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New York Times - Berry Sales to U.S. Offer Security to Amazon Farmers
Berry Sales to U.S. Offer Security to Amazon Farmers
By TODD BENSON
Published: August 4, 2004
GARAPÉ-MIRI, Brazil - For more than 30 years, Raimundo Julião da Costa has eked out a living by selling a dazzling array of wild tropical fruits that grow naturally on his land in the lush floodplains of the Amazon rainforest.
His biggest seller has always been açaí (pronounced ah-sigh-EE) - a dark purple berry rich in nutrients that sprouts atop the millions of palm trees lining the riverbanks in the Brazilian jungle. But like thousands of other poor farmers, until recently Mr. da Costa found himself at the mercy of middlemen who have had a strong hold on the local fruit market for generations.
That started to change two years ago, when a few environmentally conscious surfers from a small California company called Sambazon offered to buy Mr. da Costa's açaí harvest at a 25 percent premium over the market price. The only catch - he had to designate a piece of his land as an ecological reserve and carefully manage the rest of his terrain to protect the biodiversity of the rainforest.
"It's worth the extra effort," said Mr. da Costa, 74, who is better known by his nickname, Seu Ediquínio. "I used to sell my fruit on the edge of the river to the middlemen, but they always pay the lowest price possible," he said. "Now I have a lot more security because I know what price I'm going to get ahead of time."
Mr. da Costa's American buyers may be relative newcomers, but they are already helping change the face of the tropical fruit trade in this part of the Brazilian Amazon. Because Sambazon offers guaranteed contracts, hundreds of peasant families are able, for the first time, to lock in a price for the bulk of their crop before the harvest. And as their sales become more lucrative, people have an incentive to preserve their habitat instead of abandoning it in search of work in nearby cities like Belém, where many former river dwellers live in poverty in crime-ridden shantytowns.
"The idea is to show the locals that it can pay off to become stewards of the forest," said Ryan Black, chief executive and a founder of Sambazon in San Clemente, Calif.
While those may sound like the words of a seasoned environmental advocate, it was Mr. Black's nose for business that drew him into the conservationist movement. He and a friend, Ed Nichols, came up with the idea for importing tropical fruit after tasting açaí during a surfing trip to northeastern Brazil in 1999. A few months later, they founded Sambazon, short for Saving and Managing the Brazilian Amazon.
Rich in antioxidants and amino acids, açaí is thought to be one of the most nutritional fruits of the Amazon basin. So Mr. Black and Mr. Nichols first went after the health-conscious, processing the fruit into packs of frozen pulp mixed with guaraná, another berry from the Amazon that contains natural stimulants. Then they started distributing it to juice bars and fitness clubs throughout Southern California, where açaí smoothies soon began supplanting wheatgrass protein shakes as the drink of choice among athletes and body builders.
Sambazon açaí is now carried by thousands of juice bars and grocery stores across the country, including such retail chains as the Whole Foods Market, Wild Oats and Trader Joe's. Chefs are also beginning to experiment with the fruit, whose taste has been likened to blueberry with a hint of chocolate. The Blue Door restaurant at the Delano Hotel in Miami Beach serves it with dinner entrees like veal tenderloin.
In most Brazilian cities, açaí is also a recent phenomenon, even though it has been a staple for indigenous communities in the Amazon for centuries. Now, in most parts of the country açaí is typically served as an ice-cold slush in a bowl, topped with granola and sliced bananas.
"When I came to Brazil in 1996, you could only find açaí in half a dozen places," said Travis Baumgardner, a 29-year-old Texan who runs Sambazon's Brazilian subsidiary in Rio de Janeiro and regularly visits the Amazon to monitor the harvest. "Now you can get it at over 5,000 juice bars in Rio alone. It has an air of nutrition and coolness that people love."
