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Decline in Chile's Agriculture Sector

13 June 2013

USDA Foreign Agricultural Service

CHILE - Agriculture is an important driver for Chile’s economy. Chile’s annual agricultural exports over the last four years have consistently surpassed $8 billion, representing six per cent of the country’s GDP.

The agriculture sector employs nearly twenty five percent of the national labor force. This year, the National Society of Agriculture (SNA by its initials in Spanish) reports that only two of the main product sectors are projected to grow in 2013. SNA has requested that the government implement measures immediately to promote the competitiveness of the agricultural sector.

The President of the National Society of Agriculture (SNA), Patricio Crespo, projected that productivity in the agroforestry sector will fall by about one per cent this year due to loss of competitiveness and new weather patterns due to climate change.

According to SNA, returns will fall in four of six production areas: vegetables (- 4.6 per cent), fruit (- 6.5 per cent), wine (- 2.1 per cent) and livestock (- 1.0 per cent). The only products with positive projected growth are: forestry (3.8 per cent) and row crops (6.4 per cent). In 2012 agriculture’s contribution to Chile’s GDP fell by 0.6 per cent, meanwhile in the first quarter of this 2013 the Central Bank has already recorded a fall of 1.8 per cent.

The Chairman of the SNA attributed the loss of productivity to the rise in production costs and the drop in the exchange rate.

"I urge the government to implement measures that will allow farmers to deal with this phenomenon," said Mr Crespo. He also stressed the need to unlock energy investment and improve water infrastructure to ensure dependable access to irrigation.

TheCattleSite News Desk

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