José Antonio Gómez-Bazán, CEO of Camposol pointed out

“We will become the largest health food company in the world”

One of the goals of the leader of this important agribusiness player is to supply the markets with avocados and blueberries all year round, for which they have made significant investments in Colombia and Mexico. At the industry level, he sees significant consolidation in the coming years and South America as the planet's fresh food pantry.

“We work in the fields to improve lives”, this is how José Antonio Gómez-Bazán defines the stamp that he wants to imprint on his management as CEO of Camposol, a position he has held since the end of September 2021. After more than a decade in the ranks of This leading Peruvian agribusiness company takes on this new challenge with the love it feels for this company that has seen its transformation over time, and the conviction that its experience in this productive sector gives it.

Gómez-Bazán participated in Camposol from the beginning in the turn they gave to the company. They changed the canning business, in which they had stiff competition from China, for healthy and fresh food. "In the fruit business there was much more to contribute, Peru has a much more adequate climate and agronomic management to have high-value fruits and in a very attractive window. At the same time we had already started the process of vertical integration”, he recalls.

“We want to deliver our nutritional and health value proposition through other types of products that we are exploring to incorporate into our portfolio.”

Today the scenario is quite different. The company has more than 18 hectares of its own and its product basket includes blueberries, avocados, citrus fruits, grapes and mangoes in Peru, in addition to avocados in Colombia, citrus fruits in Uruguay, a small production of cherries in Chile and crops of blueberries in Mexico. Between 2012 and 2021, Camposol's sales have grown by around 8% and they have made a significant investment in the last three years that has not yet been capitalized in sales.

With what is already invested, they project a 50% growth in sales. These days, Gómez Bazán is preparing to return to the United States with his family, this will allow him to be closer to the production operations and in a more strategic location to maintain contact with the 10 managers who report directly to him and who are distributed in different countries of the region.

Lack of volume, not market

Assuming the challenge of being in charge of a company with more than 20 workers and a presence in more than 40 countries, in a complex world scenario, requires experience and significant leadership. However, he confesses that it was not difficult for him to make the decision to do so. "I feel quite calm with my team to be able to maneuver the company within this new changing reality, which will continue like this, I calculate, within the next few years."

The pre and post Covid worlds are different and the latter brings with it a series of important challenges such as "supply chains that are not balanced and that generate cost overruns, interruptions or ruptures that affect not only the way to reach the market but also the way in which that you supply yourself to be able to generate your base activity”, he adds.

What are the main challenges facing the company?

Our main challenge today is to have the volume to supply the customers we already have in the main markets. If we could stay in the avocado business with the volumes that we normally have leaving Peru, but in a 52-week window, Camposol's business in this product would triple in size. And in the case of blueberry, it would double. We have a fairly large relative size with our own production. Now we are focused on rebalancing that and include a third of our offer with third-party production.

And your next steps?

We are going to continue growing in avocados and blueberries. We are on the way to transforming the business through new technologies that allow us to have sustainable packaging, that maintain the quality and conditions of the product in long transits, with these logistical challenges that we have today. We want to deliver our nutritional and health value proposition also through other types of products that we are exploring to incorporate into our portfolio. We do not sell fruit, we sell the attribute that comes with the fruit.

In relation to blueberries, what is the development that you see both at the industry level and at Camposol for this product and the projection of the varietal change?

We have been testing different varieties, both in Peru and in Mexico. We have about 3.000 hectares of blueberries, which at some point will begin to be replaced. There we are looking to get the right varieties, which have the productivity and size and flavor profile that is right for the market. In that line we have some candidates that we are already trying to expand.

Peru entered a window where there were no blueberries and could sell twice as much without stopping selling, it did not become big in blueberries by selling them cheaper. Today the production in the Peruvian peak is higher than the production in the North American peak, something that we never thought would happen. It's already reached that point and now we have to stay competitive for other reasons.

What are the variables that allow you to maintain that competitiveness?

When you get to the point where your price has to be equal to that of Chile or the United States to be able to sell, you have to have the productivity per hectare. If before your business worked with 15 tons per hectare, now you have to think about having 25 tons per hectare. If before you had people you paid by the day and they harvested 15 kilos per person, you have to think about world standards of 50 kilos per person. And that they earn much more, but on the basis of productivity. In addition, you must ensure that 95% of what you obtain in the field is exportable. How do I work the quantity and condition of the fruit so that this is achieved. How do I get the supermarket, when it receives my product, to have a waste on the shelf of less than 5%, when with other countries they have 10% or 15%. What do I do to have packaging that helps me use less plastic and with that be more aligned with what the consumer and the world requires. If there are ways to reinvent the business, capture more value, in a sustainable way.

How are you developing sustainability as a line of work?

Camposol was born farming in the desert, where there was no water. So we are used to treating water drop by drop. We grew up with a vocation that the best way to control pests is not through chemicals but through biological balance. We also work with the community, with our workers. In the Group we have a project of 10 houses for our employees, of which we have already delivered close to 2. Our radius of action is about 100 thousand families in Peru. We try to meet the needs that the government sometimes does not deliver because we are far away. It is not our role, but in some things where we can make a difference we do enter. The export agro-industry of Peru and especially in the deserts that we have grown, have been engines of important social changes.

