The American Banana Farmer That Funded A Honduran Revolution
By: Tanner Papy
Tags: History, Entertainment, Farming, Entrepreneurship, Business

The American Banana Farmer That Funded A Honduran Revolution

In the late 1800s and early 1900s, bananas were a newfound luxury in the United States. Coming primarily from Central America, they arrived in ships and were found in large American ports such as New Orleans and Boston. As this delicious new delicacy was discovered by more people across the country, it became highly desired, and the demand for bananas exploded exponentially. This caused entrepreneurs such as Minor C. Keith, founder of United Fruit, to capitalize on the newfound desire for bananas and go on to create one of the largest fruit companies in history.

The competition was fierce, however, with countless other banana farmers taking up residence in various Central American countries to try and secure a small percentage of the market share dominated by United Fruit. Most of them would end up being acquired by United, creating one of the largest monopolies in early America at the time. However, one, in particular, would prevail and would go on to be the catalyst behind a massive revolution in Honduras.

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Sam Zemurray

Commonly known as “Sam the Banana Man”, Zemurray was a 33-year-old Russian immigrant with a strong footing in the banana business. He started out as a fruit peddler, taking the ripe bananas thrown out by large fruit companies such as United Fruit, and selling them to people for a fraction of the cost. These slightly ripe bananas were looked at as trash by large companies and Sam was the master at taking advantage of opportunities. So, he saved up some money and started buying them in bulk, directly from the ships, and selling them across the country out of a rented train car.

He made quite a bit of money throughout the process and would go on to become fairly successful. But, this wasn’t enough for Sam and he knew that the real money came from being directly involved in the banana trade, not as a peddler, but as a grower and importer. Thus, he took all of his earnings at the time, along with any other capital that he could acquire, and purchased Thatcher Brother’s Steamship Company.

These dilapidated ships would be used alongside the newly acquired Cuyamel Fruit Company to import bananas directly from Central American farmers and into the hands of the American public. This was a step in the right direction for Zumurray, but it was not his end goal. In order to secure the best possible margins, he needed to do everything in-house. He needed to get bigger and become a banana farmer.

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Vertical Integration

In order to grow bananas in-house and vertically integrate, Sam needed to be able to purchase land to make farms, build railroads, and set up distribution centers. So, he took out as many loans as he could so that he could have the funds necessary to buy land. After securing the capital, he decided on Honduras. Honduras was a perfect region for growing bananas and it was the original location of the Cuyamel Fruit Company that he had recently purchased.

With money in hand, he decided to purchase 5,000 acres along the Cuyamel River and create a massive banana plantation. Hiring countless locals, he developed all of the infrastructure needed to export bananas to the United States. He built railroads, towns, warehouses, and countless other necessities in a trade as complicated as banana farming. On top of this, he paid the locals considerably more money than most other American corporations that were infiltrating Central America and even went on to work alongside his workers in the jungle. This gave Cuyamel and Zemurray a legendary reputation in the region and it would go on to build the foundation for an entire civil uprising within the country.