Living in Peru : your everyday companion

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DOING BUSINESS IN
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From the Peruvian Sierra to the U.S.: Quinoa

The demand for quinoa has increased in the world. The United States and France are the main importers. A United Nations Food and Agriculture Organization (FAO) document indicates that "It is one of the few foods of vegetal origin that is nutritionally complete, that is to say, that has a suitable balance of proteins, carbohydrates and minerals necessary for human life." In addition, quinoa is the basis of dozens of processed foods and, being an organic product, is desired by consumers in the industrialized countries due to the healing, anti-inflammatory, analgesic and disinfectant properties attributed to it.

Among Peru’s competitors, Bolivia is one of the world’s largest suppliers of quinoa and directs its exports mainly to the U.S., France and Spain. The Bolivian National Association of Quinoa Producers sells an annual average of 800 tons to the U.S., six European countries, Chile and Brazil. In addition to being the main exporter, this association was the pioneer in quinoa production and since 1983 has managed to bring together seven partnerships that group nearly 5,000 small producers from Oruro and Potosí. In the past 20 years, it has changed from being only a project in the struggle against poverty to becoming a mighty industry that struggles against desertification, applies advanced agricultural techniques and agilely sends the golden grain of the Incas to other continents. It is a highly successful example of grouping small farmers together into associations.

In the U.S., United Natural Foods is one of the principal buyers of South American quinoa, and imports an average of almost 500 tons per year. Carrefour, the second largest chain of supermarkets in the world, buys and distributes processed quinoa products in more than 35 countries, including the U.S., Argentina and Brazil.

The major zones of production of quinoa in Peru are located in the departments of Puno, Huancayo, Cuzco, Ayacucho and Cajamarca. The exports of quinoa and products derived from quinoa in 2005 surpassed US$ 720,000, an increase of almost 80% over 2004. Nonetheless, a large part of these exports consist of unprocessed quinoa; less than 5% are products that are processed on the basis of quinoa. The main destinations of unprocessed quinoa exports are the U.S. (65%), Germany and Spain.

It is important to consider that there are new producers of quinoa: the U.S., Canada, Chile, Argentina and Colombia. Even Brazil began to harvest quinoa in 2005. European universities also have research programs on quinoa. Peru must not lose the opportunity to export unprocessed, and even more, processed quinoa products that have added value.

Wooden Furniture in the U.S.

The United States, Germany, United Kingdom, France, Japan and Canada make up the major part of world demand for wooden furniture, whereas the greatest exporters are Italy, Germany, Canada, China, the United States and Poland.

Exports from Italy, the largest European exporter, are almost US$ 8 billion a year, but they have remained stagnant since 2003 in terms of dollars; whereas exports from China, Canada and Poland are increasing considerably. China is the greatest supplier to the North American market, with US$ 4 billion in 2005 according to United States International Trade Commission (USITC).

A study conducted by Prompex in 2004 determined that the Peruvian export potential is aiming toward the manufacture of fine finished and carved furniture, with small production volumes and having middle- and high-income consumers as a target market segment. For Ricardo Dueñas, consultant on wood for Prompex, Peru is not prepared for a standardized industry market.

This study indicates that the Peruvian furniture manufacturing companies are only capable of supplying a small percentage of this sector in the U.S. The few of such companies in Peru have a low volume and artisan production capability. International sales in the sector wood and its manufactured products reached US$ 136 million in 2004 and closed last year with foreign sales of US$ 169 million. Within this sector, the export of furniture and furniture parts reached US$ 16 million in 2005, an increase of 12% over 2004. According to Dueñas, Peru mainly exports consoles, center tables, and Rococo-style or Luis XV bureaus.

Furthermore, according to the Strategic National Exporting Plan (2003-2013), more than half the imports of wooden furniture and its parts are concentrated in the states of California, New York, Michigan and Texas, which import 25.3%, 17.4%, 7.1% and 6% respectively. Peru must direct its efforts toward these markets.

The U.S is the Main Destination of Peruvian Exports of Wooden Furniture

(Source: Veritrade)

tags : Peru economy business FTA PTPA USA import export wood furniture quinoa agriculture

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