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  HOME | Latin America (Click here for more)

PepsiCo, a Giant That Rewards Sustainable Latin American Agriculture

MONTERREY, Mexico – In the Mexican state of Nuevo Leon, 2½ hours by road from Monterrey with altars and cactus dotted all along the way, is La Soledad, a ranch repurposed to grow potatoes and which is helping to develop an Agriculture 4.0 model for Latin America.

“Over the past 15 years, we have dedicated ourselves to breaking paradigms,” EFE was told by its owner, Francisco Chapa, in reference to the date that his AgroJaba company signed a contract with food and drink giant PepsiCo to supply it with potatoes, but also to “learn to unlearn” what he knew about agriculture.

Chapa bought the 5,000-hectare (12,000-acre) ranch, now planted with root vegetables that grow in the sun, are protected by the Sierra Madre mountains, and whose underground development he knows very well: the harvesting process lasts 120 days, but many factors can change the result.

He masterfully cut a potato to see its bright white inside; it’s one of the company’s industrial varieties, the fruit of four years of research and which he waters in trickles, the most costly irrigation technique but the most efficient for saving water.

“Agriculture is responsible for 70 percent of the world’s water consumption,” said the director of PepsiCo’s processed-food business in Latin America, Arturo Duran, who supervises the application of the company’s ambitious Sustainable Agriculture Program, based on economic, social and environmental performance factors.

Included among its objectives is the reduction of the carbon footprint and training its associated farmers in best practices of storage, irrigation, nutrition and standards for their employees, until all of the above is certified.

PepsiCo has been certified as using “sustainable sourcing” for its products, and the potatoes it uses live up to that promise 100 percent, as the company Chairman and CEO Ramon Laguarta said in a sustainability report last September.

“Farming practices have been around for many years, but it doesn’t mean we can’t change them,” Duran said, adding that several times a year farmers and executives travel to avant-garde croplands around the world, then share what they learned at an Agro University created by PepsiCo.

“We want a single Latin America,” the director said about his suppliers, who replicate the most sustainable agricultural models for the different crops and climates in the region, so “the ultimate winner is the country” that makes use of this new knowledge.

AgroJaba, one of the 20 suppliers of potatoes to PepsiCo Mexico – which makes the Sabritas line of snacks and particularly potato chips – has gone from producing 800 tons annually to some 27,000 tons, driven by the alliance with the number one industrial purchaser of that root vegetable, which obtains a total of approximately 280,000 tons a year.

Despite the success of his business, “if we don’t do something, we won’t have many farmers left,” said Chapa, who is betting on the Agriculture 4.0 model in which technology is not only used in a way that is “corrective, but also predictive,” so it can keep up with events as they happen.

Established in Latin America a century ago and aware that agriculture is “the basis of the food chain and of the business,” PepsiCo has set as its goal for 2020 to have all its raw materials coming from the countryside certified as sustainable, and, for 2025, to reduce by 15 percent the use of water for irrigating croplands.


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