Overview
Chile has adopted a commercial policy to open and diversify markets for its agricultural and food products. Chile has 33 international trade agreements that cover 65 markets.
Chile’s main agricultural exports include wine, fresh fruit, dairy, salmon, pork, poultry, and forestry products. In 2022, agriculture and related sectors represented 26.9 percent of total Chilean exports ($26.9 million), 8.5 percent of total gross domestic product (GDP) ($27.5 billion) and employed around 10 percent of Chile’s labor force.
U.S. agricultural exports to Chile totaled $1.1 billion in 2022, a 9.2 percent decrease over 2021. Chile is the third-largest market in South America for U.S. agricultural products, after Colombia and Peru. Chile is the second-largest market in South America for U.S. consumer-oriented agricultural products with $670 million worth of export sales in 2022. The top U.S. agricultural exports to Chile are beer, dairy products, pork, poultry, beef, and wheat.
Chile has a developed food processing industry that generates $23.3 billion annually and is forecast to grow by 35 percent by 2030. Healthy foods, gourmet foods, prepared foods, and ready-to-eat meals show large potential for growth in the Chilean market. Chilean consumers have an increasing concern for health-related issues while the food processing industry continues to adapt to the nutritional labeling law, higher labor costs, and sophisticated consumers, all of which present challenges, but also opportunities for U.S. high value-added products and ingredients.
Chilean Processed Food Industry
In 2022, food and beverage processing represented 15.2 percent of Chile’s exports, at $15 billion. The food processing industry is the second largest economic export sector after mining. According to ProChile, the Chilean Export Promotion Agency, the food processing sector employs over two million workers. The United States maintained its position as the second largest supplier of consumer-oriented products to the Chilean market with a 13 percent market share after Brazil.
Chilean food processors sell their products nationally and internationally. The Foreign Investment Agency of Chile (InvestChile) reports that 54 percent of Chile’s total food production is destined for the domestic market, and 46 percent is exported to more than 180 countries worldwide.
The Chilean food and beverage processing industry consists of more than 98,890 food processing companies. Some large international companies use their production plants in Chile to serve other markets in Latin America. Chilean food processing companies sell 60 percent of all processed food products to supermarkets and hypermarkets. A smaller share, 38 percent, of packaged food is sold through smaller retailers such as mom-and-pop shops and food/drink specialists.
There are three main reasons for Chilean companies to import food products and ingredients: (1) If the products are not available domestically through local production (2) if it is cheaper to import rather than buy domestically; or (3) if imported products offer a higher quality than those available in the domestic market.
The Chilean Nutritional Composition of Foods law was implemented in 2016. The law requires labeling of food products high in sugar, saturated fat, calories, and sodium. The Chilean food industry constantly searches for formulas that avoid mandatory labeling associated with the law.
For further information on food processing ingredients please see Food Processing Ingredients GAIN report.
Retail Food Market
Chile has been one of Latin America’s fastest-growing economies in the last decade, enabling the country to have a modern and dynamic food retail industry. Retail food sales totaled $26.8 billion in 2022, a 12 percent increase over 2021. Supermarket food sales totaled $14.9 billion and represented 55.5 percent of total retail food sales in 2021. The COVID-19 pandemic prompted increased online shopping, especially for groceries and consumer foodservice.
There are five main retail groups in Chile: Falabella, Cencosud, Walmart Chile, Ripley, and La Polar. Falabella and Cencosud have department stores, home centers, and supermarket/hypermarkets. Chile has a modern, highly competitive supermarket sector.
Chilean supermarket chains use two systems to supply products in their stores: distribution through suppliers, where suppliers deliver products directly to each store, and centralized distribution where suppliers deliver products to a distribution center that supplies each store afterwards.
Imported food and beverage products for the food retail sector may enter Chile through the following channels:
Direct imports: large supermarket chains import directly from foreign producers/exporters and own most of the wholesale supermarkets, which then redistribute to smaller stores as well. They operate large distribution centers that supply the entire country.Indirect imports: distributors and wholesalers import products to distribute to retail stores.
