MUNZSSInlD - usaid

PAOEXAG
Deal Profile
Chiquita Melons in Costa Rica
3
1. In 1987 CAAP expressed its interest in developing a melon export sector in Costa Rica.
At that time Costa Rica lagged behind the rest of the Region in melon exports. We dic
not know how much Jay Nichols and Del Monte would achieve by early 1989 in this field.
2. Responding to CAAP's interest, John
assistance
Guy Smith
to a
of
pilot
PROEXAO
melon
agreed
production
to undertake
program technical
farmers in the Tempisque
sponsored
Valley
by CAAP
participated
in 1987/1988.
with small
Eight
used employed conventional acreages. gravity The
irrigation.
production As
model
capital intensive than drip such,
irrigation,
this model
and
is
thereforp,
much
medium farmers. Results easily accessible to small less
were mixed, anc
that
but enough
they had
was
learned
learned so
enough
that all
to
felt
expand
confident
production beyond the
commercial
pilot phase
production.
intc
3. During 1987/88 melon growers throughout
threat
Central
of
America
transport were
shortages.
operating under the severe
not realistically
The option of oper
a Mexican
to the
overland
southern part
route
of
to
the
markets
Region.
is
to CAAP and the new melon growers
PROEXAG's
was that
recommendation
through one of
market
the multinationals
access ideally which
should
could
be
offer
sought
marketing services. In
transport
the best
guarantees
of all possible
as well
worlds,
as
the marketing
provide:
company would
a.
b.
Post Harvest handling and packing technology.
Packing materials from inhouse carton manufacturing capability in order to reduce
costs.
c. Transport beyond South Florida to other ports of entry to enhance market access.
d. Marketing either on a commission or on a fixed price basis.
4. Castle and Cooke, Del Monte and Chiquita
to provide
were
transport.
approached.
Del
Castle
Monte was
& Cooke
busy
was
expanding
unable
through its newly acquired
its melon
Jay
production
Nichols subsidiary.
operations
Chiquita was interested.
5. A preliminary meeting took place
growers.
in June CAAP
of
and
1988
PROEXAG
between
were
Chiquita
present.
management and the
needs, and
At the
Chiquita
meeting
learned
the growers
their discussed
intentions. their
would
It was
be held,
agreed
at
that
which
a second
time Chiquita
meeting
would present an offer.
6. In September of 1988 a second meeting
growers was
at
held
CAAP's
between
offices.
Chiquita
PROEXAG management
was present.
and the
consignment marketing
Chiquita
of
presented
the melons.
an offer
Included for
in
the
this offer were some very
provisions:
attractive
a. Chiquita would provide
b.
the design
Chiquita of packing sheds.
c.
would
Chiquita
provide
would
packaging
guarantee
materials
trqnsport
at cost.
of
Wilmington,
the fruit
Delaware
either
or
on
on
its
conference
own ships
carriers
to
to South Florida.
A significant number of growers
purchase however,
contract felt
F.O.B.
that
Puerto
they would prefer a fixed
to
Lim6n. The reason
price
show their banks that payment of their fruit was for this preference was theassured,
need
and
be
that
taking
they
undue
would
risks.
not