Hundreds of Peruvian agricultural workers were last week maintaining a blockade of the key Pan-American Highway in the north of the country to protest against the death of three people in clashes with police.

The movement now appears to be subsiding since the government ordered talks to be held on Jan. 2.

The protesters are blocking a part of the Pan-American Highway about 500 kilometers (300 miles) north of the capital, Lima, where they had already been on strike since early last month.

The workers are angry about the Agrarian Law bill passed by Congress on Tuesday. They had been demanding that agricultural-export companies increase their daily wage from $11 to $18, but the bill only proposed an increase to 48 soles, around $13.

In a bid to calm tensions, President Francisco Sagasti vowed to "sanction the police that didn't respect the ban on using firearms" on protesters.

"We deplore and reject what happened in La Libertad. We condemn those who incite violence," he said on Twitter.

Sagasti also proposed dialogue to find a solution to the problem after acknowledging that the bill passed by Congress "didn't satisfy any of the parties."

"Congress approved an agrarian promotion law that does not satisfy any of the parties involved. I will convene a national agreement forum to discuss the future of the agricultural sector and other measures," he said. 

In response, the workers had agreed to unblock the highway to begin dialogue on Friday, Prime Minister Violeta Bermúdez announced.

The government also announced an investigation into the deaths during the protests and said the police chief of the La Libertad region would be removed. 

AGAP warns of job losses

Meanwhile, the Association of Producers’ Guilds of Peru (AGAP) said the Agrarian Law bill would lead to the loss of 200,000 jobs in the agricultural sector. The group also believed that blueberries would be one of the most affected crops.

As indicated on AGAP’s website, “after the exaggerated rise in labor costs and production, agro-export companies will be forced to rethink their investments, hiring and production level”.

It says the changes would generate an overcharge of 61 percent, which would directly affect the GDP reduction, agro-exports, investments and employment, causing one in three farmers to be affected and lose their jobs.

“For example, in the case of asparagus crops, around 3.8 million annual wages would be lost, which represents S/145 million (approx. US$40 million) that workers and families would stop receiving each year,” said Alejandro Fuentes, president of AGAP.

Regarding table grape producers, who would lose 6 million wages, for S/226 million ($62 million) of income for farmers; for avocado producers, the loss would be 1 million wages for S/39 million ($10 million); and in blueberries 8 million wages for S/320 million ($88 million).