Agriculture in Argentina is projected to grow at a CAGR of 5.9% during the forecast period (2020-2025).
- The agriculture production is dominated by the aforementioned, most profitable cereals and oilseeds, hence other market segments haven’t grown much in the last two decades. The most important fruits and vegetables are grapes, apple, limes and lemons, pears, and onions, garlic, potatoes, tomatoes.
- The market in Argentina is driven by sustained adoption of GM seeds resulting in a high profit, which was pumped back as an investment, improved access to loan facilities for small farmers and also diverse climatic conditions that favor the production of highly important crops.
Key Market Trends
Improved Consumer Spending Towards for Fruits and Vegetables
Improved awareness across various social media platforms related to health and well being has boosted demand for various food products and in particular fresh fruits and vegetables. In the year 2016, the new government of the country has lifted export taxes on all fruits and other commodities. In addition, one year later, export rebates were increased for several products, including apples, pears, and grapes among others. People in the country are discovering the link between healthy food and they're well being and switching their alternatives to fruits and vegetables. According to FAO, The country produced 6893.7 thousand tons of fruits in 2016 which increased to 8066.4 thousand metric tons in 2018 owing to the growing demand for local produce in the country.
In addition to this, with the rising health consciousness, there is also an increasing consumption trend towards varieties of off-season fruits, which are usually met by rising imports. For vegetables, like potatoes, there is a recent trend of growing consumption especially among the middle-income group in South Africa. The crops, such as beans, carrots, turnips, chilies, peppers, onions, oranges, apples, citrus, grapes, bananas, tomatoes, peaches, strawberries, and avocados are some of the major fruits and vegetable crops identified with great market growth potentials in Argentina during the forecast period. Therefore, the fruits and vegetables market is anticipated to grow in the years to come which in turn will drive the overall market for agriculture in the country.
Food Crops Dominate the Argentinian Agricultural Market
Argentinian food crops dominate the agricultural market in the region. Maize is the most important food crop, followed by wheat and barley. The country reported a total of 43462.3 thousand metric tons of maize production in 2018, with wheat accounting for 18518.0 thousand metric tons in 2018. Climatic conditions, coupled with a good of knowledge about transfer activities is the factor driving the agriculture sector in Argentina. Support through various agricultural organizations like ACSOJA, which helps to promote the scientific-technical research in production and industry areas, as well as commercialization of agricultural products aids in the growth of agriculture in the country. According to FAO, the production of food crops increased from 61147.0 thousand metric tons in 2016 to 76396.7 metric tons in 2017.
Favorable climatic conditions and supportive government and agricultural organizations are expected to drive the food crop market. The food crop market in the country has matured considerably since the decrease of export taxes and fewer restrictions on the production of these commodities. Producers, traders, and other intermediaries interact freely in the marketing of their produce. Therefore, the food crops market is anticipated to grow over the forecast period which will increase the market revenue of the overall market in the country.
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