Costa Rica sees Dubai as gateway to Mideast

Dubai: Costa Rica's banana producers association, Corbana, is eyeing Dubai as its future hub for exports to the Middle East.

The region has evolved as a fast-growing consumer market for bananas, Jorge Sauma, Corbana's CEO, told Gulf News during an interview on the sidelines of the Eurofruit Congress in Dubai last week.

Annual banana imports have almost tripled in the last decade, growing by around 16 per cent a year between 2001 and 2007, from 257,000 tonnes to 737,000 tonnes, according to Corbana data.

Together with the fact that consumption per capita still remains well below the average of mature markets like Europe and the US, "this suggests significant potential for further growth over the next decade," Sauma says.

Costa Rica is the world's third largest banana producer after Ecuador and the Philippines. Its export share in the Middle East is relatively small at 4.5 per cent of production, compared with 49.9 per cent shipped to Europe and 45.6 per cent shipped to the US. In the medium term, Sauma targets an export share in the Middle East of "nine to ten per cent".

This will be done in steps. Corbana already trades with Iran, Tunisia and Turkey and now seeks to establish new ties with traders via Dubai. "We are actively approaching trading partners, are trying hard to understand this market and will start a campaign for Costa Rican bananas," says Sauma. The Middle East markets currently are predominantly supplied by Philippine banana producers and competitors will have to provide a cost advantage.

Production costs

Besides established trade and distribution channels, pricing also helps the consumer since bananas from the Philippines are available at a very decent price that draws on high trade volumes and cheap production in the country of origin.

Costa Rica, on the other hand, has to deal with higher production costs as the standards of labour and wages, plantation methods and quality control are higher. "We are trying to be competitive," says Sauma.

"Our production methods are more sophisticated and elaborate, but at the same time our productivity is much higher than in other banana-producing countries," he adds.

In 2008, Costa Rica accounted for the world's highest yield per hectare of banana production for the 19th year, setting a record with global exports hitting $674.2 million.

Ninety-nine per cent of all Costa Rican banana plantations are certified for good agricultural production practices, for respecting the environment and for compliance with social, workplace and human rights standards. The country is now looking to remain one step ahead of competing producers by becoming the first carbon-neutral banana producer by 2014.

"We can offer a value-added product to the sophisticated Middle Eastern consumer by maintaining the high level of social, labour and environmental standards throughout the production process across our industry," says Sauma.

Sauma is interested in striking deals with the big supermarket chains in the UAE like Carrefour, Union Coop or LuLu, but also with green groceries. His time-frame to establish a trade network in the Middle East via Dubai is "one to three years".

Serving national producers

Corbana, Costa Rica‘s banana producers association, has been central to the country's banana industry for years. Founded in 1971, Corbana is a public non-governmental association whose mission is to "serve national producers".

Its main objectives are to foster the development of the banana industry, advise the government on internal policies likely to affect the banana industry and carry out research. Costa Rica's banana export volume was 1.87 million tonnes in 2008, valued at $674.2 million, which contributed 2.7 per cent to the country's GDP.

The banana industry in Costa Rica employs some 140,000 people directly and indirectly. The share capital of Corbana is held equally by the government of Costa Rica, the country's three state banks, and banana producers at one third each. Corbana is not a brand. It supplies international brands such as Chiquita, Dole, Del Monte, Fyffes, whose logos can be found on the bananas.