Chile - Country Commercial Guide
Agricultural Machinery and Equipment

This is a best prospect industry sector for this country. Includes a market overview and trade data

Last published date: 2021-01-16

Overview

Agriculture is one of the main economic activities in Chile, accounting for 24 percent of the country’s total exports, and 11 percent of its total GDP. Approximately 9 percent of the country’s labor force is engaged in agriculture and related services. Chile has a small internal market, and its economy is driven by exports, concentrated primarily in copper and its agricultural sectors:  fresh fruit, wine, forestry, meat, dairy, and fishery products. Chile is the world’s largest exporter of fresh table grapes, blueberries, prunes, dehydrated apples, and frozen salmon fillets. After the sector’s impressive growth of 9.5 percent in 2015, and 3.7 percent in 2016, growth fell to 2.5 percent in 2017, mainly due to low production of livestock and poultry, and low crop production, especially corn. However, agriculture recuperated growing by 5.8 percent in 2018, becoming the fastest growing sector, and by 5.5 percent in 2019, well over the 1.8 percent of Chile’s economic growth during the same period.

Agriculture faces a difficult scenario due to high labor and energy costs and a historic drought that has affected the country during the last decade. The challenge for today’s farmers and farming conglomerates is to become more sustainable. However, farmers and agriculture-related companies have not invested in new projects, machinery, and equipment, preferring to purchase replacement equipment. Agriculture machinery from the U.S. has a high reputation, and is in demand, but U.S. companies must be aware that the market is small and very competitive.

Chile always looks for innovative technologies to address the lack of labor and water in the production of its major crops. Robotic equipment such as unmanned tractors (for planting, harvesting, fumigating, weed removal), and robot/workers will be required in some areas of the country. Drones are already being used (although not on a massive scale) to collect data on soil condition, hydro availability, harvest conditions, fertilizer presence, etc. The current market for specialized and energy efficient machinery and equipment is a best prospect since it reduces labor, saves energy, and subsequently lowers production cost. Productivity has increased in recent years, but needs to increase even further, with the use of new and higher efficiency machinery, technology, irrigation systems, natural fertilizers, and soil enhancers. The industry trend is to mechanize agriculture processes such as harvesting, and to use other labor replacement machinery and equipment, which are in high demand by Chilean farmers. Chile must reduce production costs to remain competitive in the international market, of which it is an important food supplier.

Chile’s agriculture is focused on sustainability and natural products with the Chile brand. Organic production has increased, and natural fertilizers and pesticides are needed. Chile’s agriculture production aims at being as ‘green’ as possible, and to remain as such, obtaining better value for its exports, and contributing to a healthy environment.

 

2017

2018

2019

2020 estimated

Total Local Production

12

12

12

     9

Total Exports

1

9

7

     6

Total Imports

366

443

524

 420

Imports from the US

76

83

68

   85

Total Market Size

369

446

529

 423

Exchange Rates: 1 USD

649

641

770

 790

Total Market Size = (total local production + imports) - exports
UNITS:  $ millions
Source:  Thomson Reuters Chile / Chilean Customs

Leading Sub-Sectors

  • Smart agriculture “machine learning” devices for agriculture processes such as planting, watering, fertilizing, collecting data, etc.
  • Equipment/drones to effectively monitor production conditions, propose improvement processes, and increase crop yield.
  • Irrigation infrastructure is required to maximize efficiency of water usage. There is an critical water shortage, and investment in irrigation and other related systems represent an opportunity for U.S. agriculture machinery manufacturers.
  • Water storage systems and water transportation systems (and supplies) to line canals, tunnels, and underground reservoirs. The authorization to build water reservoirs takes at least 15 years due to the bureaucratic process entailed, involving several ministries and government entities. Large water storage systems that can replace water reservoirs are a good prospect.
  • Mechanization of agriculture processes including fresh fruit harvesting equipment. Machinery to replace labor.
  • Energy efficient machinery and equipment (decrease energy consumption). Environmentally friendly machinery and equipment (reduce impact on environment and provide higher sustainability).
  • Equipment, systems and supplies to obtain traceability of crops.

Opportunities

FRUITTRADE 2020, October 7-8, 2020, Santiago, Chile

FruitTrade is the trade event/seminar related to the fruit and vegetable production and exports. The event brings together producers/exporters, with international buyers of fresh fruit, dried fruit, vegetables and organic products. FruitTrade includes a business roundtable and an International Convention, featuring technical seminars on trade, technology, production, innovation and management.

SAGO-FISUR 2020, November 14-17, 2020, Osorno, Chile

Sago-Fisur trade show, whose first version took place in 1917, focuses mainly on dairy and livestock, and regional fruits/berries production. The event is attended by suppliers, distributors, and service providers related to the agriculture sector, and includes technical seminars, and the most important exhibit of pedigree cattle and equine. The Chilean Association of Slaughtering Plants organizes a special seminar on the subsector.

IFT Agro 2021, May, 2021, Talca, Chile

IFT Agro is the largest and most important agriculture trade show in the country. The International Trade Show, IFT- Agro 2021, is an industry trade event committed to bringing together leading suppliers of technologies to produce agricultural goods, products and services with decision-makers from small, medium and large producers who need access to technology to become more competitive in this industry.

Web Resources

MINAGRI - Chilean Ministry of Agriculture

ODEPA - Oficina de Planificación Agraria (Chilean Office for Agricultural Policy Studies)

SAG - Servicio Agrícola y Ganadero (Agriculture and Livestock Service)

SNA - Sociedad Nacional de Agricultura (National Association of Agriculture)

INDAP - Instituto de Desarrollo Agropecuario, (Institute of Agriculture Development)

CONAF - Corporación Nacional Forestal (National Forest Agency)

AGRYD – Asociación Gremial de Irrigación y Drenaje (Chilean Association of Irrigation and Drainage)

For additional information, please contact CS Santiago Commercial Specialist Mary L. Lathrop, Mary.Lathrop@trade.gov.