayings with specific chemicals before any plant could be imported due to keeping pink hibiscus mealy bug off the island. The reality is that the bug is here, has been here and it was not brought here by a nursery which is a direct statement from the Dept. of Agriculture. Yet, these huge expenses are still in effect and now we have further huge increases on top of those.

We are more than willing to do our share to help in this economy.   We have not raised our prices on plants in over 6 years even though our costs have indeed skyrocketed.   Yet this time, we cannot possibly absorb these increases on air arrivals and pricing them at a point where we can make even a little will be prohibitive to most.

There needs to be differentiation on the permits. Air arrivals, which are small boxes with small quantities needs to be different than those permits for a container of thousands of plants and if the warehouse is not being used we should not be charged at the same rate.   We have ideas to substantially increase revenue for Gov’t without such major impact on the consumer and in a more palatable way for our company.   We want an opportunity to meet and discuss the ramifications of the current charges and share our suggestions for assisting in this difficult economic time.

Without such a meeting and without some sort of change and understanding we will no longer be able to fly plants into the island which in fact means many of the plants loved by our customers will no longer be available on a regular basis. Since we have as many as two shipments per week, revenue will be decreased for all, including Cayman Airways that is the recipient of thousands of dollars from Vigoro Nursery yearly and of course just as importantly any revenue for government via this will be doubly lost with decreased duty revenue and decreased if not totally discontinued shipments.

We are asking that you talk with your MLA about this situation and support our efforts to have a meeting as soon as possible. Vigoro Nursery has been in business many years in the Cayman Islands and has always had a goal of quality in everything we do. We care about our community and we care about our environment and we care about the aesthetic beauty of our island. Please care and talk with your friends, your neighbors and your MLA representative.