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Economy & Business - October 2003

Commodity briefs...

BANANAS: The authorities in Ecuador came to an uneasy truce with striking banana producers. They gave in to two of the growers' principal demands: the declaration of a state of emergency for the entire agriculture sector in the main banana producing region of El Oro; and a promise that the government act as an intermediary with exporters to ensure that producers receive the agreed minimum price of US$3.2 per box, rather than the US$0.60 which growers claim some exporters are offering. 

Whether this agreement, which was made on 19 October, will have any effect remains to be seen. The growers are annoyed that President Lucio Gutiérrez is hanging on to his new agriculture minister, Sergio Seminario, despite strong pressure from banana producers to dismiss him because he has close ties with banana exporters. The previous agriculture minister, Rodrigo Lasso, had resigned because of the government's cravenness before the exporters.

COPPER: Brazil's biggest single exporter, the Companhia Vale Do Rio Doce, the world's biggest iron ore producer, is planning to invest US$3.3bn to become one of the world's top 10 copper producers. The company expects to raise production to 700,000t within six years as it develops five deposits, all in the Amazonian state of Pará. The plan is that the projects will turn Brazil from being a net importer of copper to being a net exporter. 

COFFEE: Colombia reported that both production and exports fell marginally in the last coffee year, which ended on 30 September. Despite the 1.4% fall in the volume of coffee exports, revenues rose slightly, though the Federación Nacional de Cafeteros did not provide a figure. Production in the coffee year was 11.8m (60-kg) bags, 238,000 bags less than for the previous year. Exports were 10.4m bags, down 152,000 bags. For the calendar year, coffee production in 2003 is up 1.2%, at 8.01m bags, for the first nine months. Exports are up by 5%, at 7.36m bags.

FRUIT: Chile's fresh fruit exports were 8.36% higher in the 2002/03 season compared with the previous year. The season runs from September to August, and, according to the Asociación de Exportadores, exports came to 1.89mt. The main exports were grapes, apples, kiwi fruit, pears and avocados. Exports to the two main markets, the US and Canada, were up by 17%, at 784,545t. Exports to the European Union were 514,584t, also up 17%. Exports to the rest of Latin America were down by 15%, while exports to the Far East were up by 11% and those to the Middle East were up by 7%. 

SALMON: Exports of salmon and trout from Chile increased by 32% in the first eight months of this year, compared with the same period of 2002. Sales came to US$745m. The main reason for the increase in sales was a rise in salmon prices: the average export price was US$4 a kilo this year compared with US$2.5 a kilo in the first eight months of 2002. The salmon association is forecasting that salmon exports will come to US$1.2bn this year. This will be 23% up on 2002's figure. The two main sorts of salmon produced by the fish farming industry are Atlantic salmon, production of which was up by 55% in the first eight months, and Coho salmon, which is very red and sold mostly to Japan. Chile's salmon farming industry is the second-biggest in the world, after Norway. The industry is the country's fourth-biggest export earner. 

BEEF: Brazil expects to become the world's biggest beef exporter over the next two or three years. Between August 2002 and July 2003, the country overtook Australia, the world's traditional number one, but this was largely due to the drought in Australia. Brazil is the second-biggest beef producer, after the US, with 170m head of cattle. It accounts for 15% of world beef production and 18% of world beef exports.

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