By TBY | Costa Rica | Mar 01, 2018
Costa Rica must contemplate the economic and environmental feasibility of becoming a large pineapple exporter following its first shipment to China in 2017.
As with all agricultural farming, there is a balance between growth and environmental standards. Costa Rica is in a unique circumstance following its first shipment of fresh pineapples to China. While this is a potentially lucrative demand market, there may be adverse effects on Costa Rica’s lush environment and its famous image of sustainability.
A 2003 tariff agreement between Costa Rica and the EU has helped establish the Latin American country as one of the largest exporters of pineapples globally. According to Abel Chaves, President of the National Chamber of Pineapple Producers (CANAPEP), Costa Rica “produces 2.9 tons per hectare, above Brazil with 2.6, the Philippines with 2.5, and Thailand with 1.9.”
As a result, pineapple production has become a legacy industry in the country where fresh pineapple and its variants represent 33% of total agricultural output, roughly USD1.1 billion, or about 2% of total GDP in 2016. 2017, however, has offered an additional boost to export potential by seeing its very first shipment of Costa Rican pineapple to China via the Caldera port in Puntarenas.
Access to the Chinese market is a major focus for many companies and countries in today’s globalized world, and Costa Rica has been no exception. The prospect of the Chinese market is not without its challenges, however.
Not only is the market demand not fully proven in its current nascent stage, there is the great geographical divide of the countries making shipment of a perishable good an ongoing drain on resources for exporters. There is hope that, through marketing the Costa Rican variation as a delicacy compared to its more bitter Filipino counterpart, they may see a boon to the already thriving pineapple business in Costa Rica.
Even still, there is another consideration that must be addressed, which is the viability of a country the size of West Virginia and its ability to grow enough supply to satisfy potential crippling demand from the world’s most populous nation. Simply offering up more land for pineapple cultivation amounts to further environmental degradation by tearing down pristine jungle habitat. It is a perpetual issue in Costa Rica and other sub-tropical emerging nations, and many struggle to find the sweet spot between maintaining pristine tropical ecosystems or stimulating job growth in usually rural, underemployed areas.
However, the true impact of job growth is a bit ambiguous. Pineapple production in Costa Rica employs roughly 32,000 people directly and 120,000 indirectly employed by the industry, not an insignificant figure in a country of less than 5 million people. However, roughly 70% of those employed are Nicaraguan seasonal workers, many illegal. Much of this money makes its way out of the country in the form of remittances, thereby, limiting the economic benefit of production.
Furthermore, Costa Rica’s entire national brand, from tourism to energy, is based on sustainability and greenness. How do they reconcile growth and greenness? The US and the EU represent an established export market and make up roughly 97% of current pineapple exports. Ultimately, the answer may simply be the status quo with a twist. During an interview, Chaves expressed his optimism and clarified that Costa Rica is looking to supply organic pineapples, a smaller niche market.
In similar efforts to fill other market demands, Costa Rica may be better situated to further develop its value-added processes like dehydrated pineapples or expand its organic pineapple production, a solution seemingly more suitable to such a small land mass servicing the richest regions in the world.