Most of the independent stores get their products at discount prices from wholesalers. They act as an intermediary because smaller stores do not have the logistics capacity to import.
Important factors for Chilean consumers’ purchasing decisions are store location, price, and promotional activities. Chilean consumers are well-informed, they compare prices, and look for promotions and variety before making a purchase. A determining aspect that is driving consumers’ behavior is innovation and adoption of new technologies. Chile has widespread internet access and vast access to technology, pushing Chilean consumers to online shopping.
The family size has gradually decreased in Chilean cities. Large families are less frequent, and single-person households are more common. These trends are shaping the way Chileans buy groceries and demand food services. Smaller households with less storage space make frequent purchases from grocery stores located near their homes or jobs.
For more information on the retail market see Retail Foods GAIN report.
Hotel, Restaurant, and Tourist Industry
The Chilean food service industry is closely linked to the hospitality and tourism sector and has grown consistently in the last decade. Unfortunately, the COVID-19 pandemic had a major impact on the Chilean hotel and restaurant industry (HRI) as international travel to Chile and sanitary restrictions forced the temporary and permanent closure of many HRI businesses. For restaurants, online ordering developed from being almost insignificant in 2019 to representing 23 percent of value in 2022. This means to be successful, restaurants now need to be able to develop an attractive online presence.
Despite the general negative economic impact of the COVID-19 pandemic, Chile still offers excellent opportunities for U.S. food and beverage exports, especially for those U.S. companies seeking to initiate or expand exports to Chile’s retail and HRI sectors. Chilean consumers appreciate U.S. food and beverage products as they are considered high quality.
For further information on food services please see Food Service – Hotel Restaurant Institutional.
Business Recommendations and Import Procedures
For details on how to export to Chile, exporters should refer to Chile’s Global Agricultural Information Network (GAIN) reports: Chile: Exporter Guide, Chile: FAIRS Export Certificate Report and Chile: FAIRS Country Report.
The Foreign Agriculture Service (FAS) Santiago recommends U.S. exporters exhibit or attend Chilean trade shows, particularly the U.S. Pavilion at the Espacio Food & Service show. The show is recognized as the most important annual gathering in the Chilean food industry and provides the opportunity to connect with over 28,000 Chilean and international buyers.
Potential exporters should conduct market research, including the identification of appropriate business contacts and Chilean import regulations to successfully seize market opportunities and overcome market challenges.
Potential exporters should contact the FAS office in Santiago, Chile for inquiries or requests of assistance to export agricultural products to Chile. U.S. companies seeking to export food products to Chile are advised to conduct exploratory research to understand the Chilean market. FAS GAIN reports are a good source of country specific information. Exporters work closely with FAS to promote U.S. food products through SaborUSA’s Facebook and Instagram accounts and to strengthen the community of U.S. food lovers on social media.
A trade show can help companies contact local distributors/sales agents, buyers, and businesspersons, and become familiar with local competition. In the case of new-to-market companies, exporters should be prepared to provide support for in-store and media promotions to familiarize consumers with their products. Another option for exporters is to participate in state/regionally organized trade missions.
Exporters should adjust their product to local preferences and, if possible, prepare promotional materials in Spanish, and assign a specific budget to promote their product locally. Exporters should develop an appropriate marketing campaign that informs the consumer about the origin of the brand. Slogans and marketing materials should be understood in Spanish.
While regulations are relatively transparent, changes are not widely advertised. Hence, the exporter or his/her representative must monitor the official journal (Diario Oficial), where periodical changes are published. The websites of the Ministry of Agriculture and the Ministry of Health are additional resources U.S. exporters may consult. Spanish labeling is mandatory for all products.
Opportunities
Wheat and corn cheese and ice creamPet foodFeed (corn gluten meal, soybean products)Beer SpiritsBeef PorkSnack foodsSauces, mixed condiments and seasoningsFlours and starchesAnimal and vegetable fats and oilsPeptones and other proteinsLegumes (beans, lentils, chickpeas)
For further information regarding the Agricultural and Food sectors, contact the U.S. Foreign Agricultural Service.