Colombia awakens to agricultural potential
Political conflicts, lack of infrastructure and logistical problems have hampered Colombia's fruit industry growth, industry players expect that is going to change. Olmué Colombia chief executive officer Enrique Villegas, spoke to www.freshfruitportal.com about how his company is looking to develop the frozen fruit and vegetable processing and marketing business.
The company was formed in 2010, following a merger between Colombiana Oriente S.A and Chile's Frutícola Olmué, and in July this year they started building a 5,000 square meter processing plant in Valle Río Cauca.
The valley covers more than two million hectares with a natural forest and is a priority horticultural area because of its diverse climate.
"In 2006 we were thinking about developing a fresh fruit business but because of problems with road infrastructure, and the entry and exit of ships, we gave up on the idea.
"So when we met Frutícola Olmué and they said they wanted to start up in countries with tropical fruit it was like music to our ears."
Internal conflicts and lack of infrastructure problems
Villegas says 40 years of internal armed conflict is one of the reasons why Colombia has failed to become an agricultural power.
However, according to Villegas the situation has improved due to the efforts of former president Álvaro Uribe and the current leader Juan Manuel Santos, who started dialogue with the guerillas that gradually has been restoring peace and stability to the country.
"Before security issues frightened investors, but everything has changed after Uribe managed to subdue the guerillas, and at the moment they are showing a peaceful stance.
"Now I can move around the country calmly and if there are areas where I think there may be some difficulty I can call the general of the region who can provide me with security."
Another reason, according to Villegas, for Colombia's slow development of the fruit industry on a global level is because the country's population consumes most of what is grown.
"We have a population of 46 million and we do not produce enough to supply the domestic and overseas markets. We had problems with seed access, especially for pineapples, and this deterred farmers from planting."
However, he is optimistic this mindset has changed thanks to government incentives and promotional campaigns that have motivated farmers to see their production as a business.
"The agricultural sector is waking up and it is becoming aware of the importance of being active on a global level. Within the next four to five years Colombia will be doing important things and we will be part of this."
Colombia's Agriculture Ministry and other authorities are internalizing global quality and safety standards and training farmers and technicians on how to achieve this.
"We do not have enough specialized technicians. Valle de del Cauca has more than 2,200 hectares of pineapples, yet I know only one expert on this subject.
"The universities are not teaching crop rotation. I am proposing that students in their first year at the Universidad Nacional gain experience so that when they graduate they have the necessary practical knowledge, and not just the theory."
He adds just 3% of the country's national credit is invested in agriculture because it is regarded as risky.
Frozen fruit - an opportunity for the sector
He says Olmué Colombia has opted for the frozen business due to the country's lack of road infrastructure and modernization because it doesn't run the risk of fruit spoilage during shipment.
"Colombia has about 5 million hectares, including 350,000 devoted to fruit and vegetables, and although we have a lot of variety we are limited in volumes.
"Also, political issues have kept us apart from the world and this has not allowed us to keep up with international treaties and export. Therefore, the fruit we produce is for domestic consumption.
"We want to give to the world fruit which only Colombia can produce such as physalis."
It was with this goal that Colombia Olmué started building its processing plant together with administrative offices.
The company plans to process tropical fruit such as pineapples, guavas, tamarillos and passion fruit, as well as strawberries and blueberries.
It is extimated the plant will reach 25% productivity in its first year handling 17,000 metric tons (MT) in its first year resulting in 9,000MT of processed fruit.
Currently bananas account for 97.9% of Colombia's exports according to the International Trade Centre figures for 2010.The Colombian Agricultural Institute (ICA) also ranks the fruit as country's largest export with 2,105,963MT shipped in 2011.