Chile: What is needed to be an agri-food power?

For years, specifically since the first government of Michelle Bachelet, there has been a constant talk that Chile must become an agro-food power.

Exactly one year ago, in May of 2014, the Minister of Agriculture, Carlos Furche, interviewed by El País, of Spain, answered the question about what objectives are set at the head of the Ministry:

"Our first objective is to give priority to work with small and medium-sized agriculture. President Bachelet has pointed out that Chile's main adversary is inequality. In the agricultural sector it is evident the difference between small and medium farmers with respect to the larger ones in access to services that allow them to develop their productive processes.Together with this objective we have also defined the need for national agriculture to make a qualitative leap, be able to add value and allow it to position itself in a more advantageous manner in international markets. Chile is not and will not be a major producer of commodities. Our best possibility is the production of healthy foods, based on our Mediterranean climate and on the wide network of commercial agreements that we have".

And indeed, agriculture has developed doubling its economic importance for the country.

We live to export

For 15 years ago the agricultural industry has focused on export to gain a foothold in the world, where Chile "it only represents the 0,3% of the economy", According to Andrés Rebolledo, the new general director of International Economic Relations of the Government of Michelle Bachelet.

"The country's challenge is to exit its exports concentrated in copper", Admits Rebolledo.

And this is how the agri-food sector enters the scene and is emerging as part of the solution. Chilealimentos foresees that of the US $ 37.000 million that today total food sales in Chile, "in ten years we can reach US $ 60.000 million", Says Guillermo González, manager of the entity. In your opinion, "the food industry will represent more than copper for the Chilean economy. It is one of the sectors with the best prospects".

According to Paiva, of Prochile, the advantages of Chile before the foreign investors of the agri-food sector are "its innocuousness, since it is a plague-free country; its political stability and its low corruption".

"We live to export"Says Andrés Rodríguez, president of the Chilean Prunes and Chilean Walnut business associations. The 95% of the production of nuts goes abroad, because in the domestic market these foods are not daily consumption, he explains.

The 90% of blueberries are also sold abroad, in fact Chile is the world's leading exporter of these fruits, but as with other products, they are generally sold abroad in bulk, which means that the prices that are paid because they are lower and the perception of quality is not as high as it should be. It is a complaint of almost all agricultural entrepreneurs.

The second national export industry, which has shown a growing and constant rhythm, has the conditions to break the dependence that we as a nation have on copper, what we lack and where we are highly competitive ?.

Chile, agroalimentary power dream or reality?

Chile has many conditions to be it, such as enviable natural and administrative phytosanitary barriers that allow the development of practically any agricultural, fishing or forestry product, and that also offers production in off-season with the northern hemisphere, which concentrates the world's wealth and therefore offers an excellent opportunity of business.

Although the production of processed foods is one of the largest industries worldwide, its composition is characterized as an activity of medium and small companies. Most of the food we consume daily is unknown to its producer.

In short, it is an industry where small producers have a certain possibility of participation. It is also an item that becomes increasingly more complex. The consumer demands a healthy diet and that their production respects the environment.

The concept of food power in Chile is limited to placing products of high quality and essentially natural production on the international market.

In general, because the consumer does not have the ability to identify the composition of the product they consume, they endorse the responsibility to the State and this turns the food industry into a highly standardized and regularized one, with a growing trend in this regard.

The natural productive wealth of our land and sea allows us to produce well above what we consume, but like the mining industry our weakness lies in the lack of added value and the limited culture and nutritional identity. Salmon, blueberries, plums, oysters and a variety of fruits and healthy foods are not part of the Chilean diet or its culture.

The concept of food power is limited to placing on the international market products of high quality and essentially natural production. For the 2013, the national food production reached US $ 37.500 million, of which 56% was consumed internally and the remaining 44% was exported, that is, close to US $ 16.500 million; as a reference, copper exports reached the sum of US $ 36.500 million. With these levels, Chile would occupy the 26º place according to the total value of sectoral exports, but if the per capita value approach is considered, it occupies the 14º. If you compare this position in the ranking with that of the country's direct competitors at the hemispheric level, such as Australia and New Zealand, they have higher positions. At the regional level, Chile is located on Brazil and Argentina.

Thanks in large part to the 21 commercial agreements signed with 58 countries, Chile has been advancing in most of the products it commercializes. In 2003, 11 products exported by Chile were among the top three worldwide.

Currently there are nine products that achieve number one in the world, as many in the second and third place, adding a total of 23 non-cash shipments that are in the first three places, according to a report prepared by ProChile.

In spite of the benefits and opportunities that the FTAs ​​allow and the active role that the State has played in the development of the industry, they do not solve the problems of the situation on their own, since in general they do not incorporate small and medium-sized agriculture that require investment, technology and management.

There is a need for the public sector not only to open doors in the markets, but to accompany the private sector in the development of commercial opportunities; finance research and development; make a powerful promotion abroad; Implement adequate transportation infrastructure and connectivity, and support the sector through targeted promotion policies.

 

Source: Minagri / Elpais.com

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