agriculture

Exports expected to drop 30 percent

Rising shipping and production costs are dampening Panama’s agricultural exports.

LA PRENSA/Víctor Arosemena

down: Exports of some agricultural products are expected to decrease this year because of rising expenses.1089294

Non-traditional agriculture exports are expected to reach their lowest level since 2005.

The decrease is due to a rise in shipping costs as well as price hikes for goods such as fertilizers, which have cut into farmers' profit margins. In fact, some industry experts expect some farms to cease production because of rising costs, further diminishing exports.

According to the Asociación Nacional de Agroproductores No Tradicionales de Exportación (Ananex), exports could fall by 30 percent this year as compared to 2007.

“This reality will undoubtedly produce a decrease in agricultural activity nationally, which will have a negative effect on the country, especially for rural people,” said Ananex leader Francisco Antúnez. Nontraditional exports, namely melons, watermelons and squash, had started to become a larger part of Panama's overall agricultural industry, especially as foreign demand for these products expanded. But rising costs have since caused that demand to diminish.

Ananex has submitted a plan to avoid a drastic drop in exports, which includes tax breaks. Non-traditional agricultural exports started to grow significantly in 2005, when Panama exported 3,693 containers valued at $42 million.

Last year, the industry exported 7,500 containers with a value of more than $100 million.