January 24 (Bloomberg) -- The Kenya Agricultural Research Institute is banana paradise. The artificial sun shines on plants for 16 hours a day and hides for eight. Tender green shoots luxuriate in pint jars containing a milky liquid that’s rich in all the nutrients a growing banana needs. It’s a sterile environment, devoid of the pathogens and nematodes that stunt and kill bananas. Through a mask, researcher Susan Muli shushes me when I open my mouth with a question: “There are microbes!”
Muli is preparing tissue cultures of various banana species, marking their jars by date and variety – Chinese Cavendish, Uganda Green, Ngombe – then placing them in a climate-controlled, 15 by 20-foot room next to the lab. The room holds seven shelves of pint jars that together make up a nursery of 100,000 banana trees. Once grown, that’s enough to cover about 200 football fields and support nearly as many smallholder farms.
The plants sit on the shelves for five months before their transfer to an outdoor greenhouse. The institute sells them to farmers, who sell it to prospering buyers in Nairobi and Kenya’s growing cities.
The “tissue-culture” bananas are the products of simple plant science—it’s old-fashioned biotechnology. The tried-and-true methods that are common in Asia and Latin America are only beginning to take root in much of Africa, where one-third of the world’s bananas are consumed. In Kenya, only about 5 percent of banana acreage was under tissue-culture cultivation in 2006, a number at that time projected to expand to as much as 40 percent by 2016, according to Africa Harvest Biotech Foundation International.
The quest to build a better banana is about more than boosting fruit production. It’s an iconic subplot in the worldwide push for corporate sustainability. Global agribusiness has its own ideas for how Africa can help feed an anticipated 2050 global population of 9 billion people. Leading businesses know they need to be everywhere the future population -- and consequently, the biggest growth opportunities -- will be.
That’s in part what motivates companies such as DuPont to educate the world’s poorest farmers. DuPont subsidiary Pioneer Hi-Bred International has trained farmers in crop management near Nairobi. They’ve also provided farmers with credit, so that they can acquire the raw materials they need.
Such corporate projects in developing countries are the embodiment of “Creating Shared Value,” which Michael E. Porter and Mark R. Kramer described in an influential article last year in the Harvard Business Review: “A growing number of companies known for their hard-nosed approach to business--such as GE, Google, IBM, Intel, Johnson & Johnson, Nestle, Unilever, and Wal-Mart--have already embarked on important efforts to create shared value by reconceiving the intersection between society and corporate performance.”
For African entrepreneurs, the global trends buttress their own efforts to connect poorer farmers with local, regional, and international markets.
That still doesn’t make it easy. As is the case with cultivating bananas, there are bruises along the way.
A better Kenyan banana couldn’t come at a better time. Cavendish bananas, responsible for 99 percent of the world’s shipments, are threatened by a pest called Tropical Race Four, which has already wiped out the variety in Asia. Scientists believe the soil-borne fungus will make it to Latin America, home to four of the world’s top five banana exporters.
Should the fungus devastate Latin America, the world would see a repeat of the devastation that befell the Gros Michel banana, the most-popular variety of the first half of the twentieth century.
The pathogen that devastated the Gros Michel in Latin America pushed profits at United Fruit Co, now called Chiquita Brands, down 97 percent during the 1950s. That allowed rival Standard Fruit Co., now called Dole Food Company Inc., to become the leading fruit-seller by adopting the Cavendish, a position it holds to this day.
Kenya’s year-round growing season, and relatively stable economy by African standards, holds great potential as a banana-producer, first for local markets and potentially for exports, according to Henry Kinyua, a manager for East African fruits at TechnoServe, a nonprofit with the tagline “Business Solutions to Poverty” that has worked with Nestlé, Google, Lenovo Group, Procter & Gamble and Cargill.
Tissue-culture bananas give Kenya a chance to boost production just when the world may need new sources, said Gerald Muthomi, who buys bananas from farmers with his wife, Rosemary, and sells them in Kenyan cities. While one-third of the planet’s bananas are grown in Africa, only about 4 percent of all exports originate there. The disparity is an opportunity for poor farmers and agents who can bring their fruit to bigger markets.
Gerald Muthomi is wiry and expressive. He does most of the talking. Rosemary, dignified in a light-blue business suit of jacket and knee-length skirt, interjects guidance to keep him on-topic. We are sitting in their bright-white meeting room with windows open. An employee brings tropical fruit on a tray. A separate plate bears a single, banana that’s large and hearty. It’s not as curved as a typical American grocery-store Cavendish—and, like most every Kenyan banana, has more black bruises on its skin.
