The Packer / December 23, 1996
By Larry Luxner
SAN JOSE, Costa Rica -- Just outside the scenic town of Buenos Aires in southern Costa Rica, Del Monte Fresh Produce is trying something new: the development of a sweeter, more delicious pineapple that could revolutionize pineapple sales and bring more export dollars to Costa Rica's troubled economy.
The yellowish, hybrid fruit is called Del Monte Gold, and contains four to five times more Vitamin C than conventional pineapples. More than two million boxes of it have already been shipped from Costa Rica this year, compared to three million boxes of the regular champaka variety. The Del Monte Gold pineapple retails at $3.50 to $3.99 a pound on selected U.S. supermarket shelves, about $1 higher than normal pineapples.
"We've dedicated ourselves to very serious research to develop this technology," said Rodrigo Jiménez, general manager of Pindeco, Del Monte's Costa Rican pineapple subsidiary, during a tour of the company's vast operations. "We hope to replace the traditional variety with Del Monte Gold over the next four years."
In 1996, Del Monte alone exported 29 million boxes of bananas, five million boxes of pineapples and three million boxes of melons -- an incredible 10% of Costa Rica's total exports by value including textiles, furniture and electronics.
In Buenos Aires, a town of 7,000 people, the company's 3,000-hectare pineapple plantation contains around 225 million plants and employs 1,400 workers earning an average $1.50 an hour plus fringes. Pindeco accounts for 75% of the country's pineapple shipments to the United States and Europe, and this year generated $45 million in export earnings; next year, that number should rise to $50 million.
Even so, bananas and coffee are still king in Costa Rica, a nation with Central America's highest per-capita income and standard of living. According to the latest government figures available, agriculture accounted for $833.8 million in Costa Rican exports between January and July 1996. Of that amount, bananas came to $338.4 million, followed by coffee ($240.9 million); ornamental plants ($82.4 million); melons ($43.3 million); pineapples ($37.0 million) and other crops ($78.4 million).
In fact, says Jorge Arturo Sauma, general manager of San José-based Corporación Bananera Nacional, bananas are now Costa Rica's No. 2 source of foreign exchange after tourism. In 1995, the country exported 112 million boxes, and will close 1996 at 106 million boxes. That makes it second only to Ecuador, which exports over 180 million boxes annually.
Earlier this year, the Windward Islands Banana Development and Export Co. (Wibdeco) and Fyffes completed the sale of a 2,800-hectare banana farm in Costa Rica for $14 million. The two parties, which came together in a joint venture in December 1995 to acquire Geest's banana business for £147.5 million, say the farm has been acquired by a Costa Rican consortium with existing banana farming and related interests.
In addition to fruits, this peaceful nation also produces and exports everything from gourmet coffee to macadamia nuts. The country lures more tourists than any other in Central America, and its per-capita income of $2,706 is the region's highest.
Indeed, when compared to its northern neighbor, Nicaragua, Costa Rica -- with its stable government, lack of an army and generous social welfare system -- indeed seems prosperous. Yet the country's economy is in serious trouble.
Projected zero growth for 1997 and the country's growing foreign debt concern officials. Finance Minister Francisco de Paula Gutiérrez says Costa Rica's economy won't show any growth for 1996, while unemployment -- now just under 6% -- will rise in 1997. Private economic consulting firms predict the economy will shrink by 1%, though more optimistic forecasters see 1.5% growth if measures to control the debt are adopted.
No wonder the government is doing all it can to encourage companies like Del Monte to invest in new products, technologies and varieties.
"We think Del Monte Gold has great potential in countries like France and the United States," said Jiménez, a 15-year veteran of Del Monte, adding that "next year, we'll start making concentrate pineapple juice for the U.S. and European markets."
Not all of Del Monte's ventures are as successful. In late 1992 -- after eight years of research, $2 million in investment and endless bickering with the U.S. government and local indigenous groups -- Del Monte pulled out of the Costa Rican papaya export business for good. Jiménez said it just didn't make sense to keep fighting with the USDA, which kept Costa Rican papayas out of the U.S. market, ostensibly because of the possibility of fruit-fly infestation, following pressure from Hawaiian papaya growers worried about low-cost competition from Central America.