The increase in the international prices of corn and soybeans, inputs used to produce animal feed, threatens to put upward pressure on the production costs of meat, eggs and dairy products.
In recent months, the international price of a bushel (27 kilos) of soybeans increased by 28%, from $10.6 to $13.62, between November 1, 2020 and January 28, 2021.
Between 2017 and 2018, milk sales from Costa Rica to Panama fell 24%, explained by increased competition, while exports to Guatemala and the Dominican Republic increased 21% and 13%, respectively.
According to figures from the Promotora del Comercio Exterior (Procomer), between 2017 and 2018 sales to Panama of milk and cream not concentrated and concentrated registered a 24% decline, falling from $7.5 million to $5.6 million.
The regional guild of the sector reported that the volume of milk produced by the countries of the region increased from 3.5 to 3.7 million metric tons between 2015 and 2016.
According to figures from the Central American guilds, the increase in global production registered in 2016, when the most updated statistics exist as a region, is explained by increases reported in all countries, mainly from Costa Rica with 18%, followed by El Salvador with 14%, Guatemala with 13%, Panama with 6%, and Honduras with 4%.
The total amount of exported kilos of milk rose from 76 million in 2013 to 92 million in 2014, with the number one destination being Central America, mainly Guatemala and El Salvador.
Data from the National Chamber of Milk Producers (Caprole) indicates that after Guatemala and El Salvador, the rest of the isthmus is the main market for exports of Costa Rican milk, but the Dominican Republic, Cuba and Venezuela are beginning to have greater preponderance among the markets where milk produced in Costa Rica arrives.
From January 2016 import tariffs will start to be phased out on chicken, rice and milk from the USA, reaching 0% in 2022 and 2025, under the DR-CAFTA agreement.
In Costa Rica local producers say they have been preparing for this for several years, but the country's loss of competitiveness due to high production costs and lack of action by the government to improve on this might prevent them from competing on equal terms.
Costa Rican dairy farmers have denounced the fact that in the region regulations are not met nor are specifications on labeling and product features.
The Chamber of Milk Producers (CPL by its initials in Spanish) argues that there are companies in the region that are replacing animal protein with plant protein, or decreasing the percentage of fat in exchange for lowering the price of the product, which is not in compliance with the requirements and standards set out in the Central American technical regulations.
The main dairy producers and exporters in the region are preparing for the beggining of operations in Nicaragua by the Mexican dairy plant Lala.
It is expected that by early 2015 the plant owned by the company Lala will start operating in Nicaragua, meaning that "... Competition for the Central American market over milk and its derivatives will be more intense. "