Due to the high geographic concentration of global production, Central America has increased its imports, but at the same time has become more vulnerable to crop losses, rising international prices and possible disruptions in supply chains.
The importance of the market for this type of food is that rice, wheat, corn, beans and soybeans are basic foods on which the world's population largely depends, since it is estimated that almost half of the calories consumed by people come from these foods.
Because of the scarcity of rain in the region known as the Dry Corridor, producers in the country estimate that in the first cycle of the year has lost about 30% of corn crops and 35% of beans.
Directors of the Union of Agricultural Producers of Nicaragua (Upanic) explained that for the so-called "first production", Estelí lost 50% of the bean crop, and in Nueva Segovia fell between 40% and 50%.
As part of a long-term plan to increase grain sales to the North American country, a group of Nicaraguan producers will start with a first shipment of 40,000 hundredweight.
The group of producers leading the initiative explained that the sale will be made jointly with Honduran producers.In the case of Nicaragua, it is expected that about $2 million will be generated from the export of 40 thousand hundredweight.
Behavior and price trends in production of white corn, black and red beans, wheat and rice in Mesoamerica and the Caribbean in June 2016.
From the Regional report on the Basic Grains Market in June 2016:
In Mesoamerica and the Caribbean in May 2016 white maize prices showed stable trends compared to April 2016, despite declining regional supply due to the completion of harvests and reduced inventories from 2015, but these were offset by world imports.In beans, stable prices were observed, not greatly affected by the losses in Apante and with a slight reduction in prices in Costa Rica and Mexico.In general, black bean prices have been favored by imports, and the use of substitute products as in the case in Haiti. Rice prices have remained stable in most countries, except Haiti where there was an increase due to the depreciation of Haitian local currency.
2016-2017 forecast: 1.6 million hectares in cropland, cattle slaughter at 795,000 head and milk production raging between 275 million and 300 million gallons.
The Plan for Production, Consumption and Trade in the 2016-2017 Cycle includes details of the Nicaraguan government's projections for the agricultural, livestock, poultry, aquaculture and forestry sectors for the current year and the next.
The Colombian government has reduced tariffs to 0 on imports of lentils, beans and garlic, and suspended the price band for crude and refined oils.
From a statement issued by the President of Colombia:
The National Government has approved a reduction to 0% on tariffs on the import of lentils, beans and garlic, and has temporarily suspended the price band for crude and refined oils, which will ease the cost of the food basket for Colombians during the first half of 2016.
Producers in Costa Rica must further improve their productivity if they want to compete with the low prices offered for the same product internationally.
Currently a quintal of the grain sells in Costa Rica for around $40, whereas inside the Costa Rican market producers are trying to sell their harvest for $60, arguing that industrialists are offering them at lower prices in order to buy their production.
Anticipating a possible decline in sales to Venezuela, employers in the agricultural sector are looking for potential buyers for their products in Chile and Peru.
After the United States, Venezuela is the main buyer of Nicaraguan products, however, with the fall in oil prices the Union of Agricultural Producers of Nicaragua (UPANIC) is predicting a decline in exports to the country and therefore is looking for new markets in which to sell its products.
Nicaraguan producers are complain that phytosanitary controls applied by the government of Costa Rica have increased the illegal entry of Nicaraguan beans, estimated at $4 million a year.
On average over 160 containers holding 480 pounds of beans each are smuggled to Costa Rica, amounting to approximately $26,000, as "... a result of phytosanitary measures restricting the entry of beans with impurities," say Nicaraguan businessmen.
Due to a reduction of local production because of drought, the government has authorized, for the second half of the year, an increase in tax-free imports of red beans, rice and corn.
In the case of red beans, an additional 10,000 tons has been approved on top of the 20,000 authorized in June, while for rice the quantities will be defined in the coming days.
Costa Rica and Honduras are the countries with the highest rates as of July 27th, 2014 for red beans, costing $2,133 and $1,695 a metric ton, respectively.
The shortage of beans has raised prices across the region and all countries have been forced to authorize emergency imports in order to supply markets.
After Costa Rica and Honduras, as reported by the Agricultural Council (CAC) "...Guatemala is in third place, with $1,615 a metric ton (MT) and then Nicaragua with $1,609.35. The lowest prices were quoted in late May in El Salvador, with U.S. $1413.04 MT.
Industrialist point out that the declaration of shortage of grain by the government has failed to solve the problem in the local market, where the price of a kilo has increased by $1.
The National Association of Manufacturers of Beans in Costa Rica (Anifri) argues that the change in the verification of phytosanitary measures by the Ministry of Agriculture is the cause of the grain shortages and price increases in the country.
The government will control 95% of the 20 tons of red beans that have been authorized for duty-free purchase from any country which is a member of the World Trade Organization.
The remaining 5% will be distributed "... on a first come, first serve basis, until the available volume of each quota runs out," says ministerial agreement 025-2014 as reported by Laprensa.com.ni .
In Nicaragua, the largest producer in Central America, the price of a metric ton increased from $602 in May 2013 to $1676 in May this year.
Of the 'seda' variety of red beans, the countries with the largest price increases are El Salvador and Nicaragua, with increases of 80% and 178%, respectively. Guatemala reports a 130% increase in the 'rojo tinto' variety of red beans, according to the Agricultural Council (CAC).
The 2013-2014 crops in both countries are not large enough to meet the demand of the respective populations.
Laprensa.com.ni reports that in Honduras " ... basic grain producers are warning that importing beans will be necessary, due to the low yield obtained in the 2013-2014 cycle in the country. Juan Valladares president of Prograno, said the shortage of beans in the country is not alarming, but imports of this grain will be needed and one of the markets where they would normally buy from is Nicaragua."