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Venezuela Agribusiness Report Q2 2016

Venezuela Agribusiness Report Q2 2016

BMI View: The operating environment for the agribusiness sector has deteriorated significantly over recentyears, due to the poor macroeconomic climate, a shortage of foreign currency for input purchases andgeneral government mismanagement. Venezuela's economy will continue to be under extreme downwardpressure in 2016 amidst low international oil prices. The growing headwinds to the economy will weigh onagricultural production and consumption in the coming years, and we forecast most of the commodities tostagnate out to 2020. Producers of agricultural goods will struggle as rising production costs andcontrolled prices at the farm level reduce margins. As such, the divergence between Venezuela and itsneighbouring countries in terms of agricultural sector development will continue to grow in the comingyears.

Key Forecasts

Coffee production growth to 2019/20: 7.2% to 536,000 60kg bags. Venezuela's coffee sector suffersfrom many structural weaknesses and is on the decline. Low profitability (due to government-mandatedprices), the lack of private and public investment and rust disease will impede production from growing.

Poultry production growth to 2019/20: -5.2% to 578,000 tonnes. The sector is held back by a lack ofprofitability due to high input costs, inflation and government price controls, along with increasedcompetition from imports. The poultry industry will fare somewhat better than the beef sector, for whichthe outlook is especially bleak.

Corn consumption growth to 2020: 4.6% to 3.8mn tonnes. Grains consumption is also feeling thepinch of economic woes and the decrease in foreign exchange, as Venezuela encounters problems withimporting grains. Demand in the medium term will remain lacklustre, amidst low domestic grains supplyand the weak growth in the livestock sector.

2016 BMI universe agribusiness market value: USD26.63bn (down 2.6% from 2015; forecast to growannually by 1.7% on average from 2016 to 2020).

2016 real GDP growth: -6.2% (up from -7.5% expected in 2015; forecast to grow annually by 0.4% onaverage between 2016 and 2020).

2016 consumer price index: 252.9% y-o-y (up from 116.2% expected in 2015; forecast to growannually by 133.2% on average between 2016 and 2020).


BMI Industry View
SWOT
Agribusiness
Industry Forecast
Grains Outlook
Table: Venezuela - Grains Production And Consumption Outlook
Table: Risks To Outlook
Table: Grains Production & Consumption (Venezuela 2013-2020)
Coffee Outlook
Table: Venezuela - Coffee Production And Consumption Outlook
Table: Risks To Outlook
Table: Coffee Production & Consumption (Venezuela 2013-2020)
Livestock Outlook
Table: Venezuela - Livestock Production And Consumption Outlook
Table: Risks To Outlook
Table: Livestock Production & Consumption (Venezuela 2013-2020)
Table: Beef Production & Consumption (Venezuela 2010-2015)
Commodity Strategy
Global - Global Commodities Strategy
Table: Select Commodities - Performance And BMI Forecasts
Upstream Analysis
Americas Machinery Outlook
Table: Select Companies - Sales Forecasts By Region (Company-based estimates)
Americas GM Outlook
Americas Fertiliser Outlook
Downstream Analysis
Food
Latest Updates
Structural Trends
Confectionery
Regional Overview
Table: TPP - Main Winners And Losers For Agriculture
Competitive Landscape
Table: Venezuela Agribusiness Competitive Landscape
Demographic Forecast
Demographic Outlook 2015
Table: Population Headline Indicators (Venezuela 1990-2025)
Table: Key Population Ratios (Venezuela 1990-2025)
Table: Urban/Rural Population & Life Expectancy (Venezuela 1990-2025)
Table: Population By Age Group (Venezuela 1990-2025)
Table: Population By Age Group % (Venezuela 1990-2025)
Methodology
Industry Forecast Methodology
Sector-Specific Methodology

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