Pineapples of Change

Agricultural policies, for example—historically a domestic issue—have been thrust into the international realm. Any time a country or a group of nations such as the European Union contemplates changes in agricultural subsidies, quantity restrictions, or even quality regulations, international trade partners are quick to speak up against the resulting global effects of such changes. The following section, which is selected from Fundamentals of International Business, demonstrates how product safety and quality measures are influenced by global concerns.

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Though native to South and Central America, pineapples sold in the United States have primarily been grown in Hawaii. For many Americans, Hawaii has been equated with pineapple exports. A new variety of pineapple, however, has changed all that.

In 1996, the first “Gold” or MD2 strain of pineapple hit the retail market. Since then, Del Monte, one of the world’s leading pineapple producers, has seen a 174 percent gain in pineapple sales. The success of this new variety of pineapple is attributed to its sweetness, lower level of acidity, and uniformity. The Hawaiian Champaka, previously the primary pineapple sold in the U.S., was sometimes sour or hard; customers never knew what they were getting.

With the development of this new product, the pineapple industry has changed. Almost all the major producers now grow a version of MD2 and are tailoring their production to fit the needs of this new strain. Since Hawaii’s climate and soil are not very conducive to growing this new, sweeter variety, many producers are moving to plantations in South and Central America. Del Monte, for example, will plant its last commercial crop in Hawaii in 2008. This change provides an example of how environmental changes can alter the competitive picture around the world, with no fault by workers, producers, or consumers. Change is what often promotes progress. The shift in consumer preferences from tuna fish packaged in oil to tuna packaged in water led to a weeding out of competitors some decades ago.

Those affected, however, do not need to stand still. Hawaiian farmers now grow specialized crops such as noni, papaya, and macadamia nuts to fill the void. The revenue drop from pineapple from 1984 to 2004 has been restored by revenue from products such as coffee, flowers, mangoes, and other tropical fruits. Product decisions by companies like Del Monte free large numbers of workers and vast expanses of land and have accelerated growth in the specialized crop industry. Former pineapple plantations and those working on them have been quickly absorbed in Hawaii’s ever-growing specialty foods market.