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Indiana Agricultural Trade Mission to Central America

Indiana’s Green Industry Finds Opportunities in Costa Rica

Indiana Agricultural Trade Mission to Central America
by Rick Haggard-Secretary of Green Industry Alliance

The Indiana State Department of Agriculture accompanied by Lt. Governor Becky Skillman and Congressman Dan Burton setup an Agricultural Trade Mission to Central America during January 8-13, 2006 and I was fortunate enough to be included. The president of the Green Industry Alliance and chairman of the Legislative Committee for the INLA, Mike Cline, was not able to attend due to personal reasons, so I was asked if I had a valid passport and would go. It took me a very short amount of time to make the decision to go on this venture. The countries visited on this trip would be Guatemala, Costa Rica and Panama. The purpose of this trip is to explore possible agricultural ventures between Indiana and the afore mentioned countries. This is also the first trip to Central America by any state or representative since CAFTA (Central America Free Trade Agreement) was signed by the United States.

It all started very early Sunday January 8, 2006 with a 7:30 a.m. flight to Atlanta and then on to Guatemala City, Guatemala. Which meant being at the airport by 5:30 am for international flights. This trip went very smoothly due to the excellent planning on behalf of the staff of the Department of Agriculture. Once we arrived in Guatemala City, about 2:00 p.m. Indianapolis time, the airport seemed small but very secured as evidenced by the armed guards and barking dogs. Our first day was the only day that was setup as a leisure day with some sightseeing tours of Guatemala City. Guatemala is a little smaller than the state of Tennessee. We even visited a handicrafts market where the locals would bring their handcrafted items to hopefully sell. The exchange rate was very good and you could definitely barter for the best deals. Monday it was back to work with a team briefing with the Guatemalan delegation which gave a brief outline of the countries income from the agricultural sector of the country. Agriculture brings in about 23% of the country’s income; however it is approximately 50% of the labor force. The average person in Guatemala has an income of about $ 4000.00 per year. We were told that the country does not really have much of a middle class, it is either the wealthy (extremely) or lower class. After our briefing we went to AGEXPRONT, which is a firm that groups allot of the farmers together to market their products to try and get them a better price for their product. After a lunch with Guatemala’s Food Processors’ Association (which by the way was very scenic high atop their office, being able to see the volcanoes and much of the countryside) we broke up into smaller groups to meet with other persons in our particular fields. Since I was the only really involved in horticulture they setup a couple of private meetings. On one of the meetings, I went to a local nursery/garden center/landscape firm. Did I mention that there is a lot of security around? The firm had an armed guard (with an AK 47) and had rod iron gates surrounding the office facility with an intercom before you could enter the place of business. There I met Lara and she told me that with conditions being what they are in Guatemala, they would travel 3-4 hours to a jobsite. While the trading of plant material is not very conducive for Guatemala with all the regulations perhaps with the CAFTA it could open up a little bit more. My next meeting was with Scott, who was originally from Guatemala, and lived in the U.S. for over 15 years before deciding that Guatemala was where he needed to be. He stated that the U.S. was just too busy for him and wanted to live a more relaxed life. He imports and exports some plant materials but mainly focuses on cut dried flowers. Everyone was very pleasant and besides where else could you go across town in a cab (approximately 12 miles) for $ 5.25. Our second working day started off with tours of a couple of major super markets which they refer to as hyper markets. Of note Wal-Mart has just purchased, I believe, 50% of the shares with regards to these hyper markets. The have about the same composition and much the look of what we see in our Wal-Mart/Meijer type stores and did not want to have any pictures taken of any areas, greenhouses included. I should have mentioned that Guatemala means “Eternal Spring” and other than getting used to seeing the extra security, Guatemala was very nice to visit.

We departed Guatemala around noon on Tuesday January 10, 2006 and headed for Costa Rica where we landed around 4:00 p.m. After checking into our hotel rooms we had our briefing with the Costa Rican delegation. Costa Rica is slightly smaller than West Virginia. Agriculture creates approximately 8% of the country’s revenue and comprises about 15% of the labor source. Costa Rica has also experienced double rate inflation each year over the last 3 years. While the have approved CAFTA, Costa Rica has not ratified it as of yet. Tourism is by far the largest form of income for the country, and I was told that for the first time they had to actually turn away request from travel agencies. Costa Ricans have an average yearly income of $ 7500.00, which is nearly double what the Guatemalans earn. There seems to be more interests on Costa Rica with the possibilities of trading plant material and other horticultural products. There is one problem that exists, even though they export more plants to the U.S., they are also rejected more times than other country due to pests’ problems. After a late dinner that evening at the home of Brad Corbett, a wealthy businessman that owns companies in the U.S., we adjourned back to our hotel to get ready for the next day. Wednesday, January 11, 2006 we started off with a breakfast briefing to discuss the possibilities of doing business with Costa Rica from more of a financial, customs clearance and the more stringent procedures Costa Rica has. After breakfast the “agricultural” group headed off to Coopa India. Coopa India is a Clean Stock Program which is a cooperative project involving APHIS, Purdue University, Costa Rica Ministry of Agriculture, National Production Council and the Tropical Agricultural Research and Higher Education Center (CATIE). It was great to see a familiar face at Coopa India, in the form of Dr. Cliff Sadof of Purdue University. He explained to me that while he has been there he has learned as much as he had hoped to teach. The purpose is to develop a way to export plants to the U.S. in a larger size and reduce the risk of pests in those exportations. There was a handful of us that were so intrigued with the possibilities that were being developed, we stayed longer to see what positive effect this might be for the end consumer. Obviously if a plant can be exported in a larger size it would mean less cost for a greenhouse grower to sell a plant in the U.S. than if they hadto buy smaller and grow on. Average temps in Costa Rica for your information are low of 65 and highs of 80. After leaving Coopa India I went back to the office of John Stewart, who is in Costa Rica as part of the APHIS team, and we discussed many other plants (annuals and perennials) that the local farmers who used to grow sugar and coffee are looking to expand their horizon and possibly increase the revenue from their farm. As John put it, “the ground that many of these farmers have is so rich in topsoil, you just throw a plant on the ground and it will grow.” John and I made a commitment that if Coopa India works out, we will keep in contact about what items as “Hoosiers” we would like to see grown that are too costly to produce in the U.S. After a nice reception at the Ambassador’s residence it would be a very short night with a 3:30 a.m. baggage check the next morning.

