The Importance of Kava to Fiji’s Economic Development
It was a typical sunny day in the San Francisco Bay Area — a bit cold for my LA-born acclimation, but sunny nonetheless — in September of 2015. A group of delegates from the Fiji Ministry of Agriculture gathered around Acting Permanent Secretary Uraia Waibuta.
“We need to get more of this in the ground, quick,” he directed to Jone Sovalawa, Director of Crop Extension. Vio, the youngest of the delegation and designated administrative assistant, frantically scribbled notes as the PS spoke.
This scene came on the tail end of a visit to various kava dealers, retailers, and bars in the San Francisco Bay Area and Sacramento. I organized the visits in my role with the Fiji Trade Commission, a commercial office of the Fijian Government in the United States, to support the Ministry of Agriculture on their Market Scoping Mission. The Ministry intended to gain a better understanding of where Fijian agricultural products were going in the U.S., what their biggest obstacles and competition was, and what the future may hold in terms of demand. For kava, they found more than they had hoped for.
A Quick Introduction to ‘Kava’
For those who are not already aware, ‘kava’ typically refers to a drink made from grinding up the roots of the Piper methysticum plant, a crop found throughout western Pacific Polynesian and Melanesian cultures in Fiji, Tonga, Vanuatu, and Hawaii. The plant takes about three to five years to grow to maturity from planting, after which the plants are harvested and the roots ground along with cold water produce a drink, known as grog in Fiji, which is consumed both socially and during ceremonies of cultural significance.
Consuming kava leads to an altered state of consciousness, and though it is often compared to alcohol in this sense, it leads to a more relaxed and aware state rather than hyper. Whereas you get “turnt up” with alcohol, you feel more “turned down” with kava.
Kava is, naturally, a staple in the lives of Pacific Islander communities living across the United States, particularly on the West Coast where over 70% of the nation’s Pacific Islander population (outside of Hawaii) lives, according to the 2010 U.S. Census. Most importers distribute online or in retail stores, but one of the most rapidly growing methods of consumption is via kava “bars,” which prepare and offer the beverage in an open and social bar-like setting directly to consumers.
The delegation had a lot on their plate for their visit to the States; they met with U.S. Customs & Border Protection, USDA APHIS Agricultural Staff, importers and distributors of Fijian products, Fijian entrepreneurs in the United States, and successful international grocers in ethnic neighborhoods of California. We conducted the visits over a course of two weeks on a schedule of 3–4 meetings per day.
Importers they met with were happy to discuss their enterprises in Fiji, and the best practices they had gathered from years of importing kava. And demand was on the rise. Tahal’s Importers, a relatively sizable operation in the Bay Area, expressed that it was becoming more difficult to get the kava they needed to keep up with consumers. The delegation asked how much he expected demand to grow within the next 5 years.
“In the next 5 years? It will at least double.”
When the delegation visited Tyler Blythe’s “Root of Happiness” kava bar in Rancho Cordova, California, they were both amazed and thrilled to find that the customers of the bar were all American — meaning, by their estimation, of no discernible Pacific Islander background. There was a true, growing demand among locals for a distinctly Fijian product.
Mr. Blythe, who is also President of the American Kava Association, echoed and upped Mr. Kumar’s earlier estimation: he expected demand to not just double, but grow exponentially. He also feared a rise in prices as the amount of kava available was not sufficient to meet short-term demand.
Immediately after this visit, the Ministry drafted a press release in the Fiji Sun identifying the U.S. as a $15 million market for kava. The delegation was floored to find out the level of demand for kava they experienced in North America. But meeting the demand, in 2015, already had a host of problems to plan for. Then, in 2016, Cyclone Winston arrived and created hundreds more.
The Obstacles and Challenges of an Island Nation
One of the most interesting aspects of my time with the Fiji Trade Commission was seeing the difficulty an island nation faces in building up its export base. Distance from major markets (with the obvious exceptions of Australia and New Zealand) meant longer shipping times for produce and the need to freeze most products to ensure usability. The relative proximity of agricultural powers in Central and South America to the United States, as well, meant stiff competition for agricultural products that were both cheaper and more plentiful — if also of a slightly lower quality. And marketing a nation known for it’s beautiful tropical resorts and unparalleled opportunities for tourism as a provider of premium natural products was a challenge that will persist for decades to come.
Kava is unique in that it is able to subvert or work around these main obstacles: it stays fresh over long periods of time, is uniquely available in the Pacific Islands and not subject to intense competition, and is a growing consumer trend in North America.
But, nevertheless, obstacles remain.
Last February, the New York Times released an article introducing the growing demand for kava in the United States, and the challenges Fiji is facing domestically in meeting that demand. Two key areas highlighted in the article are the effects of 2016’s Cyclone Winston on agricultural production and the inefficiency of current agricultural and management practices of cultivators in Fiji.
