Increased investment and the expansion of irrigated land along the Peruvian coast has ensured the continued development of large-scale industrial agriculture for more than two decades. After introducing dozens of new products, local agri-business firms have successfully expanded and diversified the country’s agricultural export base. Meanwhile, increases in both production and exports occurred despite the effects of the El Niño climatic phenomenon, which caused heavy flooding and crop damage in coastal areas in 2017.

Today, Peru’s food exports are second only to mining outputs as earners of foreign currency. This strength should encourage further expansion and consolidation, particularly in Asian markets. Moreover, strategic policies and improved efficiency of land and water use should help Peru become a leading global supplier of goods like anchovies and avocados.


Peru is one of the top-20 fruit and vegetable suppliers worldwide, according to the Association of Peruvian Agrarian Producers Guilds (Asociación de Gremios Productores Agrarios del Perú, AGAP). Additionally, it ranked first worldwide in fishmeal production in 2018, surpassing the EU’s output by 50,000 tonnes.

In 2018 agriculture grew by 7.5% to reach PEN29.4bn ($8.9bn), according to the Ministry of Agriculture and Irrigation (Ministerio de Agricultura y Riego, MINAGRI). The fastest-growing yields included olives, which rose by 97.2%, followed by cotton (55.8%); paddy rice (27.2%); cacao (18.3%); bananas (10.3%); and avocados (7.9%). The strongest performers in livestock were chicken (9.8%); eggs (4.5%); raw milk (2.6%); and pork (1.4%).

Peru exported $7.03bn in agricultural products to around 135 countries in 2018. The US was its largest export market, receiving around one-quarter of the sum, followed by the Netherlands, Spain and Ecuador. The value of agricultural exports is projected to reach $8bn in 2019 and $10bn by 2021 (see analysis).

Moreover, fisheries production increased by 39.8% in 2018 to PEN2.7bn ($817.3m), after the Ministry of Production (Ministerio de la Producción, PRODUCE) significantly expanded the seasonal quota for anchovies. The allowance has fluctuated from year to year since 2009, as regulators have worked to mitigate the depletion of local stock and relieve downward pressure on prices caused by oversupply.

External Factors

Several economic factors considerably influence sector performance. Globally, the growth of Peru’s main trading partners has been a boon. The US economy recorded growth of 2.7% in 2018, while China, Peru’s top market for fishmeal, maintained a 6.7% rate. Domestically, agriculture received a boost from state efforts to recover from flooding and damage caused by the 2017 El Niño, especially in several northern regions. An additional PEN600m ($181.6m) has been set aside for 2019, to invest in 350 reconstruction and resiliency-building initiatives at 57 critical points in watersheds and rivers.

Fluctuations in global food prices are also decisive for agriculture’s prospects. For instance, coffee continues to fall from its recent peak in November 2016, although downward pressure has not yet caused a drop-off of production or exports. “Coffee prices will continue to fall on the global market; however, a 5-8% growth in production volume is anticipated in 2019,” Lorenzo Castillo, manager of the National Coffee Board, told OBG. “While some coffee farmers have switched to cocoa farming, others are increasing the value of their product by ensuring they have various organic certifications. Around 35% of Peruvian coffee is now certified.”

Structure & Oversight

The sector is overseen by MINAGRI, while government policy formulation is currently guided by the National Strategy for Food and Nutrition Security 2013-21, which established nutritional self-sufficiency as a strategic national interest. The state also promulgated the National Crops Plan 2018-19 to strengthen productivity, encourage diversification among smallholders and disincentivise the cultivation of crops that exert disproportionate pressure on the irrigation system. Both documents align with the diversification goals set by the 2016 National Agrarian Policy to make the sector more open and competitive.

Fisheries and aquaculture policy is formulated, implemented and supervised by PRODUCE. The ministry’s second National Programme for Innovation in Fisheries and Aquaculture (Programa Nacional de Innovación en Pesca y Acuicultura, PNIPA) 2018-19 was designed to promote growth through research, innovation and strategic alliances among fishermen, aquaculturists, specialists, academics and businessmen. The World Bank will be supporting PRODUCE and the PNIPA with PEN113m ($34.2m) for the research and development of new technologies, with an emphasis on aquaculture.

