Agricultural Industry in Colombia and its opportunities for foreign companies

In recent years, Colombia became the fifth largest agricultural exporter in Latin America after Brazil, Mexico, Argentina, and Chile. According to the Pontificia Universidad Javeriana de Cali, the country’s agribusiness receives a very good rating due to its water resources management, financial inclusion of farmers and agricultural businesses, regulations for the use of fertilizers and the transportation services for agricultural goods it provides. This conditions, added to the projections of growth in the global food demand, made of Colombia an important opportunity in the agricultural industry.

Increase in demand

According to Procolombia, an annual growth of 8.5% is projected between now and 2025 in the demand for packaged food, a figure above the region’s annual average. This will allow the Latin American region to have great projections in the agricultural sector in the coming years.  On the other hand, the purchase of fruits and vegetables in the region could register a growth of 9.4%; confectionery products 7.2%; fresh foods 1.2%, fresh fruits 1.7% and fresh vegetables 1.4% in the same period. This would make this region a market of interest with various countries capable of meeting such high demands; such is the case of Colombia.

Colombia has strong investment potential in the agricultural sector. One of its main advantages is its territory since it has more than 40 million hectares available for production activities. Of these, only around 19% are used, so the country has the opportunity and the potential to make the most of this situation and generate value-added production.

Growth of the agricultural industry

According to ProColombia, during 2019 and 2020, the agricultural-related activities received 77 projects with businesses for USD $1,179 million and it is expected that more than 25,120 new jobs will be generated in Antioquia, Bogotá, Caldas, Cesar, Cundinamarca, Huila, Meta, Nariño, Putumayo, Quindío, Risaralda, Tolima, Valle del Cauca and Vichada. Products such as Hass avocado, exotic and citrus fruits, food ingredients, special coffees, meat and poultry industry are part of the niches that receive foreign capital.

The country has great opportunities in this sector with the production of fruits such as avocado, one of the great protagonists in the industry. According to the Ministry of Agriculture, the production is more than 400,000 tons of avocado of different types in 20,000 hectares. According to the statistics of the Legiscomex Commercial Intelligence System, during the third quarter of 2021, Colombian exports of Hass avocado were USD $22.49 million and presented a growth of more than 200% in relation to the same quarter of 2020, when sales external were USD $7.50 million. This fruit is mainly exported to the Netherlands, Spain, United Kingdom, Belgium Costa Rica, and Germany.

All of the above, together with the expected GDP growth in Colombia of 5.8% by 2022, represents great opportunities for the country to become one of the largest food pantries in the world. It is also a great opportunity for foreign companies in the agricultural industry looking to expand and invest in new markets. Altios International can provide all the tools needed, thanks to our more than 30 years of experience, crucial in helping your expansion project in Colombia succeed.