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The drop in sales and possible deficit is not due to lower consumption of guaro but due to an oversupply of the spirit in the market and the competition selling the Cacique at a lower price than the Fanal.

Jorge Orozco, manager of the Fanal says that sales for the first half of this year is only 960.000 litres (80.000 cases of 12 litre bottles) instead of the 2.16 million litres (180.000 cases) it should have sold, which will lead to a shortfall of ¢1.5 billion colones by the years end.

The problem is due to two factors.

The first reason is that Ciamesa, the former distributor of Fanal, stocked up last year an inventory of 100.000 cases of the Cacique and now is selling it off prices below the Fanal prices.

The second is the enttrance of other guaro and "aguardiente" products in the market, giving Cacique competition.

While a 365mm bottle of Cacique produced locally sells for between ¢1.700 and ¢1.900, other brands of guaro sell for between ¢400 and ¢700 colones.

As to Ciamesa, it sell a litre of Fanal produced Cacique guaro at a wholesale price of ¢2.700 colones, while Fanal sells for ¢3.000 colones.

"We don't know how they can sell so cheap", said Orozco.

This has a negative impact on the Consejo Nacional de Producción (CNP) - the government distiller - and owner of the Fanal who has seen its revenues drop from ¢250 million colones monthly to ¢100 million, as its star producer struggles with lower sales and competition.