Agriculture

Steady As She Grows

Highly competitive exports and traditional farming converge in Costa Rica, while corporate social responsibility and environmental mindedness are key.

Although declining from 13.7% of GDP in 1995 to 6% in 2017, agriculture remains the second-largest source of employment in Costa Rica and comprises approximately 27% of the country’s exports. As such, agricultural activity occupies a central role in rural areas and economic policy.

According to the Organization for Economic Cooperation and Development (OECD) 2017 Agricultural Policies in Costa Rica review, agricultural exports grew by an average of 5.6% annually between 1994 and 2015, highlighting the trajectory of the sector over time. Though bananas, pineapples, sugar, and coffee continue to be Costa Rica’s staple exported commodities, the export of processed goods, such as frozen fruits, has increased by 95% over the past two decades. Nearly half of the country’s total agriculture exports are destined for lucrative North American markets, including Canada and the US.
In 2018, agricultural producers are looking to integrate new technology, emphasize value-added propositions, and focus on community building to further boost the sector. Specifically, value addition through processed products and additional services are expected to generate up to eight times more jobs than traditional farming.
PINEAPPLE CASE
Representing 2% of Costa Rica’s overall GDP, it stands to reason that the pineapple industry has become the most important segment of the agriculture sector. “In 2016, the pineapple export business was around 33% of the USD1.13 billion in total agricultural exports. Of the country’s total exports, fresh pineapples represented 8%,” Abel Chaves, President of National Chamber of Pineapple Producers (CANAPEP), told TBY.
In total, 43,000ha of land is dedicated to pineapple production at the national level, with nearly 50% located in Huetar Norte. National pineapple production generates roughly 43,000 direct and 120,000 indirect jobs. CANAPEP in particular supplies over 80% of the pineapples for the Americas and a significant 55% of the world’s pineapple market overall.
GOING BANANAS
On the other hand, the banana industry generates 140,000 jobs directly, especially in less-developed rural areas. Costa Rica exports approximately 121 million boxes of bananas per year, reaching nearly USD1 billion in revenue. “That represents 38.6% of national agricultural production, employing almost 12% of the economically active population,” the Minister of Foreign Trade, Alexander Mora, told the press in 2017. In addition, the banana industry is responsible for 36.7% of the total value of agricultural exports. Banana growers produce on 45,000ha, most of which is located on the Caribbean side of the country.
However, banana producers face economic and environmental challenges heading into 2018. “The main challenge is trying to remain competitive whilst upholding strong social conditions for workers and environmental efforts as well,” Jorge Sauma, General Manager of the National Banana Corporation (Corbana), explained in an interview with TBY. “We offer higher salaries to workers than producers in competitive countries, and to offset this we work toward trying to keep up our productivity.” With some of the world’s highest banana yields, Costa Rica already produces 2,800 boxes per hectare, but that figure is set to grow in coming years. “Another challenge faced by worldwide producers is fusarium, which is a fungal disease. We have partnered with a large German company in developing a bio-solution for this bacteria,” Sauma added.
The Banana Stabilization Mechanism that has long granted Costa Rica a tariff preference for bananas sold in the European market, is set to expire in 2019. According to Trade Minister Alexander Mora, Costa Rica will spend 2018 adapting and making the necessary changes in tandem. Crucially, operators in the banana sector are looking to automation and robotics in production and marketing, as well as mobile and digital technology. With climate change looming on the horizon, producers are expected to eagerly tap into energy-saving and environmentally friendly innovations as they enter the Costa Rican market.
GOOD AGRICULTURE
The country has already effectively reduced the number of agrochemicals used in agricultural activities, from 11kg of active ingredient per hectare in 2015 to 9.6kg per hectare in 2016, according to a report released By the State Phytosanitary Service (SFE).
In June 2017, the SFE revealed that it had invested over CRC300 million toward educational and informative campaigns regarding Good Agricultural Practices (BPA) for many of Costa Rica’s rural farmers. The main purpose of the programs are to train farmers in the practical and careful use of agrochemicals, including pesticides, herbicides, nematicides and other products specific to certain pests and diseases, as well as the nutritional needs of crops and soils.

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