Peruvian agribusiness seeks to expand in Colombia due to recent change in law

RIO DE JANEIRO, BRAZIL – As the new Agrarian Promotion Law in Peru brings about changes, agro-exporters from the country have started to look to Colombia for lands to fulfill their expansion plans.

Pilar Lozano, Commercial Attaché of the Colombian Embassy in Peru, said that up to five Peruvian agro-industrial companies of various sizes are at different stages in purchasing land in the country, which they plan to use for Hass avocado cultivation, according to Gestión.pe.

“Some have already decided that they are going to invest, however, still have not determined where, as logistical conditions and land availability must be assessed,” Lozano was reported as saying.

“With the other companies contact is very recent as they are still evaluating whether, with the change in the Agrarian Promotion Law in Peru, it is more competitive for them to invest in Colombia.”

For some of the agro-industrial companies, steps taken to invest across the border began some time ago, while others expressed this interest due to the recent change in the law.

The areas that Peruvian companies have the greatest interest in are coffee plantations, such as Antioquia, because the soil and climate conditions are favorable for the cultivation of Hass avocados, according to Lozano.

Some of the conditions that are evaluated are the proximity of packing companies, ports and workers.

ProColombia, a governmental agency in charge of promoting exports, international tourism and foreign investment, is accompanying Peruvian companies with their efforts to buy land.

“Companies want to analyze the changes under the new law and compare, since it seems that it could be more competitive for them to invest in Colombia,” Lozano was reported as saying.

It has become known in recent years that Peruvian companies Camposol, Danper and Cerro Prieto, already have hectares of crops in Colombia.

According to Lozano, also the ProColombia director for Bolivia and Peru, some of these companies are looking for land for new cultivations, as they plan to continue growing.

Investments of Peruvian companies in Colombia are aimed mainly at the cultivation of avocados, but there are efforts to purchase land for planting mangos and blueberries as well.

Colombia already has 25,000 hectares of Hass avocados cultivated and has good visibility in destinations such as China.

Meanwhile, the land planted with Hass avocadso in Peru exceeds 31,000 hectares with productivity per hectare at 10,000 tons on average each year, as reported last year by the Association of Producers of Hass Avocado of Peru (ProHass).

At the end of December last year, the Peruvian Congress approved the new Agrarian Promotion Law, which obliges employers to pay their employees a bonus equivalent to 30% of the minimum wage salary, added to the basic salary and bonuses. The regulation of the statute is still pending.