Colombia Agribusiness Report Q2 2016
BMI View: Colombia's agribusiness sector is being held back by a number of deep structural challenges -including the lingering consequences of internal armed conflict, structural inefficiencies, lowcompetitiveness and poor policy choices. As a result, area cultivated and yields have stagnated over thepast decade. But after several decades of disappointing growth in Colombia's agribusiness sector, theoutlook for production and exports is brightening. The efforts made to resolve the conflict, coupled with thepotential for upcoming agricultural reforms, have paved the way for the revival of Colombia's agribusiness.
The coffee, fruits, sugar, palm oil and horticulture sectors offer the best opportunities. Colombianagriculture enjoys a large diversity thanks to abundant natural resources and diverse climates andtopography. Although FTAs may undermine the livestock and dairy sectors, they also provide Colombiawith large export markets. The US and EU, which are the main markets for Colombian agriculturalproducts, will see their imports grow in the coming years with the decrease in tariffs.
Corn consumption growth to 2020: 18.4% to 7.1mn tonnes. Corn consumption will expand at a fasterpace than production over the medium term, boosted by the growth in the livestock sector, especially inthe poultry segment. The domestic corn deficit will reach 4.75mn tonnes by 2018/19, compared with3.95mn tonnes in 2013/14.
Poultry production growth to 2019/20: 26.4% to 1.8mn tonnes. Poultry will record the strongestgrowth within the livestock sector over the coming five years, supported by a growing domestic demandfor meat products at affordable prices.
Coffee production growth to 2019/20: 11.3% to 14.8mn bags. Programmes to replace agingplantations and improve resistance to disease are starting to bear fruit and will support yields and lead toapick up in planted area in the coming years. The various FTAs signed over recent years with the US,Canada and the EU will provide Colombia with large export markets.
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