Agricultura

The Pina Project
BUSINESS OPPORTUNITY
March, 2012
Executive Summary
We have been presented with an opportunity that is becoming extremely lucrative in today’s food
market.
HPG, a pineapple production company located in Costa Rica and Panama, is offering an
opportunity to partner with them in order to fulfill a lucrative, long term contract with BANANA Brands
International. The contractextends through 2025 and the ultimate goal is to supply 5 million cases of
pineapple per year for their European market. There are several farms located near Frutas del Oriente
that are up for sale, and the potential net revenue for acquiring and cultivating 100 hectares of land for
pineapple production is at least $2.1 million dollars per year.
“Pineapple Production is moving into the bigleagues and in Central America, and their producers are
making a play for the export market. In a small measure these fruits have always been exported but now
producers are trying to cover more markets and to increase the production of these products so that they
constitute a significant volume of export.”
“In terms of the pineapple production, Panama has long been planting pineapples and has nowreached
its goal as the second pineapple producing country in the region after Costa Rica. It has taken Panama
ten years of study and duplicating Costa Rica´s methods to reach this spot. It is still far behind in Costa
Rica in terms of production as it only has 3 thousand hectares of pineapple plantations versus Costa
Rica´s 42 thousand hectares. It is important to note that Costa Rica boastsDOLE pineapple plantations
while in Panama pineapple producers are independent growers.”
The two paragraphs above are from “Panama Online”, a Guide to Lifestyles, Travel, Real Estate and
Adventures in Panama. There is no question that many companies and countries are looking to Panama
to supply their need for fresh pineapples.
HPG, is located in David, Panama in the Chiriquí province. Most ofthe planting in Panama
is done in Chorrera where 1,500 hectares of pineapple are located and then in Chiriqui. The MD2 variety
is the type that is planted for exported for the European markets. Their current pineapple production is
not enough to fulfill the contract with BANANA, so they buy from local farmers to make up the
difference. Our role will be a direct supplier to Frutas del Orienteby producing between 700,000 to
750,000 cases, based on the purchase of 100 hectares of land.
The total cost of the investment is estimated at $3.8 million dollars, based on the cost of land,
production and operating costs. Once the farm has reached first harvest, recurring costs would
drastically reduce, with a potential of exceeding over $2.6 million in net revenue in subsequent years.Additional information has been included in this pla
, is located in David, Panama in the
Chiriquí province. According to online records, they
incorporated in Panama in December 2009. The
plantation consists of 500 hectares, with 115 hectares
currently producing pineapples. They grow the MD2
variety that is planted and exported for
European markets.
As stated in the Executive Summary, theircurrent pineapple production is not enough to fulfill the
contract with Chiquita, so they buy from local farmers to make up the difference. The contract
commitment is for them to eventually export 5 million cases of pineapple per year. , one of the partners for the company, shared with us during our visit their expected yearly
targets for the next five years:
Year # of Cases Shipped/Year
2012500,000
2013 800,000
2014 1.5 Million
2015 2.1 Million
2016 2.5 Million
Ultimately, their goal is to get to 5 million cases/year
as soon as possible. One important note is they are
not penalized for not shipping 5 million cases, but it
is in their best interest to achieve that target (5
million cases =$30 Million+/yr.). The initial contract
only sold pineapple to 4 European countries:...