Continue Being Leaders Of The Industry

In the early 1920's something terrible happened in Hawaii, then the world's most important pineapple center. A plant epidemic broke out, devastating the island's pineapple plantations. But from this natural disaster emerged a unique opportunity.

One of the companies whose pineapple farms were destroyed by the spreading plant disease was California Packing Corporation or CALPAK, which decided it was in its best interests to transplant what was once a thriving venture in a more hospitable land. CALPAK sent its agricultural experts to look for the most ideal alternative plantation site around the world. The search brought them across the length and breadth of the Philippine archipelago and ended in the cool plateaus of Bukidnon, adjudged by the team as having the combination of soil, sun and rain perfect for the cultivation of pineapple. Hawaii's loss became Mindanao's gain.

Thus, on January 11, 1926, was incorporated Philippine Packing Corporation, the company established to continue CALPAK's pineapple business. Present in that inauspicious event (no fanfare, maybe no bubbly wine either) were our first president, H.A. White, and the vice-president and general manager, James McNeil Crawford. The latter would become one of our longest-serving presidents, managing our business during some of the most fateful periods of our corporate history - the national economic boom of the early 1920's, the global recession following the U.S. stock market crash of 1929, the Second World War, and the post-war recovery and rehabilitation of the country and the Philippine pineapple industry. For him we named one of our biggest agricultural camps, Camp JMC, in Manolo Fortich, Bukidnon, now home to many of our agricultural employees and their families.

Our company was born in the middle of American colonial rule in the Philippines. In 1926 the Philippine Governor General was a man named Leonard Wood and the President of the United States was the Republican Calvin Coolidge. The country's population of that year is not known. But a census taken by the Americans in 1918 placed the Philippine population at 10,314,310 and the next census conducted by the Philippine Commonwealth Government in 1939 put it at 16,000,303 - according to historical data from the National Statistics Office in Region 10. The Philippine population in the middle 1920's should therefore be anywhere from 12 to 15 million, or just around a fifth of our country's present population estimated at 75 million.

Cagayan de Oro in those days was called Cagayan de Misamis, a name given by the Spaniards to this “settlement by the river” in the 1800's, which stuck until June 15, 1950 when President Elpidio Quirino signed a bill introduced by Misamis Congressman Emmanuel Pelaez creating the city of Cagayan and substituting “de Oro” for “de Misamis.” Bugo in the 1920's was a sleepy rural fishing village.

Little did our corporate forebears know that they were planting the seeds of what was to become one of the most important and successful industries here in the Philippines. Between 1930 and 1935 we were exporting on the average only around 2 million kilos (2,200 tons) of pineapple products per year to the United States, then our only offshore market. That's a drop in the bucket by today's production standards considering that in 1998 alone we sold more than 530,000 tons of canned and fresh fruit products in four continents.

Today our company is also Northern Mindanao's largest exporter of processed food and fresh fruit, according to the Department of Trade and Industry in Region 10, with more than a third of all processed food exports from the region coming from our cannery. According to the same source, pineapple has continued to be one of the country's top 10 processed food exports for the past 25 years.

Commercial planting of pineapple seeds transported from Hawaii began in 1928 in Santa Fe, Libona, Bukidnon. A year later Acting Governor General Gilmore, on the recommendation of the Department of Agriculture and Natural Resources, signed a proclamation declaring 14,052 hectares of land in Libona as the Bukidnon Pineapple Reservation.

Bugo Cannery opened on June 30, 1930. It cost $750,000 or 1.5 million Pesos to build (the exchange rate in the olden days was 1:2). We began exporting pineapple juice and sliced pineapple that year to the United States. In the early 1930's, however, our country and our business began to feel the effects of the world recession triggered by the Wall Street Crash of 1929, forcing the cannery to shut down in 1933 and the plantation to lay off most of its workers.

When the Philippine Commonwealth was inaugurated in 1935, the national and global economy had started to rebound. President Manuel L. Quezon visited our cannery in 1937 and met with company officials. Quezon was impressed by what he saw. On August 15, 1938 he wrote a message to the National Assembly informing the body that, because of our company's outstanding contributions to national economic development, he had issued an executive order leasing public lands in Tankulan (now Manolo Fortich) to the National Development Company, then the government's economic arm, on condition that it enter into an agreement with Philippine Packing Corporation for the further development of the pineapple industry. About a year later Quezon issued a similar order covering public lands in Libona. Quezon cited “employment for over a thousand people” as one of our company's most notable achievements (today our company employs more than 5,700 workers). Ownership of most of these former NDC lands has been transferred to DEARBC, the agrarian cooperative composed of current and former Del Monte employees, in accordance with the Comprehensive Agrarian Reform Law. DEARBC has leased them back to Del Monte.

World War II devastated our business. Reconstructing our agricultural and industrial base was a massive effort. There was nothing much we could salvage in the cannery. But not everything was lost. Many pineapple plants had miraculously survived the war and years of abandonment at the plantation. They provided the slips used in the replanting which began in 1946. In 1948 we completed rebuilding the cannery just in time for our first post-war harvest. Our company sought compensation for damages sustained during the war. The U.S.-Philippine War Damage Commission awarded us the amount of 1,762,392.79 Pesos (a hefty sum in those days) given in two tranches: the first in 1950, and then in 1951. At about this time pineapple became one of the country's 10 principal exports.

The next half-century was a period of growth and expansion which saw the company leave an indelible mark (the Del Monte trademark) in the world's consciousness as a producer of quality food and beverage.

