During 2020 in the Salvadoran market, bean imports increased by 122% and rice imports by 51%, a rise that is reported in the context of the health and economic crisis generated by the outbreak of covid-19.
Figures from the Central Reserve Bank specify that between 2019 and 2020, foreign purchases of beans increased from $33 million to $60 million, and those of rice increased from $30 million to $45 million.
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.
Although the volume of corn, beans, and rice harvested is projected to increase in El Salvador by 2020, producers' expectations are not encouraging, since prices have fallen to levels insufficient to cover costs due to the import of basic grains.
Forecasts by the Ministry of Agriculture and Livestock (MAG) indicate that this year the country's corn harvest will grow by 11%, beans by 30% and rice by 20%.
The sector's union has estimated that for the 2017-2018 harvest 2.4 million hundredweight of beans will could have been produced, but due to climate effects, only 1.9 million hundredweight will be collected.
According to the Salvadoran Chamber of Small and Medium Agricultural Producers (Field), with the 500 thousand hundredweight of beans that will not be collected in the period 2017-2018, $25 million will be lost, as each hundredweight is valued at $50.
The Ministry of Agriculture has received a legislative endorsement to import the grain from outside of Central America in case of shortages during the second half of the year.
From a statement issued by the Ministry of Agriculture:
The Ministry of Agriculture and Livestock (MAG) asked MPs to issue Special and Transitional Provisions for Imports of Red Beans for Human Consumption, which would guarantee affordable prices for beans for the population, as well as supplying the domestic market, in case that the El Niño phenomenon affects the harvest of this basic grain.
Maize production declined from 20.4 million hundredweight in the 2012/13 harvest to 15.6 million in the 2015/16 cycle, and yield per cultivated hectare has also declined.
In the case of beans, figures from the Ministry of Agriculture and Livestock (MAG) show greater variability, depending on the bean and crop variety, as some have reported better results.However, bean productivity has deteriorated in recent harvests. Laprensagrafica.com reports that"... performance went from 15.1 hundredweight per hectare on average in the 2014/15 season, to 13.1 in the 2015/16 cycle."
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.
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.
Authorization has been given for the importation of 12,000 tons of red beans which will not incur customs duties, no matter what country they come from.
From a statement issued by the Legislative Assembly of El Salvador:
During the plenary session on Thursday urgent and temporary measures were approved with 58 votes, aimed at promoting imports of red beans, in order to ensure affordable prices for the population and adequate supplies the domestic market.
The Superintendency of Competition has concluded that there is no evidence of anticompetitive practices in pricing by traders.
From a statement issued by the Superintendency of Competition:
After thoroughly analyzing information and documentation on six bean traders, the Superintendency of Competition did not find enough evidence to lead to initiate an infringement procedure for anti-competitive practices concerning price fixing, limitation of quantities or market division, typified in points a, b and d of Article 25 of the Competition Act.
Drought was the main factor behind the drop of 49% in exports for 2014 of rice, beans and corn, compared to the previous year.
At the end of 2014 $6.5 billion in exports of grains were reported, ie, $6.4 million less than the $12.9 million recorded in 2013. Drought damaged about "... 2.6 million hundredweight of white corn and 86.107 hundredweight of red beans in the 2014 harvest."
The government has announced that it will soon start the process to purchase corn and bean seeds to be delivered as part of agricultural parcels given to producers.
From a statement issued by the Ministry of Agriculture of El Salvador:
The Minister of Agriculture, Orestes Ortez, today announced that the government will soon start purchasing the corn and bean seeds which are delivered as part of agricultural parcels, a program of vital importance to ensure food security for Salvadoran families.
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.
The government plans to create, using the 2014/2015 harvest, a strategic reserve of beans to try to influence the market during the season of high prices.
The proposal which emerged under the Funes administration but never came to fruition could be implemented in the next season, as announced by the Ministry of Agriculture.
"The ministry does not need a law to establish a strategic reserve of beans.
The government has authorized the purchase of 9000 tons of red beans without tariffs until 31 October.
The permission granted by the Council of Ministers for Economic Integration (COMIECO) to the government of El Salvador will be valid until 31 October for the acquisition of up to 9000 tons of red beans from countries such as Colombia and Mexico.