The rising demand for açaí is good news for both Sambazon, which has been in business four years and hopes to turn its first profit this year, and the families along the Amazon who depend on the palm berry for their livelihood. Sambazon buys açaí from more than 750 families organized into four fruit cooperatives in the Várzea Flooded Forest, an unusual microclimate in Pará state where the Amazon river rises over 30 feet every year and floods the surrounding jungle. As word travels that a foreign company is paying a hefty premium for açaí, hundreds more families are rushing to join the co-ops.
Açaí is a dark purple berry rich in nutrients that sprouts atop the millions of palm trees lining the riverbanks in the Brazilian jungle.
The New York Times
Buyers taste açaí berries at a market near Belém. American buyers are changing the face of the tropical fruit trade near Igarapé-Miri in the Brazilian Amazon.
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Still, not everyone is thrilled with the arrival of Sambazon. Mr. Baumgardner says he has received phone calls from a few local fruit processors who complain that the company is artificially forcing up açaí prices. And middlemen, who often work for fruit merchants in nearby cities, are starting to put pressure on açaí pickers to stop selling their crops to Sambazon. Despite the complaints, Sambazon represents only a sliver of the market, around 2 percent of the region's crop.
"There's no doubt that the middlemen aren't pleased," said Aluízio Solyno of the Federation of Social and Educational Organs, a local nongovernmental organization that helps the region's fruit gatherers set up co-ops.
"But there's also a concern that if acaí prices go up as a result of Sambazon paying a premium, that could hurt local consumers here in the region that eat acaí as a daily staple," he added. "I mean, the people who pick the fruit are benefiting, but a poor person who lives on the outskirts of Belém and eats acaí every day isn't."
One way middlemen try to woo locals away from importers like Sambazon is by offering cash up front to finance their harvest, an exceedingly rare financial luxury for small farmers in developing nations. But fortunately for Sambazon, the farmers here have another source of financing - EcoLogic Enterprise Ventures. A microcredit fund based in Cambridge, Mass., EcoLogic provides low-interest loans of $25,000 to $500,000 in environmentally sensitive rural areas in Latin America.
Founded in 1999 by William Fulbright Foote, a grandson of the late Senator J. William Fulbright, Democrat of Arkansas, EcoLogic manages $8.5 million in loan capital, $5.58 million of which has been disbursed or committed to 36 borrowers in nine Latin American countries. While that may look small on Wall Street, where Mr. Foote once worked, it is big money in the "green" lending universe, where the pool of potential borrowers is enormous and the available financing minuscule.
"There's plenty of entrepreneurial energy in communities like these," Mr. Foote said. "What we're trying to do is harness that energy with credit. It's not about philanthropy. It's about providing a dignified exchange of services."
EcoLogic's repayment rate is 98 percent, in large part because it follows a strict lending model that requires borrowers to have an existing sales relationship with an international buyer like Sambazon. EcoLogic, whose backers include church groups and nonprofit organizations, as well as multinational corporations like the Starbucks Coffee Company, delivers the money against signed contracts with the importers. Once the harvest is complete and shipped abroad, the importer pays the principal and interest due on the loan.
"It's commercial activity, yet the financing isn't really available from commercial sources," said Brian O'Neill, chairman of Latin America at J. P. Morgan Chase & Company, which provides financing for EcoLogic through the J. P. Morgan Chase Foundation. "EcoLogic fills that gap, that void, very nicely."
EcoLogic has been supporting the açaí co-ops in the Amazon since November 2003, when it lent Sambazon $175,000 for last season's harvest. This year EcoLogic expects to disburse $400,000 to the company - $300,000 on Aug. 1, just in time for the harvest, and the remainder in September, when the picking season kicks into high gear. Sambazon gets additional financial backing from environmental groups like the Nature Conservancy.
"This is financial no man's land," Mr. Foote said as he visited with açaí farmers at the Mutirão Association, a co-op on the Moju River that sells fruit to Sambazon. "So if you don't have the money on time, it will undermine your credibility, and these folks will think you're just like any other middleman."