The union of exporters of bovine meat reports that since the end of September orders from the South American country have halted, falling practically to zero.
Business people in the Nicaraguan meat industry attribute the drop in meat sales to Venezuela to a sharp reduction in the volume of trade which the oil agreement between the South American country and the countries in the Alba contemplates.
The company Albanisa S.A. exported crude Venezuelan oil and derivative products to El Salvador worth a total of $204 million in 2011, at an average price of $102 a barrel.
The data has been provided from an investigation by the newspaper La Prensa of Nicaragua citing data from the Analysis Unit of the Directorate General of Hydrocarbons at the Ministry of Economy in El Salvador.
Satisfied with the current export trend to Venezuela, Nicaraguan business associations want to safeguard them using a formal trade agreement.
Employers believe a treaty for trade relations, which represented $248 million to Nicaragua in 2010, is necessary for stability and independence from political aspects.
Mario Amador, president of the Nicaraguan Chamber of Industry, admitted that "there are concerns about the effect on the business side due to what may occur in the relations between Nicaragua and Venezuela in the new context of restructured power under President Hugo Chavez, for health reasons ".
They argue that they must ensure there is enough cattle before building new slaughterhouses.
Representatives from the cattle industry responded to Albalinisa’s proposal of building two new slaughterhouses explaining that the focus must be first set on solving some of the issues which limit the sector’s productivity.
Specifically, they argue that even though they require additional slaughterhouses, they must first ensure there is enough cattle to supply them.
Nicaraguan businessmen are requesting the negotiation of a FTA, in order to sell their products directly.
Exports from Nicaragua to Venezuela jumped from $11.5 million in 2008 to $90 million in 2009. They are channeled through company Albanisa, and the leading category is livestock.
After this considerable increase, Nicaraguan entrepreneurs request the negotiation of a Free Trade Agreement, to expand the list of products with zero tariff.