Fifteen years ago, few people would have bet on blueberries as a profitable crop for Peru’s northern coast. The region, consisting largely of desert lacked the necessary cold temperatures and a tradition of producing the fruit. But between 2010, when the country exported almost no blueberries to 2020, Peru became a powerhouse in blueberry production and the world’s largest exporter of them, with annual production of more than 162,000 metric tons, or $1 billion in export earnings.
The tale of how that remarkable transformation occurred goes back to steps the Peruvian government took beginning in the late 1990s, including a new agriculture law, a free trade agreement, and extensive irrigation projects that helped transform the Peruvian coast from a dry expanse to a breadbasket, with a cornucopia of exportable grapes, avocadoes, and other fruits and vegetables. It is also the result of a move, shared by many other parts of Latin America, towards science-based agriculture, with deep research into plant genetics and other life sciences and new forms of corporate organization, intended to meet new niche markets in the United States, Europe and other developed markets.
Many of those stories of technological and organizational transformation and their potential for national job creation and growth are told in a new IDB report entitled “Competing in Agribusiness: Corporate Strategies and Public Policies for the Challenges of the 21st Century,” which is based on more than 30 case studies of Latin American companies that successfully integrated into international agri-food markets. The story of a company that helped spark the revolution in Peruvian blueberry production helps, like many of the others, to illustrate key themes of modern agricultural innovation in the region and the difference even a medium-sized company can make.
A Knowledge-Intensive Blueberry Firm Takes Off
The story begins in 2006 when Carlos Gereda, the founder of Inka’s Berries, returned from Chile, where a blueberry boom was underway, with 14 varieties of the fruit to test their viability in Peru. Despite lack of knowledge about blueberries in local agricultural research stations, Gereda settled on four varieties that could be grown on the northern coast and concluded that blueberry production was potentially very profitable, given the high demand for the fruit in the Northern Hemisphere and a low production season there extending from September through November. Inka’s Berries eventually focused on a variety called Biloxi, a publicly available one that was best adapted to local conditions. It teamed up with the Universidad Nacional Agraria de La Molina (UNALM) to jointly develop a nursery and began to work to produce seedlings and plants that could be grown faster and sold cheaper than those available in other countries. Essential in those efforts was its first client and research collaborator, Camposol, the leading agro-export company in Peru, which helped Inka’s Berries test the initial varieties while becoming a client and transforming into a powerhouse in blueberry exports.
Inka’s Berries soon became an important supplier of seedlings to several large local agro-export companies, purchased 250 hectares of land north of Lima to serve as demonstration plots, and embarked on an alliance with the University of Georgia to develop new varieties of blueberries that would replace its Biloxi variety, deeming it too acidic and too old for long-term use. Those efforts with the American university produced two new varieties with better productivity, flavor, size, and shelf-life. They also resulted in a commercial agreement in which the collaborators share intellectual property rights, but the University of Georgia’s royalties decrease over time as new generations of the plants are produced.
Today, Inka’s Berries continues to expand, exporting blueberry varieties to Spain, Portugal, Morocco, Mexico, the US, Namibia and South Africa, while engaged in the entire commercial chain of production, with its own laboratory, nursery, packing plant and blueberry exports, including significant amounts of fruit sold directly to supermarkets.
Key Factors in Peru’s Agricultural Innovation
The company’s success owes much to its ambition and ingenuity in plant genetics and production. But several other factors have also been key. As in many other triumphs of modern agriculture in the region, the state has played a positive role: carrying out the large irrigation projects and other innovations that helped transform the Peruvian coastal desert and generating relatively easy and fast protocols for the importation of genetic material that allowed Inka’s Berries to import and then test the seedlings developed at the University of Georgia. Inka’s Berries also benefitted from knowledge-sharing and financial collaboration with clients—in this case Camposol—and with academic and research institutions, like the University of Georgia and Peru’s UNALM.
More universal factors, like growing demand for healthy fruits and vegetables in overseas markets and the improvement in cold storage for long-haul transportation have similarly played a critical role.
Technological and Organizational Transformation Throughout the Region
The story of Inka’s Berries is but one of many revealing a far-reaching transformation in the agricultural sector’s technological and organizational structure in Latin America. Over the last two decades, knowledge-intensive companies—once thought to reside overwhelmingly in the manufacturing sector—have emerged in vigorous fashion to create new ventures that can access international markets and meet international productivity standards. Just as Inka’s Berries innovated and triumphed, many other creative companies are turning agriculture into the epicenter of modernization and high-quality job creation in the region, replacing the conventional manufacturing industries that were essential to dynamic technological progress in the 1970s and 1980s.
Leave a Reply