Budget & Bicentennial

The public agriculture budget increased by 6% in 2019 to just over PEN2.2bn ($665.9m). The largest allocation, equal to 37%, addresses water infrastructure and river defences meant to modernise the irrigation network and minimise waste (see analysis). This is followed by special projects (19%), support for productive development (9%), and agricultural information, titling, land registry and forestry, among other items.

Public spending is rising in order to achieve a number of goals before 2021, when Peru celebrates the 200th anniversary of its independence. According to Gustavo Mostajo, a former head of MINAGRI, these goals include boosting agriculture’s share of GDP to 5% and increasing the value of agro-exports to $10bn by 2021.

With those ends in mind, in 2018 the government launched an ambitious programme to cultivate 84,000 ha of pasture for livestock development. In 2019 another PEN30m ($9.1m) will be put towards cultivating an additional 50,000 ha in 22 different regions, as well as training 32,100 farmers and organising 36 commercial events pertinent to the sector.


Agriculture employs 12.6% of the national workforce, the third-largest share by sector, according to the Ministry of Labour and Employment Promotion (Ministerio de Trabajo y Promoción del Empleo, MINTRA). In 2017 there were 2042 agricultural companies providing formal employment to 252,000 people, as well as 557,000 indirect jobs. Five of the country’s 20 largest employers were engaged in agricultural activities in 2018, according to AGAP.

A report issued by MINTRA in 2018 found that rising exports are driving demand for labour. More workers were hired to harvest, prune and de-leaf key produce like avocados, grapes, mangoes and asparagus. With regard to livestock and animal products, the fastest-growing positions were for nursery workers and assistants at processing plants, while the increase in catches of anchovies, prawns, hake and lobster has driven demand for fishermen, crew and boat riders.

However, informality remains prevalent. “At least 3.8m family or artisan farmers work in the countryside,” Moisés Quispe, executive director at the National Association of Ecological Producers in Peru, told OBG. “More than 80% of food comes from this population working in the field.” Efforts to minimise the unofficial workforce helped lift the sector’s rate of formal employment from 16% in 2001 to 25% in 2017. This success has been attributed in part to the passage of the Law of Agrarian Promotion in 2000, which established more flexible hiring regulations that take account of the seasonal nature of farming. The legislation is credited with a 33.1% increase in paid, formal employment in agriculture between 2014 and 2017. By comparison, formal salaried employment across all sectors increased by 12.4% in the same period. The law is scheduled to expire in 2021, though discussions are currently under way to extend the legislation or propose a replacement.

Smaller initiatives are also proving useful. In December 2018 the National Superintendence of Labour Inspection formalised 5000 seasonal field employees in 15 days. The work was centred in the cities of Ica and Lambayeque, where seasonal workers are hired to harvest grapes, blueberries, avocados and mangoes.


Recent attempts to tap into the fast-growing health foods market have also proved fruitful. Peru launched the Superfoods Perú brand in February 2017 while participating in the Fruit Logistica trade show in Germany. The public-private initiative is a comprehensive global campaign aimed at highlighting the quality, variety and benefits of the country’s native foods, such as quinoa, raw cacao and chia seeds, as well as less familiar crops like lucuma, a tropical fruit known as the “gold of the Incas”; sacha inchi, also known as the “Inca peanut”; camu camu, a potent source of vitamin C; and Andean grains like kiwicha and cañihua.

In the first half of 2018 the export value of non-traditional agricultural goods grew by 16.5% to over $3bn. In response to growing investor interest in these products, sector stakeholders held the Superfoods Peru Natura business conference in October 2018 and secured $42.2m in export contracts for select foodstuffs.

According to the Commission for the Promotion of Peruvian Exports and Tourism, 70 foreign firms signed 854 business deals with 75 small and medium-sized producers in Arequipa, Cusco, Junín, Lima, Puno and San Martín. Local interest in superfoods and organic products is also on the rise. “In 2016 there were 100 eco-shops in Lima, and now there are more than 1000, not counting those in the provinces,” Quispe told OBG.

