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Colombia’s Agricultural Sector Severely Affected by A Month-Long of Protests: USDA

By: Diana Delgado, Contractor

Colombia’s Agricultural Sector Severely Affected by A Month-Long of Protests: USDA

Coffee Network (Bogota)- The Colombian Agricultural sector has been severely affected by a national strike and road blockades that complete 41 days, impacting severely the agricultural sector across the board, the US Department of Agricultural said.

On April 28, mass protests erupted across Colombia in response to President Duque's tax reform bill. Despite the bill being withdrawn, the protests and unrest continue and are obstructing the movement of goods throughout Colombia, impeding bilateral agricultural trade, and impacting food prices in the country.

The agricultural sector is sustaining major losses due to road blockades and unrest. The Colombian Ministry of Agriculture estimates economic losses of more than US$ 700 million, due to road blockages and raw material shortages impacting the production and transport of food. Of the 32 Colombian departments, 29 have been impacted by the disruptions in the agricultural supply chain, the US Agricultural Department said.

According to the National Federation of Coffee Growers, in May, over 800,000 60 kg bags worth USD 210 million could not be exported due to difficulties in getting beans to Buenaventura Port.

 In the pork sector, twelve million chickens have died, an estimated loss of US$80 million. Road blockades are impeding food for pork to arrive at farms. The situation is impacting 840 pork farms and 30,000 jobs.

In addition, all sugar plants, located in southwest Colombia, are the most seriously affected region by blockades. Economic losses from the sugar sector are estimated at USD 120 million, putting at risk 286,000 jobs. In the Valle del Cauca river valley, the income of 6 out of 10 families depends on the sugar industry. U.S. agri-food companies that have invested in the Valle del Cauca region have dramatically reduced operations due to severe shortages of inputs and raw materials as a result of road blockages at Buenaventura Port.

Economic impact

One economic think tank estimates that the economic cost of the crisis ranges between COP 4.8 and 6.1 trillion (USD 1.3 to 1.7 billion) in May. Colombian agriculture experienced the most growth of any sector last year, despite COVID-19, but the national protests and blockades have virtually eliminated that success by restricting the movement of agricultural and agro-industrial inputs. According to the Colombian Ministry of Agriculture, economic losses have reached more than USD 700 million since the national strike began. In 2020, the agricultural sector accounted for 6.8% of GDP with 3.3% growth. It also remains a key employment sector, accounting for 18% of the Colombian workforce.

Current Unrest Impeding Bilateral Agricultural Trade

Since nationwide protests began April 28, Colombia has been unable to distribute more than 350,000 metric tons (MT) of grains (including 250,000 MT U.S. grains) from Buenaventura port, due to protests and road blockages. Colombian commodity exports (approximately USD 240 million worth), such as sugar, coffee, bananas, and Hass avocados are also stuck in producing areas.

Road openings at the end of May allowed for a brief uptick, but agricultural producer organizations are concerned that driver shortages driven by fears of attacks will continue to limit the cargo transported into and out of Buenaventura.

According to the Poultry Producers Association (FENAVI), only 40 to 50 trucks of animal feed are reaching consumption centers from Buenaventura while the normal daily requirement is 250 trucks. Despite increasing costs, some vessels with feed grains originally destined for Buenaventura have been rerouted to Atlantic coast ports to supply other poultry and pork producing regions located in Antioquia, Cundinamarca, and Santander.

Agricultural Losses Concentrated in Colombia’s Southwest

Colombia’s southwest, responsible for 30-35% of the country's agricultural production, is the most affected region due to the national protests. Cali, the capital of the Valle del Cauca department and the third most populous city, has been one of the focal points of the protests as it is surrounded by rural areas and poor and weakly governed, and inhabited by ethnic minorities or disadvantaged groups.

Economic impact

One economic think tank estimate that in May the economic cost of the crisis to Colombia ranges between COP 4.8 and 6.1 trillion (USD 1.3 to 1.7 billion). Colombian agriculture experienced the most growth of any sector last year, despite COVID-19, but the national protests and blockades have virtually eliminated that success by restricting the movement of agricultural and agro-industrial inputs. According to the Colombian Ministry of Agriculture, economic losses have reached more than USD 700 million since the national strike began. In 2020, the agricultural sector accounted for 6.8 percent of GDP with 3.3 percent growth. It also remains a key employment sector, accounting for 18 percent of the Colombian workforce.

By Diana Delgado

 

  • Coffee

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