The banana tastes sweeter and grainier, yet softer than any store-bought Latin American variety flown from Ecuador to Minneapolis. “That’s a Gros Michel,” Gerald Muthomi says, the legendary lost fruit that still thrives in Kenya. What shippers used to affectionately call “Big Mike,” before it disappeared from northern store shelves a half-century ago.
As many as 84 distinct types of East African highland bananas exist. The world, however, doesn’t want 84 distinct types of East African highland bananas. It mostly wants just one, the Cavendish. So Kenya’s export potential will come from growing the main global varieties.
At markets, the familiar Cavendish increasingly sits side-by-side with the Kampala and other bananas, in their myriad shapes, sizes, and tastes.
When Gerald Muthomi was a child near Meru, Kenya, he grew and harvested coffee, a biological fact that led to his passion for helping poor farmers. All the children wore long shirts because pants were too expensive. The one pair of shorts available to his brother and him was available to whoever woke up first in the morning.
On the coffee farm, Muthomi’s father would require him to pick 50 pounds of coffee beans before leaving for school in the day. A village elder gave him some of his own coffee plants to introduce him to caring for his own crops. His real initiation into farming came with the the first French beans he grew, and what they represented to him:
“When I sold them, I went to town and bought my own trousers. I would walk around with my hands in my pockets. This was quite an achievement!”
Fifteen years ago, when the Gerald and Rosemary Muthomi left the Kenyan government to start their business, local farmers had no sense of growing for nearby or regional markets or what practices could improve their incomes.
The couple started their company, Mt. Kenya, by reselling the products farmers grew, thinking food crops shipped to Nairobi might be a promising alternative to coffee exports. They first took beans to the capital by buying bus tickets to the city, placing a 100-kilogram bag of beans in their seat and standing for the four-hour drive. Once they proved that French beans weren’t only for white people, they began selling fruit—first papayas, then bananas. They spent no money on advertising. As Meru bananas—and their banana sellers— became known in the Nairobi market, the Muthomis become known for their produce.
Sales at Mount Kenya Gardens rose from more than $500,000 in 2008 to almost $700,000 in 2009 as they supplied Kenyan grocery chains with fresh produce. The couple would like to begin exporting in the next few years, first to nearby African and Middle East countries, where it may be easier to meet foreign food-safety standards, then to Europe. Proper financing and enough farmers growing high-quality bananas could make the sky the limit for their business, they believe. They may be right.
Climate change in Kenya, as in the rest of Africa, is expected to worsen, possibly costing as much as 2.6 percent of Gross Domestic Product each year by 2030, according to a study by the Stockholm Environment Institute. Overall rainfall is expected to increase, the rains may become more erratic, and higher temperatures will speed evaporation. Worldwide, climate change could raise wheat prices 59 percent higher, paddy rice 56 percent higher, and livestock 39 percent higher than they otherwise would have been by 2030, according to Oxfam International.
Bananas are among the thirstiest fruit. The more-frequent floods and droughts predicted by climate change models increase the chance that bananas may be inundated with too much rainfall one season and left parched in another.
The Muthomis experienced the ills of poor rainfall—and poor finance— in 2010, when a lack of rain devastated production near Meru, about 140 miles northeast of Nairobi. The Muthomis extend farmers credit in the form of fertilizers and other crop needs. But conditions left farmers unable to grow food and pay the Muthomis.
“We are loyal to the smallholder,” Gerald Muthomi said. “We were smallholders, and smallholders take better care of the land. This is who we serve.” This loyalty had a price when loans came due and the farmers were unable to cover their debts with production.
“Last year we lost all our profits, because the drought was enormous and we couldn’t deliver. And what should we do? A young boy who is finishing school and farming a 10-by-10 plot of land can’t give me beans. Do you bring him to the police? So me and Rosemary sat down and absorbed the loss. We’ve been living from hand-to-mouth. Our biggest problem is finances. The droughts are unpredictable.”
The Muthomis’ work bringing fruit to larger markets is at the front lines of a battle that reaches across global companies’ supply chains, and quite possibly into your local supermarket. The global village enjoys a good banana -- it may take work on everyone’s part to ensure we can continue to.
This story is excerpted from Alan Bjerga's new book, Endless Appetites: How the Commodities Casino Creates Hunger and Unrest (Bloomberg Press, 2011).
Visit www.bloomberg.com/sustainability for the latest from Bloomberg News about energy, natural resources and global business.