Argentinian fruit exports fall to alarming levels

Argentine fruit exports have declined drastically in recent years, deepening the sector's crisis. The figures reflect a 22% year-on-year decrease in exports and the volume exported to overseas markets was the smallest one in the last 25 years. In the first four months of the year the country only shipped 123,000 tons of pip fruit, while in the same period of 2005 Argentina exported 400,000 tons of these fruits.

According to a recent study carried out by the North Patagonia Port Terminal (TPPN), in the first quarter of 2019 the country shipped out 102,000 tons of pears, i.e. 21% less than in the same period of last year. Apple exports reflect the same trend, with an approximate sales volume of 20,000 tons, 24% less than in the previous year.

The problem is even more serious considering the closure in February of the Brazilian border to Argentine pip fruit due to carpocapsa problems.

The external sales figures show the critical situation that the activity is undergoing, with a loss of competitiveness and without sufficient levels of profitability to be able to reinvest in the system.

This scheme is unsustainable for companies in the sector in the short and medium term. The companies have little margin to react and, in addition, have to pay high government taxes on exports. The economic instability that is causing this situation makes it impossible to obtain financing through the local banking system, and fruit companies find it increasingly difficult to maintain the pear and apple export businesses.

An example of this unfavorable scenario for the business sector is Ecofrut, which went into bankruptcy several days ago after not being able to meet its commercial and financial commitments, leaving debts of more than 450 million pesos, as declared by its directors in the judicial file.

The banks are already reacting to this. Many are requesting cancellations of loans or refinancing in shorter periods than those that had been agreed on. On the other hand, the commercial chain is the one that ends up adjusting in this scenario, as it faces the latent risk of a cut in the payments chain.



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