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Good agricultural practices

Regenerative agriculture: collaborative hubs in territory with linkages

Photo by Shutterstock

Regenerative agriculture: collaborative hubs in territory with linkages

Compare IOA
Country
Costa Rica
Sector
Most major industry classification systems use sources of revenue as their basis for classifying companies into specific sectors, subsectors and industries. In order to group like companies based on their sustainability-related risks and opportunities, SASB created the Sustainable Industry Classification System® (SICS®) and the classification of sectors, subsectors and industries in the SDG Investor Platform is based on SICS.
Food and Beverage
Sub Sector
Most major industry classification systems use sources of revenue as their basis for classifying companies into specific sectors, subsectors and industries. In order to group like companies based on their sustainability-related risks and opportunities, SASB created the Sustainable Industry Classification System® (SICS®) and the classification of sectors, subsectors and industries in the SDG Investor Platform is based on SICS.
Food and Agriculture
Indicative Return
Describes the rate of growth an investment is expected to generate within the IOA. The indicative return is identified for the IOA by establishing its Internal Rate of Return (IRR), Return of Investment (ROI) or Gross Profit Margin (GPM).
In the Huetar Caribe Region, the reported cocoa yield is 0.6 per hectare (12).
Investment Timeframe
Describes the time period in which the IOA will pay-back the invested resources. The estimate is based on asset expected lifetime as the IOA will start generating accumulated positive cash-flows.
Medium Term (5–10 years)
Market Size
Describes the value of potential addressable market of the IOA. The market size is identified for the IOA by establishing the value in USD, identifying the Compound Annual Growth Rate (CAGR) or providing a numeric unit critical to the IOA.
< USD 50 million
Average Ticket Size (USD)
Describes the USD amount for a typical investment required in the IOA.
The approximate cost for the initial investment in a farm that starts its transition towards organic production is USD 1940 However, if the person already has the inputs, the key costs are Biodigestor USD 235 and compost bin USD 240.
Direct Impact
Describes the primary SDG(s) the IOA addresses.
Life on Land (SDG 15)
Indirect Impact
Describes the secondary SDG(s) the IOA addresses.
Responsible Consumption and Production (SDG 12) Zero Hunger (SDG 2)

Business Model Description

A disaggregated business model with emphasis on innovation and product seeding that targets collaborative hubs in the territory with linkages.

Expected Impact

Promote regenerative practices in agricultural activities that can raise productivity and gender inclusion.

How is this information gathered?

Investment opportunities with potential to contribute to sustainable development are based on country-level SDG Investor Maps.

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Disclaimer

UNDP, the Private Finance for the SDGs, and their affiliates (collectively “UNDP”) do not seek or solicit investment for programmes, projects, or opportunities described on this site (collectively “Programmes”) or any other Programmes, and nothing on this page should constitute a solicitation for investment. The actors listed on this site are not partners of UNDP, and their inclusion should not be construed as an endorsement or recommendation by UNDP for any relationship or investment.

The descriptions on this page are provided for informational purposes only. Only companies and enterprises that appear under the case study tab have been validated and vetted through UNDP programmes such as the Growth Stage Impact Ventures (GSIV), Business Call to Action (BCtA), or through other UN agencies. Even then, under no circumstances should their appearance on this website be construed as an endorsement for any relationship or investment. UNDP assumes no liability for investment losses directly or indirectly resulting from recommendations made, implied, or inferred by its research. Likewise, UNDP assumes no claim to investment gains directly or indirectly resulting from trading profits, investment management, or advisory fees obtained by following investment recommendations made, implied, or inferred by its research.

Investment involves risk, and all investments should be made with the supervision of a professional investment manager or advisor. The materials on the website are not an offer to sell or a solicitation of an offer to buy any investment, security, or commodity, nor shall any security be offered or sold to any person, in any jurisdiction in which such offer would be unlawful under the securities laws of such jurisdiction.

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Country & Regions

Explore the country and target locations of the investment opportunity.
Country
Costa Rica
Region
  • Costa Rica: Cañas
  • Costa Rica: Cañas
  • Costa Rica: Cañas
  • Costa Rica: Tilaran
  • Costa Rica: Tilaran
  • Costa Rica: Tilaran
  • Costa Rica: Upala
  • Costa Rica: Upala
  • Costa Rica: Upala
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Sector Classification

Situate the investment opportunity within sustainability focused sector, subsector and industry classifications.
Sector

Food and Beverage

Development need
Address 254.19 square km of priority cropland for decabornization. Improve productivity of the agricultural subcluster.

Policy Priority
Promote inclusive and sustainable development.

