In this installment of the ‘Agronometrics In Charts’ series, Sarah Ilyas studies the impact of the El Niño phenomenon on Peru’s agricultural export industry. Each week the series looks at a different horticultural commodity, focusing on a specific origin or topic visualizing the market factors that are driving change.

Peru's agricultural export industry is facing challenging circumstances, as a second year of adverse weather conditions disrupts a prolonged period of growth, during which the Andean nation emerged as a formidable force in the global fruit and vegetable trade. The El Niño phenomenon is likely to cause farm shipments to shrink 5% this year and stay flat next year, said Gabriel Amaro, head of agribusiness group AGAP.

This represents a departure from the prevailing trend within an industry that demonstrated resilience and growth even during the depths of the pandemic, as well as during the last occurrence of El Niño in 2017. The uninterrupted expansion propelled Peru to become the leading global exporter of grapes and blueberries, while also positioning it among the biggest suppliers of mangoes, asparagus, and avocados. “These changes in climate have affected all of our production,” says Amaro. “We hope next year it won’t be too strong and we can at least have the same exports that we are generating this year. What we certainly won’t have anymore is the 10% annual growth rates that we used to have.” So far this year, agricultural exports are down 3%, with the negative impacts of El Nino expected to grow toward year-end, Amaro said. “In 2024, everything will depend on El Nino’s magnitude.”

Estefania Ruiz, the Marketing Manager at Fluctuante, has highlighted that the agricultural sector, constituting 6% of the national economy, is at the epicenter of the crisis. The predicament has mainly arisen from rains and associated droughts, which have severely impacted the production of vital crops such as mangoes, lemons, grapes, blueberries, and bananas.

Source: USDA Market News via Agronometrics.

(Agronometrics users can view this chart with live updates here)

Source: USDA Market News via Agronometrics.

(Agronometrics users can view this chart with live updates here)

Source: USDA Market News via Agronometrics.

(Agronometrics users can view this chart with live updates here)

Source: USDA Market News via Agronometrics.

(Agronometrics users can view this chart with live updates here)

In Piura, a region heavily dependent on agriculture, an alarming 90% of the flowering in mango and lemon plants has been lost. This has led to the elimination of jobs, as the scarcity of fruit has resulted in a labor vacuum in the fields. In the southern part of the country, a severe drought has struck, with regions like Arequipa facing up to a 40% risk to both agricultural and livestock production. This, in turn, implies a substantial reduction in food availability and a corresponding 40% decrease in employment, according to Daniel Losada, the president of the Arequipa Agricultural Society.

Reports indicate that agricultural exports have suffered a 4% decline between January and August of 2023, with a particularly sharp decrease of 7% in August alone. It is anticipated that by 2024, Peru's agricultural product exports will experience a pronounced adverse impact due to these climatic anomalies.

Data sourced from the Piura Chamber of Commerce further elucidates the dire situation, with a staggering 90% decline in mango production in Piura, and significant reductions in other crops, including avocado by over 50%, bananas by nearly 40%, grapes by just under 30%, and blueberries by a similar margin. A further slowdown is anticipated in 2024, primarily due to the prolonged influence of the El Niño Phenomenon.

In our ‘In Charts’ series, we work to tell some of the stories that are moving the industry. 

All pricing for domestic US produce represents the spot market at Shipping Point (i.e. packing house/climate-controlled warehouse, etc.). For imported fruit, the pricing data represents the spot market at Port of Entry.

You can keep track of the markets daily through Agronometrics, a data visualization tool built to help the industry make sense of the huge amounts of data that professionals need to access to make informed decisions. If you found the information and the charts from this article useful, feel free to visit us at www.agronometrics.com where you can easily access these same graphs, or explore the other 21 commodities we currently track.