China opens an opportunity for Peruvian quinoaPublished on 20 September 2019
The opening of this market will allow the Andean grain to break the growth barrier that imposed the maturation of the product to the markets to which it currently has access.
In 2010, Peruvian quinoa began a cycle of boom expansion. That year, the export value of the product doubled to US $ 13.1 million compared to US $ 6 million the previous year. Since then, only four years passed until it was consolidated as one of the main agricultural products exported from Peru, with figures above US $ 100,000.
However, since then, exports have faced the challenge of continuing to grow after the market reaches maturity: developed countries have already been supplied with large quantities of Peruvian quinoa, and this competes with that from Bolivia, as well as other origins (it may be a product of Andean origin, but it is already planted in other regions and scientific progress may allow greater productivity). In the following graph, you can see the evolution of shipments over the past seven years.
However, the value is sensitive to different circumstances, and this year the revenue generated by Peruvian shipments has registered a rebound in value for the best prices obtained. In general, Peru is the global benchmark, being the main producer, and in fact, according to a Bloomberg note, opening the Chinese market could generate an increase in the price of Peruvian quinoa, which could be due in expectation of a diversion of stocks or signing of future contracts towards the Asian continent. The following table shows the rise in exports in the first quarter of the year, which although we do not attribute to a response to this expectation, shows the impact of the variability of agricultural products.
In general, the challenge for Peruvian producers is to maintain quality. Part of the fall in exports in 2015 was due to the impact of the rejection of a Peruvian shipment in the United States due to the finding of a sample contaminated with unauthorized chemicals in organic certifications. This is a clear sign of the attention that should be taken in the care of safety, to which the development of technology must be added so as not to lose competitiveness with new producers in other parts of the world.
For now, the door of a market with huge opportunities has opened. So far, the United States is by far the main destination, followed by developed countries in Europe, as can be seen in the following table.
In general, there is diversity in medium-sized destinations: Together with the United States and Canada, 11 exceed one million dollars in value imported from Peru, enough for a product with less than a decade of development in the international market. It should be noted that there is no problem in moving shipments to any place on the planet: its durability allows everything to be transported by sea, except for some exceptions of land transport to nearby destinations, and by very few by air to various countries.
In general, the conditions are in place for Peru to expand its exports and production based on quinoa. The opening is expected to cause a 40% increase in grain production, which is not a small thing if one considers that this could represent an additional US $ 60 million in export.
For more information on Peruvian exports, you can go to the Veritrade page.
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