In 1959 our company's main office moved from Bugo to Pasong Tamo, Manila. That same year we set up the feedlot at the plantation with the initial herd coming from Sindangan, Zamboanga. The following year we made our first livestock shipment to Manila - 656 head of cattle or more than 277,600 pounds of excellent beef material. And three years later, in 1963, we broke new grounds by introducing new products, among them processed fresh tomato, the precursor of our current tomato-based products (e.g., tomato catsup and tomato sauce), and tropical fruit cocktail.

In 1965, Luis F. Lorenzo, Sr. became the first Filipino to be appointed Del Monte Plantation Manager. (Chi tong, as he was fondly called by friends, would surpass this historic feat 31 years later when he was elected Chairman of the Board of Del Monte Philippines, Inc. after Filipino stockholders acquired the majority shares in 1996.) He organized the Barrio Assistance Program in 1967, a medical and economic outreach effort to help neighboring communities around the plantation help themselves. This altruistic tradition continues today in Bukidnon, Misamis Oriental and Cagayan de Oro City through scholarship, livelihood skills, health education, and family welfare programs under the auspices of Del Monte Foundation.

The 1970's saw our company diversify its business. We introduced new products including a variation of the fruit cocktail and three tomato products. In 1979 we became part of the RJR global business. In the early 1980's Nabisco bought RJR and we became part of the RJR-Nabisco empire. And in 1988 RJR-Nabisco sold all of its business to a subsidiary of KKR - Kohlberg, Kravis, & Roberts - in what “Time Magazine,” in a cover story, touted as the biggest leverage buyout of the century. It was in 1987 that our company took the dramatic step of renaming itself Del Monte Philippines, Inc., in deference to our trademark whose reputation for excellence had preceded us around the world for more than half a century. And in the same year, to be closer to the source of our business and render greater service to our host community, we had our corporate headquarters relocated from Manila to Bugo, Cagayan de Oro City.

A historic event unfolded in 1996, which left a most profound impact on the life of Del Monte. For the very first time in our history, Filipinos gained control of our company; for the first time Filipinos took the helm of corporate leadership. This milestone came at a time when we were being buffeted by the strong and merciless winds of change - the challenge posed by new pineapple powers Thailand and Indonesia and, a few years later, the Asian economic crisis. Led by Luis F. Lorenzo, Sr., the new management clarified the vision (to be Asia's premier food and beverage company) by whose light our company must be guided as it approached the end of one century and the beginning of another.

We have crossed that threshold of time confident not only that we can survive any serious challenge to our business but also continue being leaders of the industry. And why not? We have the world's most important and successful pineapple production sources, our plantation and cannery. We have an effective, aggressive and trail-blazing sales and marketing organization. We have some of the most competent and dedicated professionals in our finance, management information services, engineering, supply-chain management, research and development and human resource management teams. We have leaders who believe in “growing our business and our people.” We have teams powered by people who possess all the great skills - intellectual, technical, and emotional - and who have shown loyalty and devotion to our company even during the most trying times. And we have time on our side: new technologies, new ideas, and new successes.

Del Monte's pilot plant now accommodates trial runs for new products packaged in stand-up pouches. The plant, located in Las Pinas, Metro Manila, was built at the cost of $5 million. Its processing lines are capable of testing hot-fill flexible pouches and producing samples for shelf-life studies. Now managed by the Tollpack Management and Product Development Services group under Sr. Mgr. Tiny dela Paz, the plant makes easy in-house testing of products before commercial production in tollpacking facilities in Metro Manila contracted by the company. Del Monte products in stand-up pouches include catsup, tomato sauce and spaghetti sauce. Gracing the plant's ribbon-cutting and inaugural rites was DMPI President Alex Castillo. Cannery Operations Vice-Pres. Bert Mabilangan, Tollpack and Quality Assurance manager Bing Pilobello, New Product Development manager Luz Boyonas, and Process Development manager Ariel Reyes, Corp. Supply Chain Management Vice-Pres. Binky Elicafio and Corp. Human Resource and Corp. Affairs Vice-Pres. Jimmy Ong.

The Name

he brand name “Del Monte” is probably among the world's oldest brand names. In fact, the name has graced grocery shelves for over a century now. The “Del Monte” label first appeared in the early 1900's on bottled tomato products produced by a small agri-processing company based in California in the United States. A Spanish term meaning “of or from the mountain,” this brand name, even then, had the makings of a grocery favorite.

In 1916, Del Monte's tomato manufacturer and three other West Coast canning companies whose origins date back to the 1850's, combined to form California Packing Corporation. And Calpak did not miss noticing the market following of the new Del Monte brand, acquired along with its holding company.

Other than tomato, Calpak vigorously ventured into other agri-crops, and established its own pineapple plantation in Hawaii. A major pest infestation at its Hawaiian plantation started the company on a search for other plantation sites across the globe. Trial plantings in Latin American and in the Philippines finally led to the incorporation of Philippine Packing Corp (Philpak) in Bukidnon in 1926. The San Francisco-based Del Monte Corporation was the descendant of Calpak and the four West Coast pioneers. DMC also later managed agricultural and manufacturing operations in its various affiliates and subsidiaries worldwide, including Philpak.

This imported hybrid crop is cultivated on the highland plains of five towns of Bukidnon, some 2,000 feet above sea level, on the foothills of Mt. Kitanglad. It remains Northern Mindanao's top agri-based export item, both canned and fresh, shipped out to four continents circling the globe. Along with pineapple products, this famous brand name is now carried by a growing list of tomato-based, beanbased, pasta and other food products.

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