Our last scheduled stop before returning home was to visit Panama. I personally was a little concerned since the day before we were getting ready to head to Panama, the Minster of Agriculture resigned for reasons he stated were attributed to “pressure from the United States”. After arriving in Panama we headed to the Ambassador’s residence to be briefed on the agricultural difference Panama has as compared to the other countries we visited. One of the most glaring statistics that came from the briefing is that almost have of the population lives within Panama City proper. Their unemployment rate is approximately 12% and there is a great shortage of skilled labor but an oversupply of unskilled labor. The average income of a Panamanian is $ 7000.00 per year and of it is probably the most “Americanized”. Most of the plant material is imported from various countries with European countries supplying the highest concentration. Panama mainly grows common plants that are used, instead of specialty plants. For instance Panama may grow red, yellow or white hibiscus but they do not grow bi-color or other specialty forms/colors. After lunch with former President Dr. Nicholas Ardito Barletta, we went back to our hotel to go to private meetings that were setup. I was scheduled to have two meetings but only one made contact with me. Marcus was a local owner of a garden center and grocery store combination. It has been in his family for years and they now have three stores in the Panama City area. I was surprised to hear that they are one of only a very few that actually have a nursery, however from his description it sounded more like a holding yard instead of my concept of an actual growing nursery. I was a little astonished by the amount of material that was brought in from outside of the country, but the local garden center owners work very closely together in purchasing, forming what would be considered buyer groups. They meet about once every 2 weeks to discuss what the items are that they would want to purchase in the near future. Marcus stated that even though they are equally competitive they realize that in order for each to continue operating efficiently and profitably they must work together. Marcus commented every once in a while that a person, generally an U. S. American, wants to retire to Panama and open a garden center. With the amount of retirement income compared to the cost of living, the retiree ends up making the garden center too specialized and ends up closing after a couple of years. While he did not say this, I got the feeling that he was not invited to join or be a part of this buying group. This being our last stop it was another 4:30 a.m. baggage call to head back home where we landed at around 8:45 p.m.

I feel this trip was very worthwhile, perhaps not in the form of actually garnering immediate business opportunities, but being able to spend quality time with our Department of Agriculture and Economic Development divisions as how they view our sector of the agricultural industry.

January 12, 2006
Indiana’s Green Industry Finds Opportunities in Costa Rica
SAN JOSE, COSTA RICA – Andy Miller, Director of the Indiana State Department of Agriculture, sees promising opportunities for the state’s diverse agriculture industry. He is currently in Central America as part of Indiana’s trade mission.

One area finding growth potential in Costa Rica is Indiana’s ornamental plant industry. Rick Haggard, of Rail Trail Gardens in Zionsville, is representing the Indiana Green Industry Alliance on the trade mission. Wednesday he and other delegates visited CoopeIndia, an ornamental plant cooperative in Costa Rica, to learn more about the Clean Stock program.

Clean Stock is a cooperative program that uses integrated pest management to reduce pests on Costa Rica plant exports. The project involves USDA’s Animal and Plant Health Inspection Service and Purdue University, as well as the Costa Rican Ministry of Agriculture, the National Production Council and the Tropical Agricultural Research and Higher Education Center. Dr. Cliff Sadoff of Purdue works with the program’s partners.

Costa Rica is a world leader in ornamental plant exports and eliminating pests on those plants is a big concern. The program that Sadoff is working on will directly aid exports of ornamental plants from Costa Rica by reducing pests to protect U.S. agriculture.

Haggard is interested in Clean Stock because of the potential to benefit his customers. If the program proves successful in Costa Rica, larger plants can be exported to the United States, decreasing the handling time and costs to retail.
Because of the complementary varieties and growing seasons, Haggard sees benefits from trade in ornamental plants between Central America and Indiana. In Guatemala he found the nursery industry was diverse in the species they produced. In Costa Rica, he found the industry was more specialized. “The best ideas always come when you see someone else in the same industry doing the same thing in a different way,” said Haggard.

Contact: Meghann Foster
(o) 317-234-4044
(m) 317-696-9695