While the article mentions Cyclone Winston, it fails to mention the extent to which the tropical storm devastated the agricultural sector in Fiji. And kava, which takes three to five years to grow , was one of the crops most sensitive to the damage. The fear expressed by U.S.-based importers in 2015 — that prices would rise due to lack of supply — was rapidly realized in a way they did not expect. And to add insult to injury, Cyclone Winston just happened to hit at the time when Fiji was really waking up to the promise of kava as a chief export crop to the United States.
Also mentioned is the lack of uniformity and efficiency in cultivation practices across the island nation. This is not unique to kava, and is a challenge faced by the entire agricultural sector in Fiji. Differing management practices, land and soil suitability, and the lack of a standardization among produce for export leads to differing quality in kava not only from farm-to-farm, but also from shipment-to-shipment. This was a major complaint among U.S. importers of Fijian produce — sometimes, they had no idea whether the product they would receive would be usable. What’s more, they say, substandard packing and shipping practices, independent of the farmer themselves, can lead to the arrival of an unusable shipment.
Fiji does have a key strength in that it is relatively untouched and allows for the cultivation of pristine natural resources. Much of the country’s export marketing and its “Fijian Made” campaign like to stress this. However, it is not rich in land. Agriculture takes up space, and since Fiji has a limited amount of space it is imperative to use that space effectively.
While international NGOs and the Ministry of Agriculture work to educate farmers on better management practices for their crops, Fiji is also facing very real policy decisions about how to use its limited space to produce growth moving forward. The government’s interest in manufacturing, business outsourcing services such as call-centers and ICT, forestry to produce mahogany, and more is in direct competition with the agriculture sector for land.
Bringing any kind of agricultural product into the United States is not as simple as sending a package and making a sale. It is more and more important for kava products to be prepared, packaged, labelled, and shipped correctly, to satisfy FDA regulations and inspections.
A real system of standards and quality assurance is also important here. If something unfavorable is found within a less-than-satisfactory batch of kava, a knee-jerk reaction by the FDA could ensue and cause a raise in regulations or even a country-wide ban, as has already been done in Canada. This would lead to decreased profits for importers or an inability to import at all, dealing a major blow to Fiji’s export potential.
Importers themselves also face challenges, mostly due to management inefficiencies with domestic production in Fiji. The most successful importers of kava and other produce from Fiji had their own deals with cultivators where they buy direct and arrange the shipping themselves. They ensure quality through good relationships, their own system of standards, and, occasionally, by paying just a bit more than their competitors. For those who not only imported but also ran their own agricultural enterprises in Fiji, the key was to have a good manager on-the-ground who worked efficiently and was able to ensure that their employees weren’t arriving on “Fiji-time” — a.k.a. about 2–3 hours after the start of their shift.
Towards New Policies and A Brighter Future
The Fijian Ministry of Agriculture — and the government as a whole — now see the United States market as one of their best opportunities for growth in terms of the export of agricultural products, with kava leading the way. This is a rather recent policy shift, as prior to the Market Scoping Mission in 2015 the Ministry was unaware of the potential for the crop in the United States. Further, while most other Fijian crops can be substituted for cheaper and more plentiful versions grown in South America and Asia, kava is a uniquely South Pacific product.
The Pacific Horticultural & Agricultural Market Access (PHAMA) program launched its Kava Quality Standard Manual in March of 2017, representing a huge step forward in quality assurance for kava. This will undoubtedly create more confidence abroad, and can only help the market grow.
When my former boss returned to Fiji to take the helm of the Ministry of Agriculture in March 2016, he knew the road ahead would not be easy to guide Fiji through the setbacks it was encountering as a result of Cyclone Winston and the data we had gathered in our work on the subject. Nevertheless, Fiji is pushing ahead with its ambitious plan to develop its agricultural exports and build towards a more sustainable and affluent future for its citizens.
I no longer work with the Fiji Trade Commission, but some of the professional relationships I made there will last a lifetime. there is no culture like Fiji that can make an outsider feel like one of their own. Last year, Fiji won an impressive victory in the Olympics’ first-ever Rugby 7s, and you will now find Fijians around the world pursuing entrepreneurial enterprises in North America, working and living in Europe, and even studying in Asia. Many of these Fijians see a large degree of success, and their earnings and investments help to their family and friends back home grow as well.
Last week, I was in Silicon Valley for a conference on US-China cross-border tech investment. As I was on my way back from a quick excursion to a local wilderness area (to balance out the day full of networking and speaker activities), I recognized the flag hanging from my Uber driver’s rearview mirror as that of the Kingdom of Tonga, Fiji’s neighbor in the Pacific.
“You guys have kava in Tonga, too, right?” I asked.
“Yeah of course, but the best kava comes from Fiji.”