Business, Finance & Economics

Rain, mud and dead bananas


MATINA, Costa Rica — A lone bulldozer nudges sludgy earth to the side of a dirt road. Nearby, someone uses mud to write graffiti on a water tower, tagging the name Roberto.

Copious mounds of mud remain after a devastating rainstorm hit this region last year. Before the November rains, this dirt road — on which the bulldozer is at work — served as the transportation route for thousands of banana boxes each day. From here, they go to Costa Rica's Port of Limon to be loaded onto ships. 

Things changed after the rains pushed rivers over their banks, flooding vast swaths of this country's Caribbean plains. The floods left one person dead and forced thousands more to leave their homes — where the water had risen above waist-level — and seek refuge in temporary shelters.

Unrelenting rains virtually drowned the bananas. Area residents returned home to find the once-lush green farms that were their livelihood turned into veritable banana graveyards. On many plantations, mud-covered earth sprouts grayish-brown trunks and bears no sign of fertility.

It took a Costa Rican plantation manager, Juan Goluboay, 10 days to reach his farm, Finca Agrifruta, in Matina, one of the cantons (the governing division between provinces and districts) hit the hardest by the floods. Water had burst the dikes on nearby canals, making the path to his and three neighboring plantations impassible.

When he finally got there, the damage was worse than he imagined.

“In my 20-something years in this business I have never seen anything this bad,” Goluboay said.

Finca Agrifruta's 600 acres grow bananas for the U.S. fruit giant, Dole. The farm produces an average of 648,000 boxes (each packing between 16 and 18 banana bundles) a year, mostly to the U.S. and to northern and West European countries.

Several months from the rains, the farm is still reeling. The floods wiped out half the property, creating likely losses of up to $1.8 million, Goluboay said.

According to Goluboay, the farm usually exports about the same amount to the U.S. as it does  to Europe. The ratio shifts after a major flood for logistical reasons, with North American buyers getting about 70 percent of the export crop. 

Goluboay's plot is just a slice of the Costa Rican banana farmland that was flooded in November. About a quarter of the 113,620 acres devoted to banana production in Costa Rica suffered flooding. 

The banana sector regulator, Corbana, estimates that losses will total $32 million, a sizable  chunk of the $650 million worth of gross earnings the country’s top agricultural export was expected to make this year. The industry, which employs about 40,000 workers, has already begun layoffs.

Unrelenting rains virtually drowned the bananas. Flood damage, which came in two waves during 11 days of rain, was more severe than in 2005 and 1970.

Flood damage, which came in two waves during 11 days of rain, was more severe than in 2005 and 1970. It could take more than six months for much of the plantation damage to bear fruit once more, according to Felipe Gamboa of Corbana’s technical assistance team.

To flourish as they do in this tropical climate, bananas must be resilient to water. However,  they cannot stay green after being cut off from oxygen for more than 36 hours, as so many acres were — in some cases, whole banana trees were submerged. This causes the plant to release a hormone, ethylene, that hastens ripening.

Banana bunches sitting ripe and yellow at the neighborhood grocery store didn’t look that way when picked and packed for shipping. Hanging from a tree, if a banana isn’t green it won’t bring greenbacks, in an exporter’s eyes. Ripening must continue along the journey all the way to a fruit bowl overseas, according to Gamboa.

A hit such as this to the crop in Costa Rica — which is the world’s third-leading banana exporter after Ecuador and the Philippines — could be felt by banana consumers worldwide.

While the "free on board box price" (which means that the shipper assumes the delivery charge) before the floods was $7.17, Corbana’s general manager, Jorge Sauma, says the price could rise by $1 or $2 a box in the first quarter of 2009, which would likely bump up the cost for consumers.

For now, those in the banana business are racing to repair roads, levees and fields before the next rainy season hits.

“This time it was our turn; on another occasion it will be others',” Goluboay said. “Being a banana farmer, you have to be resigned to taking your hits from nature. Those who aren’t can’t be in this sector. It’s part of the business.”