For the first time in history, Venezuela’s coffee imports will exceed domestic production, according to an estimate from the US Government.
The U.S. Department of Agriculture expects Venezuela’s demand to reach 1.3 million 60-kg bags in the crop season ending in September, while the nation’s production is forecast to dip to 660,000 bags, the third-smallest crop on record since 1960/61.
Outbreak of coffee leaf and unprofitable domestic prices set by the government are pushing producers out of the market.
More and more coffee growers are switching to cattle or leaving agriculture altogether and moving to cities, according to sources.
Falling coffee production and near-record demand has forced Venezuela to buy more higher-priced foreign beans.
To keep up with rising demand, Caracas imported almost 70,000 bags of Nicaraguan beans in the last three months of 2014, more than any other country and more than 60 percent of the amount it brought in from Nicaragua in all of the 2013/14 crop year, reports Reuters quoting data from Nicaragua’s Center for Export Processing (Cetrex) show.
The purchases are carried out under the Petro-Caribbean Agreement, in which Venezuela ships subsidized crude oil to political allies like Nicaragua in exchange for basic goods, according to the same source.
Under the agreement, Nicaragua received 27,000 barrels of crude oil and refined products a day from Venezuela in 2013.
