Argentina: Canned peach sales to Brazil down 62%

A study by the economic consultant Cuyotrend reveals that canned peach exports to Brazil, main destination for this product (last year it received 58% of all exports), fell between January and August this year by 62% compared to the same period in 2011, which gives an idea of the difficult situation for agricultural exporters in Mendoza, Argentina.

The study also indicates that during the first eight months of the year, the total number of exports for this product fell by 45%, meaning that the situation is even worse than in 2009, when exports also fell sharply due to adverse weather conditions.

Negative comparison

The report notes that between January and August this year 155,503 boxes of canned peaches arrived in Brazil (each box containing, on average, 24 cans of 850 grams), when in the same period in 2011 the number of boxes shipped was 407,136.

But the situation can also be observed for other destinations. Uruguay, for instance, received 39% less canned peaches, Mexico 36.5% less and Venezuela 48.3% less than what was imported in the previous year.

Bolivia also received fewer exports this year, although in a lower percentage (-6.8%), and while exports improved in some countries, like Paraguay (+5%) and Colombia (+90%), their volumes are insignificant in comparison with the total sold worldwide.

Another remarkable statistic is that "other destinations" received 90% fewer cans than in 2011. Although taking into consideration the evolution in the past eight years, the sector went from exporting around 680,000 boxes to these other countries in 2004 to just barely 1,019 in 2012.

It is true that at that time many markets appeared to be growing rapidly; in fact, Brazil emerged as the main destination, but it is also clear that other truly relevant markets were being lost, such as Mexico, where 240,000 boxes were arriving in 2004, while in 2012 that number went down to just 4,500.

Cuyotrend has also noticed this progressive disappearance of markets, as in the beginning of the period, Mendoza, which produces 99% of the country's peaches, was selling cans to 42 countries, while now that number is down to 11. 

Origin of the problems 

There are several explanations for both the economic situation and the negative evolution in the period 2004-2012.

According to Cuyotrend's economists, in previous years "the peso devalued by 50% against the dollar; also, while the international price of cans improved by 65%, production costs grew by 200%." This way, competitiveness in the sector was reduced by 40%.

Regarding the situation, experts attribute the problems to "Brazilian retaliation against Argentinian barriers", which ended up stopping "almost completely" all exports to that country.

Representing the producers, Carlos Quinteros, manager of the Federation for Industrialised Peaches (Fedepi), considers that the report "perfectly" describes the situation that the sector is going through.

Meanwhile, representing the exporters, Mario Bustos Carra, manager of Cuyo's Foreign Trade Chamber, said that the problems affecting the processed peach sector are part of "a bigger picture" in which many different agribusinesses are involved.

"This is the consequence of a faulty export policy," highlighted the leader, who again made the claim: "It is necessary to have a national policy for foreign trade, to avoid these shortcomings which increasingly affect our regional economy," concluded Bustos Carra.

Source: Losandes

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