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Read more of our interview with Dr. Robert Gwynne commenting on changes in Chile.

When we filmed in 1994, we interviewed the Sadpeda family, and the Sadpeda family were basically four brothers who had managed to expand their production area from approximately 200 hectares to 800 hectares. The Sadpeda family had, within the group, there was a banker, a farmer, a lawyer; they sort of formed a quite unique combination. And when we talk to them, [as] they explained it, they had invested in further land up the valley, which is where we interviewed them, in their lands high up in the valley, not down in the valley. High up in the valley because that is where the highest insulation is, where the highest amount of heat is and where you produce the earliest table grapes. And you get better prices for early table grapes harvested in November than you do for the later on, which is down in the valley, near the Pacific coast. The Sadpedas were a very entrepreneurial family. They had approximately $2 million in debts. So they were having quite substantial debts, but their income was so large that there was no problem for the banks to keep on lending them money. And they were continuing to expand and become one of the largest producers and exporters of table grapes from the Norte Chico.

It's very important for these producers to expand and to generate increasing economies of scale and to have better global networks of supply so that they can, for example, cut out the middle intermediaries, and negotiate directly with supermarket chains in the United States or in the United Kingdom. That is where they are able to reduce the transaction costs of exporting table grapes, which the small producers cannot do, because they have to rely on intermediaries, which take larger and larger proportions of the value added from the point of production to the point of sale. For example, in 1994 the farmers were getting an average of $10 a case for a case of table grapes. These were being sold in the United States or the United Kingdom for about $40 a case. So there was that $30…[going to] the intermediaries and the supermarkets. So the more you can get of that $30, the more profitable it becomes. And the large-scale producers can do that, but the small-scale producers cannot; they have to rely on the international fruit companies or the Chilean fruit companies to do that.