Gender inequalities and marginalization issues
High percentages of unemployed working-age women (5.02 potential gender index).

Investment opportunities introduction
The subclusters of this pole are expected to be enhanced by the TELCA corridor. Chorotega Triangle.

Key bottlenecks introduction
177.9 km of roads in poor condition, 250.66 square km with access problems to energy substations, 334.93 square km without 4G connectivity, 234.14 km with gaps in social development.

Sub Sector

Food and Agriculture

Development need
Sustainably improve agricultural productivity, ensuring the regeneration of soils and natural resources.

Policy Priority
Regenerative agriculture can replenish soil nutrients and produce sustainably.

Gender inequalities and marginalization issues
The territorial regenerative development approach can facilitate the inclusion of women and improve the inhabitants' quality of life.

Investment opportunities introduction
Cocoa and vegetables (lettuce, tomato, sweet chili, cabbage, among others).

Key bottlenecks introduction
Reduced diversification of production, lack of value-added, and scarcity of key organizational linkages.

Industry

Agricultural Products

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Pipeline Opportunity

Discover the investment opportunity and its corresponding business model.
Investment Opportunity Area

Regenerative agriculture: collaborative hubs in territory with linkages

No-till farming, biodiverse polycultures, soil conservation, mulch, anti-erosion barriers; use of compost, biofertilizers, organic bio-controllers; holistic livestock management; and edible forests. Key activities identified are Cocoa and vegetables.
Business Model

A disaggregated business model with emphasis on innovation and product seeding that targets collaborative hubs in the territory with linkages.

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Business Case

Learn about the investment opportunity’s business metrics and market risks.

Market Size and Environment

Market Size (USD)
Describes the value in USD of a potential addressable market of the IOA.

< USD 50 million

CAGR
Describes the historical or expected annual growth of revenues in the IOA market.

Between 2011-2015 Cocoa exports grew 32%. Since 2014 the vegetable market has grown 15%.

Critical IOA Unit
Describes a complementary market sizing measure exemplifying the opportunities with the IOA.

In 2018, the nationally certified area of organic spices and vegetables was 237 ha (11, 13).

As of 2016, international cocoa bean prices exceeded $3,000 per ton, and world production was 4.5 million tons (12).

As of 2019, 68.33% of tomato farms mainly use chemical fertilizer. As of 2019, 92.59% of cabbage farms mainly use chemical fertilizer. The world production of organic vegetables reached 676,000 ha (11).

Indicative Return

ROI
Describes an expected return from the IOA investment over its lifetime.

In the Huetar Caribe Region, the reported cocoa yield is 0.6 per hectare (12).

GPM
Describes an expected percentage of revenue (that is actual profit before adjusting for operating cost) from the IOA investment.

Currently, there are excellent genetic materials or clonal varieties (clones) that show high yields and high tolerance to the main diseases that limited the development of cocoa cultivation in Costa Rica: Monilia (Moniliophthoraroreri) and MazorcaNegra (Phytophthorasp) (8).

The selling price of organic products per unit marketed is higher than the price of a conventional product. It was determined that the percentage difference in prices for carrots was 28.57%, celery 40%, 25% for coriander, 33.33% for lettuce, and 66.67% for broccoli. It was also evident that conventional products had a higher total cost of production than organic products (7).

Investment Timeframe

Timeframe
Describes the time period in which the IOA will pay-back the invested resources. The estimate is based on asset expected lifetime as the IOA will start generating accumulated positive cash-flows.

Medium Term (5–10 years)

Cocoa fruit production begins at 2-4 years, yields increase every year until 8 to 10 years, stabilizes between 11-15 years, and is maintained from 16 to 30-35 years (17).

Depends on the vegetable. The production cycle of lettuce can vary between 40 days and three months. The production cycle of greenhouse tomatoes is eleven months. The typical life cycle of sweet chili can vary from 6 to 12 months.

Ticket Size

Average Ticket Size (USD)
Describes the USD amount for a typical investment required in the IOA.

The approximate cost for the initial investment in a farm that starts its transition towards organic production is USD 1940 However, if the person already has the inputs, the key costs are Biodigestor USD 235 and compost bin USD 240.

Market Risks & Scale Obstacles

Market - High Level of Competition

Organic products tend to have a higher price than conventional products so that that price competition can be challenging in non-specialized markets.

Capital - Requires Subsidy

To finance the initial investment, producers usually require support capital.

Market - Highly Regulated

Organic production certifications are required (e.g., UTZ certification for cocoa, organic certification for agricultural products, biosuisse).
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Impact Case

Read about impact metrics and social and environmental risks of the investment opportunity.