We believe that this is an ecosystem that has to be balanced and in fact our purpose as a company describes very well what we do in terms of sustainability. We work the field to improve lives. Improve the lives of our workers, the community, but also our consumers, who have access to healthy products.

A look at the industry

What is your vision of the industry globally and what role does the region and Peru in particular play?

We are seeing a world that is growing exponentially and it is important to keep in mind that population growth does not stop. The critical point is how much the world needs and how much it can produce. And here there is a huge gap in the food issue.

The fruit business is transporting water in the form of fruit, as simple as that. The countries that have water, land and people to produce are here in South America. Peru also has the advantage of having many water projects to develop. Today there are more than 200 new hectares and almost 90 hectares to improve, that is, 290 hectares that can be added to the Peruvian agro-export boom. And this boom is supported today in around 100 thousand hectares. Peru can become the planet's food pantry.

How does the current political, economic and social situation in Peru impact on the local agribusiness?

Twenty years ago we exported US$20 million and today we export US$100 billion in fruit products. That current level is equivalent to Peru's total export 6 years ago. It has had a growth that has not stopped and will not stop, except for climatic or political factors that are catastrophic enough to stop this green revolution as I call it.

We are going through a complex social process, the Covid has been a catalyst for social differences, where the private company met the needs of the people. When the pandemic arrived, this economic activity stopped a bit and it became evident that there was a lack of presence of State services such as health and education. And today this has been the catalyst for social movements that have an echo in the population because there is a real need. This Covid effect has been exacerbated by the disorder in the supply chain, plus the war between Russia and Ukraine that makes the price of fertilizers, oil, freight go up, all of that makes life more expensive. Inflation is going to be with us for several years and that is going to put more pressure on society.

Regarding the projections for this sector, in which area do you see the greatest growth and with what products?

In the north of the country there is great potential for growth, determined by these water projects. If the extension of Chavimochic III takes place -which is a dam that helps capture excess water during the rainy season- another 50 hectares will go into production there. Arequipa also has an interesting project, which could grow if it is unlocked. And incredibly, there are other development poles, smaller projects of individual entrepreneurs in La Sierra, where export agriculture has begun to develop, expanding Peru's productive window significantly with farmers going to La Sierra and the jungle. Not surprisingly, Peru becomes a year-round avocado supplier.

Breaking myths

What is the seal you want to print to your management?

In one sentence, “We work in the fields to improve lives”. This implies that we are a team, we come to transform, nothing is impossible. We are going to become the largest healthy food company in the world and we have the capabilities, the resources, the team to achieve it. You have to think big. I have been lucky enough to spend the first half of my career developing what Camposol is, telling the world what we do and I have had the opportunity to sit down with the CEO of Walmart, Costco and large companies, who not only listen to us, but who invite us to participate in their strategic conversations about where food is going. Or an Alibaba with Jack Ma and his CEO, Daniel Zhang, inviting us to lock ourselves up in China for a week to talk about where the future of food is headed. Harvard University writing a case of Camposol, this rare, unique company that does agriculture in the desert. Camposol transformed the desert, planted avocados where they supposedly didn't grow, brought blueberries where they supposedly didn't work, and sold them directly to all the major supermarkets in the world when everyone said that if you're an agricultural producer you couldn't do that. We continue to break myths.

In agribusiness, there has been a lot of movement of mergers and acquisitions at the regional level. Will they join this wave?

In terms of mergers and acquisitions, we already have enough scale to make important acquisitions that quickly add value to the company. We have the means to be able to access the stock market and leverage ourselves in a purchase transaction without any problem, and we have the option of being able to make an important transaction that could impact the business, both at the distribution and agricultural levels. We believe that there is going to be a lot of consolidation in the industry, especially with this crisis in which there is no fertilizer, transportation has doubled in price and the markets are complex, I think that there are going to be several companies that are probably going to have difficulties and that we are going to to be able to approach them and offer them an interesting transaction.

And what plans do you have regarding Chile?

We have our hectares of cherries, that was our first step in understanding how the business works in Chile. We are very happy with what we have done. This year our first kilos of cherries will probably come out. We have always looked at Chile not only as an important source of supply, but also as an interesting market.

We do not intend to add more volume of cherries where there already is, but rather to learn from the cherry business, because we believe that we can expand the business in Peru. We are learning in our own way in Chile, with the good cherry players they have and with the good technical quality there, to see if we can replicate something here.

How do you see the industry in the coming years?

Bigger and I think there's going to be a lot of consolidation. I see the industry managing its own destiny in terms of logistics, I believe that the banana management models that existed in its time, that had their own ships, will return. The consolidation that is going to take place is going to open space for many large companies to think that way. How do I get together with another company or how can I, with the scale I have, enter that business? More vertical integration, I think that this global uncertainty and these constant changes are going to make many companies want to control their destiny much more and have more control over the things that can really impact the business.

I see South America as the planet's fresh food pantry, its role is going to be to supply fresh food to all the big northern markets worldwide. And I see an agricultural business generating employment and sharing much of that value it generates with the worker. Agriculture is one of the activities that shares the most value with the worker, many times 30%, 40% of the value of the product is labor and to the extent that more and better market value can be captured, that is shared.

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