Costa Rica is well known as a paradise tourist destination, but there is much more that differentiates the country from other Latin American countries. High-level decisions made in the past seventy years have impacted the country’s fresh produce industry, setting it apart as a boutique supplier of fresh produce. “Costa Rica hasn’t had an army for 70 years and instead, funds have been allocated to education and healthcare,” says Pedro Beirute, CEO of Procomer, an organization in charge of exports from Costa Rica. “We have built a peaceful society, being one of the oldest democracies in Latin America and having one of the highest life expectancies in the world. We are frontrunners when it comes to renewable energy with 100 percent of our electricity coming from renewable sources, mostly water.”
These are just a couple examples, but they have helped the country to attract mass manufacturing and high-end companies. “It has helped us have a more balanced economic proposition as well as a diversified agricultural industry,” Beirute said.
“In terms of ag production, we have become a good citizen. Growing high quality products while following the right processes is key for us.” This includes a focus on certifications, labor rights, respecting people, traceability, rainforest alliance, non-GMO, etc. Due to a smaller scale agricultural sector, Costa Rica is unable to compete on price, but the country sets itself apart by quality. “What started 70 years ago, has become natural for us now and we aim to keep a good balance between social and economic progress. Our strategy is to sell the best quality products to the best clients,” Beirute added.
Bananas and pineapples are Costa Rica’s largest fresh produce categories. However, several micro-climates combined with low and high-altitude regions result in the country having a strong position in growing exotic fruits as well. It is increasingly expanding into healthy superfoods including rambutan, pitahaya, ginger, and exotic roots.
“The banana was one of the top winners during the pandemic,” says Procomer’s Alex Román. Because of the health benefits, demand for this item kept growing and seems to be maintaining its growth. “However, recently retailers have been putting pressure on the sales price of bananas, which is also affecting Costa Rica’s banana industry. Fortunately, our banana sector is very well organized, and we collaborate with other organizations to discuss what’s going on and how we should react. We defend our industry as a team.”
In addition to increasing production of healthy superfoods, the country also sees opportunities in the organic segment. “Our goal is to become the organic gateway to the world,” mentioned Beirute.
With a population of just over 5 million, Costa Rica heavily relies on exports. How has the country been able to make exports so significant? “Having ports on both the Caribbean coast and the Pacific Ocean coast naturally drives exports,” said Beirute. “In addition, we have free trade agreements with more than 50 countries, including North America, the European Union, and China.” With exports being so important, the country’s next challenge is to improve logistics to reach new markets. One of the latest developments is Procomer opening an office in the Nordics. “There is not a huge population, but it is a market that appreciates good practices and is willing to pay for it,” he added.
This year, exports are showing record growth numbers. In total goods, exports are showing 27 percent growth YOY, an exponential number the country hasn’t witnessed before. Agricultural exports amount to about $3 bln. and are showing 5 percent growth this year. How have these growth numbers been achieved? First, economic recovery resulted in increased demand for (higher value) products. “Secondly, we are seeing a near shorting effect caused by the pandemic, which results in strategic procurement. US buyers in particular are balancing the risk instead of just being focused on buying at the lowest price. They are allocating more purchases to Latin American countries than to Asia to guarantee supplies. Another reason for increased exports is Costa Rica’s position. “People feel comfortable about buying from us as we are a country of hope, well-being, and values.”