Sustainable Development Need

Address 254.19 square kilometers of priority cropland for decarbonization. Improve the productivity of the agricultural subcluster.

Gender & Marginalisation

To promote the sustainable increase in the productivity of women-owned agricultural farms.

Expected Development Outcome

To increase the Social Development Index (SDI) in this development pole.

Gender & Marginalisation

To decrease the gaps in the Potential Gender Index in this development pole.

Primary SDGs addressed

Life on Land (SDG 15)
15 - Life on Land

15.3.1 Proportion of land that is degraded over total land area

Current Value

Carbon emissions from pole's exports: 0.86%.

Target Value

By 2050, foster highly efficient agri-food systems that generate low-carbon goods for export and local consumption.

Secondary SDGs addressed

Responsible Consumption and Production (SDG 12)
12 - Responsible Consumption and Production
Zero Hunger (SDG 2)
2 - Zero Hunger

Directly impacted stakeholders

People

According to the 2014 Agricultural Census, in the province of Guanacaste, 7300 farms use agro-conservationist practices, and in Alajuela, there are 21057 (14).

Gender inequality and/or marginalization

As of 2014, 15.4% of agricultural producers in the canton of Cañas and 11% in the canton of Tilarán were women. At the Guanacaste province level, 16.2% were women (14).

Planet

Exports from this cluster produce 3.48% of carbon emissions.

Corporates

The agriculture subcluster represents 30.43% of the companies in this cluster.

Indirectly impacted stakeholders

People

People living in the cluster could be exposed to fewer herbicides and fertilizers, improving their quality of life and having fresh, quality produce.

Gender inequality and/or marginalization

Empowering rural women is key to reducing inequality and poverty.

Planet

Global reduction of carbon emissions through the use of more efficient production tools.

Corporates

The value chain associated with the agricultural subcluster.

Outcome Risks

Weak linkages to commercialize the product in specialized markets.

Impact Risks

Provide technical and financial support to producers to consolidate their production.

Impact Classification

B—Benefit Stakeholders

What

Increasing agricultural yields and productivity.

Who

Smallholder farmers and exporters.

Risk

Lack of linkages to access niche markets to place produce in.

Impact Thesis

Promote regenerative practices in agricultural activities that can raise productivity and gender inclusion.

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Enabling Environment

Explore policy, regulatory and financial factors relevant for the investment opportunity.

Policy Environment

Territorial Economic Strategy for an Inclusive and Decarbonized Economy 2020-2050 in Costa Rica: Transform agriculture through R&D&I towards technological innovations (1).

National Decarbonization Plan 2018-2050: Promoting efficient agri-food systems that generate low-carbon export goods and local consumption.

Strategic interventions plan 2019-2022: Promote sustainable and competitive production through innovation, access to technology, application of good production and manufacturing practices, value addition, and associativity (16).

PIEG: Women's land tenure and private property are fundamental factors in the fair and equitable distribution of wealth (3).

Financial Environment

Financial incentives: Of the funds placed by the Development Banking System in 2019, 45.09% went to agricultural activities. There are also financial incentives from Article 38 of Law 8591, which correspond to 0.1% of the single fuel tax.

Fiscal incentives: Law 7210, Free Trade Zone Regime Law; Law 7092, Income Tax Law, which gives differentiated treatment to MSMEs and SMEs.

Other incentives: Specialized support from MAG's Organic Production Department. Family Orchards Project led by MAG in Tilarán. Family Fair of Producers 2018 in Upala.

Regulatory Environment

Law 7779, Law of Use, Management and Conservation of Soil: Promote the implementation and control of improved practices in the systems of use that avoid erosion or other forms of degradation of the soil resource (4).

Law 7064, Law for the Promotion of Agricultural Production and MAG: Promote the production of agricultural goods by encouraging producers to increase production (5).

Export Guide: Exporting a product or service involves a series of procedures such as exporter registration, Technical notes or exit permits, Certification of origin (11).

Law for the Development, Promotion, and Encouragement of Organic Agriculture and Livestock Activities Nº 8591 and Regulation Nº 29782-MAG, Organic Agriculture Regulation (6).

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Marketplace Participants

Discover examples of public and private stakeholders active in this investment opportunity that were identified through secondary research and consultations.

Private Sector

EARTH University, National Chamber of Organic Agriculture (Canagro), local fairs, Jugar del Valle, Fundación Neotrópica, Asociación Creciendo Juntos, Cooperativa de Producción y Consumo Ruta de la Vida Ecológica (ECOOVIDAR.L), Asociación de Productores Orgánicos de la Zona Norte.

Government

SFE, MAG, SINAC, MEIC, COMEX, MINAE /COBODES, CENADA, INA, Territorial Councils-INDER, Public Universities.

