Monday, Jun. 03, 1991

Business Notes

His family has farmed the same tiny plot of land in the Guatemalan highlands for generations, but Jacobo Mendez is the first to reap riches from a most unlikely source: "baby" zucchini. Far to the north, novelty-loving Americans are willing to pay seven times the price of the full-grown product for its freshly flowered miniature equivalent. Mendez doesn't care why -- he's just glad they do. "I have my own house now, and we all eat better," says Mendez, 34, a Cakchiquel Indian descended from the Mayans, who ruled the region a thousand years ago.

Long familiar to French chefs, baby vegetables are a growing business across the Atlantic. Upscale restaurants are increasingly partial to downsize squash, zucchini, carrots, lettuce and green beans. The stateside craze means Guatemalan gold. A year-round growing season, rich volcanic soil and high- altitude geography give the impoverished nation a significant edge in the U.S. winter-vegetable market, as indicated by last week's crowning achievement: a party for Britain's Queen Elizabeth in Houston, where Guatemalan baby squash and pineapples the size of softballs were on the menu. Yet back in Central America, no one would dream of actually eating the stuff, which is grown strictly for those loco gringos.