Standard Fruit Company, a subsidiary of Dole in Costa Rica, laid off 412 workers last weekend who worked on banana farms in the Caribbean province of Limón, as confirmed to the local press by Juan Carlos Rojas, the company's legal director. "Our company is trying to maintain its agricultural activity in the country due to the abrupt strengthening of the colon, the local currency, against the U.S. dollar. 

We are trying to move forward, and we had to let go of 412 people from all the banana farms in the Caribbean, from Sarapiquí to the Valle de la Estrella," said the spokesperson. Rojas explained that the dismissed people were performing a practice called "daipa", which consists of placing protective bags on the banana bunch. "It is not the closure of a specific farm, but a reduction in personnel that we consider necessary and regret very much.  Rojas added that, for the moment, they are not clear about whether the company will make new adjustments in the operation of the farms. With the adjustment in the payroll, the banana cultivation division went from 4,000 direct jobs to 3,588 people. The multinational has more than 8,000 employees, including agricultural and administrative staff. "We would prefer not to have to make more adjustments of this type, but exchange rate policies are leading us to make these decisions," Rojas concluded. 

The recent dismissal of staff occurred just three months after the company eliminated another 111 jobs last February due to the liquidation of the Roxana and Parismina farms, located in Guápiles, in the canton of Pococí. Jorge Sauma, president of the National Banana Corporation (Corbana), highlighted that the exchange rate's evolution has affected banana producers, both large companies and independents, for more than a year. 

The U.S. currency ended Tuesday, May 7, at ¢512.01 in the Foreign Currency Market (Monex), but its level was ¢542.99 a year ago. In the last seven sessions of Monex, the currency experienced a price increase, according to data published on the website of the Central Bank of Costa Rica (BCCR). "The effect of the exchange rate worries us a lot because the banana industry is the main activity in the Caribbean area. 82.5% of employment in this region is linked to banana cultivation.  Sauma added that the negative effects of the exchange rate situation do not impact the sector immediately, as the level of exports and productivity of the farms has not decreased. "The effects are not in one fell swoop, but they are undermining. The outlook is very complicated. Hopefully, some balancing mechanism will be sought; it is not about the value of the colon, which is very low, but neither high," said Sauma. In the country, banana cultivation generates 150,000 direct and indirect jobs, according to Corbana data. According to Corbana, the international price of the fruit has been on the rise since the end of 2021, when it was at $1,160 per metric ton. Still, last April, it closed at $1,627 per ton, according to the statistics published by the Federal Reserve of St. Louis in the United States. For Sauma, the price of the fruit has not risen in recent months, but it has remained at a very similar level. However, the same has not happened with the dollar. "By having such a strong colon against the U.S. dollar, with a high labour cost, there is a strong effect because the income in the marketing of bananas is in dollars, but it is paid locally in colones, which hurts the financial stability of the companies," emphasised the president of Corbana. Sauma acknowledged that companies are not forced to take these measures with a more favourable exchange rate.

Rojas emphasised that the current value of the local currency has raised costs by 24% since 2022. "There is no doubt that, regardless of prices in the market, costs have risen exaggeratedly due to the exchange rate by lowering the value of the dollar in Costa Rica," he pointed out. The company spokesperson said they are fighting for survival to continue the operation.