The outlook for superfoods and similar produce remains promising, though regulators could do more in terms of certification to help smallholders. “Not a lot of entrepreneurs apply for organic certifications, and where they do certify, the cost is high,” Quispe said. “Therefore, through the Secretary of Public Management, we are developing an ecological participatory guarantee so that local and regional authorities can certify small farmers’ land for the national market.”

With only 4.4% of active agricultural lands equipped for modern agriculture, embracing mechanisation will be key to sustaining growth. MINAGRI announced in November 2018 that it would establish its first Agriculture Mechanisation Centre, with support from the Italian government. The objective is to disseminate Italian agro-technological knowledge in regions with the greatest potential for production growth, mainly in the Andean highlands. It dovetails with the National Livestock Development Plan 2017-27, which is aimed at facilitating the management and recovery of natural grasslands, forage conservation, genetic improvement, capacity building and value-added production.

Food Safety

In September 2018 MINAGRI unveiled an initiative to boost food safety by more closely regulating pesticide usage and setting a timetable to eliminate the application of the most toxic chemicals. MINAGRI set up a technical committee to analyse pesticides, propose managerial procedures and publish an updated list of such chemicals and start more stringent control on their sale and distribution.

The October 2018 meeting to establish the committee included representatives from the Directorate-General of Environmental Affairs, the Directorate-General of Environmental Health and Safe Food, and the Ministry of the Environment, as well as representatives from regional environmentalist organisation Campo Limpio, the non-profit National Society of Industries and the National Convention of Peruvian Agriculture.

In addition, the committee will try to apply international best practices for food preparation while remaining economically viable. For example, in 2017 the EU banned the preservative ethoxyquin and established strict limits for vegetables, fruits, nuts and meat; however, there are no restrictions on its use in fish. “As the EU is reviewing the use of ethoxyquin for fishmeal preservation, we are in the process of searching for new alternatives that meet industry requirements and are also cost-effective,” Jorge Risi, general manager of the National Fisheries Society, told OBG.

The industry is also under pressure to meet international phytosanitary standards. In keeping with efforts to reach out to Asian markets, the National Service of Agri-Food Health and Quality (Servicio Nacional de Sanidad Agraria, SENASA) will continue negotiating phytosanitary protocols to access new markets for almost 70 agricultural products. This will be especially critical for export destinations like China, South Korea, Japan and Malaysia, where superfoods are growing quickly.

The suppression of fruit flies, which harm produce mainly in terms of appearance, is a strategic goal of those protocols. SENASA is working to control the insect by placing 35,500 traps in 850,000 ha of farmland. MINAGRI is also working to reduce food-borne pathogens in several regions, with $92.7m in financing from the government budget and $100m from an International Development Bank loan.


While improved fisheries performance should positively affect primary industrial activity, the growth of value-added fish processing has been limited by policies promoting sustainability. “Certain fishing rights have been suspended in the southern area of the Peruvian coast for seven years now,” Risi told OBG. “Out of 13 processing plants that operated in the area in 2011, only five remain today. An average of 600,000 tonnes of anchovies used to be caught per year, while today we fish approximately 250,000 tonnes.”

In January 2017 the World Bank approved a $40m loan for the National Programme for Fishery and Aquafarming Innovation to increase the productivity and diversity of local fish farming, and lessen dependency on live catching. The government is contributing an additional $80m in pursuit of two goals: the first is to increase the production of species other than anchoveta while guaranteeing the sustainability of saltwater species; the second is to expand freshwater aquaculture and promote investment throughout the value chain.


With made-to-measure approaches being implemented across the country’s various growing regions, there has been steady progress made in productivity and exports, and growth figures for the sector reflect this. But certain hurdles still need to be addressed for Peru to move from being a regional agricultural leader to a global one. In the coming years, ongoing public programmes to assist small-scale farms should help ensure that more producers are integrated into the lucrative export industry. In addition, public-private initiatives that aim to develop value-added services could see the sector beginning to play an increasingly important role in the future of the country’s economy.