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Target Locations

See what country regions are most suitable for the investment opportunity. All references to Kosovo shall be understood to be in the context of the Security Council Resolution 1244 (1999)
country static map
rural

Costa Rica: Cañas

Between 2017 and 2019, the Chorotega Region counted 22.4% of households below the LP poverty line, of which 5.9% were in extreme poverty (14).
rural

Costa Rica: Cañas

As of 2014, 15.4% of agricultural producers in the canton of Cañas and 11% in the canton of Tilarán were women. At the Guanacaste province level, 16.2% were women (14).
semi-urban

Costa Rica: Cañas

As of 2014, 14.7% of agricultural producers in the canton of Upala were women. In the province of Alajuela, 15.3% were women (14).
rural

Costa Rica: Tilaran

Between 2017 and 2019, the Chorotega Region counted 22.4% of households below the LP poverty line, of which 5.9% were in extreme poverty (14).
rural

Costa Rica: Tilaran

As of 2014, 15.4% of agricultural producers in the canton of Cañas and 11% in the canton of Tilarán were women. At the Guanacaste province level, 16.2% were women (14).
semi-urban

Costa Rica: Tilaran

As of 2014, 14.7% of agricultural producers in the canton of Upala were women. In the province of Alajuela, 15.3% were women (14).
rural

Costa Rica: Upala

Between 2017 and 2019, the Chorotega Region counted 22.4% of households below the LP poverty line, of which 5.9% were in extreme poverty (14).
rural

Costa Rica: Upala

As of 2014, 15.4% of agricultural producers in the canton of Cañas and 11% in the canton of Tilarán were women. At the Guanacaste province level, 16.2% were women (14).
semi-urban

Costa Rica: Upala

As of 2014, 14.7% of agricultural producers in the canton of Upala were women. In the province of Alajuela, 15.3% were women (14).
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References

See what sources were used to establish the investment opportunity’s data and find resources that could be consulted to explore more.
    • (1) MIDEPLAN (2021) Estrategia Económica Territorial para una Economía Inclusiva y Descarbonizada 2020-2050 en Costa Rica
    • (2) Gobierno de Costa Rica (2018) Plan Nacional de Descarbonización 2018-2050.
    • (3) INAMU (2018) Política Nacional para la Igualdad Efectiva entre Mujeres y Hombres 2018-2030, PIEG
    • (4) Asamblea de Costa Rica (1998) Ley 7779, Ley de Uso, Manejo y Conservación de Suelos.
    • (5) Asamblea de Costa Rica (1997) Ley 7064, Ley de Fomento a la Producción Agropecuaria y MAG
    • (6) Asamblea de Costa Rica (1998) Ley Nº 8591, Ley de Desarrollo, Promoción y Fomento de la Actividad Agropecuaria Orgánica.
    • (7) Arce (2019) ANÁLISIS COMPARATIVO DE PRECIOS Y COSTOS DE PRODUCCIÓN DE HORTALIZAS CULTIVADAS DE MANERA ORGÁNICA Y CONVENCIONAL. Revista UCR de Agronomía Costarricense 44(2).
    • (8) Chacon (2019) SITUACION ACTUAL DEL CULTIVO DE CACAO EN COSTA RICA. Oficina Nacional de Semillas.
    • (9) Presidencia (2021) 165 FAMILIAS DE TILARÁN DESARROLLAN HUERTAS CASERAS PARA HACER FRENTE A AFECTACIONES POR LA PANDEMIA. Comunicado oficial.
    • (10) PROCOMER (2016) CHOCOLATE DE UPALA SE VENDE EN EUROPA Y CANADÁ. Comunicado oficial.
    • (11) PROCOMER (2020) Alimentos orgánicos frescos y procesados. Dirección de Inteligencia Comercial
    • (12) PROCOMER (2016) OPORTUNIDADES COMERCIALES PARA LA EXPORTACIÓN DE CACAO. Dirección de Inteligencia Comercial
    • (13) PROCOMER (2020) COVID-19 IMPULSA LA COMERCIALIZACIÓN DE ALIMENTOS ORGÁNICOS. Comunidado oficial.
    • (14) INEC (2019). Encuesta Nacional Agropecuaria 2019.
    • (15) BCCR (2021). Exportaciones FOB Totales por Producto. Matriz de datos.
    • (16) MAG (2018) Plan de intervenciones estratégicas 2019-2022.
    • (17) CATIE (2021). Unidad Bioestadística. Matriz de Datos.
    • (18) CEDECO (2021). Servicios de Investigación de demeanda, oferta y consumo de productos orgánicos.
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