Colombian agriculture in times of a pandemic

In this article you will find a summary of effects of COVID-19 in Colombian agriculture, as published in  the magazine of the National Association of Farmers ( SAC)  in April 2020.

Colombian Seed Association - ACOSEMILLAS

The sector has experienced increases in costs for inputs such as fertilizers and agrochemicals. This might lead to  lower profits and therefore lower investment in the next planting season.

Regarding logistics, land transport took more time, apart from the fact that it has not been easy to establish logistics for evaluation tests of new varieties and hybrids, due to the difficulty of mobilizing personnel in the field.

Regarding the impact of lockdown, difficulties have been identified regarding providing technical advice, which has been restricted to strict visits, with telephone support and virtual training.

The reactivation challenges are related to  crop storage infrastructure;  adoption of high-performance hybrids and import substitution. There is a need for  government programs which are aimed at increasing the technification of the corn sector to generate a self-sufficiency plan for national consumption.

Colombian Association of Flower Exporters - Asocolflores

COVID had a major impact in this sector;  exports have been reduced by more than 80% and this creates a big impact on the entire floriculture production chain. The crops are currently producing  at less than 50% of their capacity. The main concern for the association is to protect the health of workers while ensuring the survival of crops and maintaining 140,000 formal jobs.

For this year, sales of more than US $ 1.5 billion were estimated, a figure that is clearly not going to be met because sales in the first half of the year have been severely adversely affected by the pandemic.

The association says that at this time it is not possible to speak of the real impacts that the Coronavirus will have on the sector, but if one thing is certain it is that there will be huge  economic consequences that they are foreseeing for exporters and for flower production.

Colombian Banana Association - AUGURA

One of the biggest challenges is to continue the banana export activity, mainly to Europe and the United States . Whiletaking into account that bananas are the third export product in the country, which generates 35000 formal jobs and 100,000 indirect jobs. The sector is working hand in hand  with agro-industry companies and with the national government.

As for the side effects, the suppliers stuck to the prices before the pandemic.  As for April however the prices of fungicides and other fertilizers will probably rise. These products can represent approximately 30% of production costs.

Additionally, the banana sector is being impacted by the high prices of paper, which is used in the production of cardboard boxes where bananas are packed. Both fertilizers and paper are imported, so costs rise according to the exchange rate.

National Federation of Cocoa Growers - FEDECACAO

The industry works relatively normal and given the importance of chocolate in national consumption, the federation mentions that the supply of the raw material has continued in the main producing areas of the country, complying with COVID prevention measures.  Fedecacao in turn kept on buying cocoa, to ensure continuity in the chain income for producers. However, there was a drop in the price per kg of cocoa associated with the exchange rate. An interruption in the chain could affect this sector and thus shortage in the medium term might arise, affecting primary producers who obtain their livelihood from the sale of cocoa  on a daily basis.

National Federation of Oil Palm Growers - FEDEPALMA

The palm oil sector has taken the necessary prevention measures to continue production and preserve the employment and income of more than 184 thousand workers.

Among the main difficulties the sector has faced at this crisis are: storage deficit; challenges in commercialization due to the decrease in the demand and import of palm oil; security problems due to threats from armed groups in some areas and restrictions in transportation.

The Federation has asked the national government to/for : temporarily ban imports of palm oil and increase the biodiesel blend to B12; price stabilization/minimum price; increase public purchases of palm oil, instruments to achieve greater storage, and financing for the sector to have greater liquidity.

National Federation of Poultry Farmers - FENAVI

Poultry farming is today facing an unexpected market reality. On the one hand, the egg sector, despite registering a growth rate of over 10%, faces an atypical growth in demand, which has allowed it to transfer the impact of higher production costs generated by devaluation of the peso. On the other hand , in broilers, due to the lockdown, demand has dropped by 35-50%.

The Federation highlights three fundamental achievements with which it intends to cope with this crisis. Firstly, the development of a preferential line of credit aimed at small, medium and large producers. Secondly, the request for VAT refund, which was achieved jointly with other associations to seek greater liquidity/ And thirdly  the suspension of the Andean Price Band System (SAFP) for imports of yellow corn, sorghum and soybean complex until June 30 of this year, fixing a tariff of 0% on these goods. This measure guarantees an alternative supply source of raw materials for balanced food, at no fiscal cost to the State and without altering the structure of national production.

National Association of Pork Producers - Porkcolombia

Pork meat sales have decreased 25-70% mainly due to the cancellation and reduction of orders and the impact on consumption due to the sharp decrease in the purchasing power of Colombians.

As a consequence, the pig farmers have been forced to retain more animals on their farms, gaining weight and assuming an additional cost in feeding, and this generated a large outflow of animals as commercial liquidation at low prices, which caused a drop in price of 12.13%, the largest since 2001.

It is evident that the situation is delicate and mainly affects small and medium-sized pig farmers, who do not have integration levels to bring their product to the final consumer, nor cold infrastructure to store the product.

The association highlights that it is necessary to find mechanisms to mitigate the impact of this economic crisis, or else in a few weeks the economic and financial viability of the pig activity can be compromised, with the serious consequences of this for the country's food security and for the 500 thousand Colombians who live from pig farming.

Corona
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