Farmer’s Day: in Peru, 4 out of 10 farmers are in poverty

Every June 24, the Day of the Farmer is celebrated at the national level; however, there is little to celebrate. In Peru there are more than 2 million 200,000 farmers grouped in more of 6,200 peasant communities and 1,322 native communities, according to him Ministry of Agrarian Development and Irrigation (Midagri).

Thus, rural men and women represent around 25% of the country’s economically active population (EAP) and generate employment for more than 4 million people.

However, despite being one of the largest economic sectors and having achieved growth of more than 3% per year over the last decade, it is also the one with the highest poverty rates.

During 2022, 41% of farmers —that is, 4 out of 10— were in a situation of poverty. This figure is more than 13 percentage points higher than the national average, which stands at 27.5%, according to the National Institute of Statistics and Informatics (INEI).

Miguel Pintado, an economist at the Center for Social Studies (Cepes), explains that the rise in poverty in agriculture is due to the inflation that was registered last year in all goods and services. This is added to the increase in the cost of agricultural inputs, such as fertilizers and the costs of marketing, machinery and fuel. “The situation was also aggravated by the four failed attempts to purchase urea by the State”, he comments.

Added to these factors are weather phenomena, such as droughts and floods, which led to crop losses in various producing areas of the country during 2022 and this year, hindering progress opportunities for farmers. farmers.

departmental poverty

Poverty has hit the hardest farmers dedicated to family farming —those who manage less than 3 hectares of crops—, since 42% are in this situation.

In this segment, whose commercial margin is 38% —compared to 68% for non-family farming—, the high level of poverty is associated with a lack of resources, less land and difficulties in accessing markets and development opportunities. , underlines the Cepes specialist.

On the other hand, if a breakdown by region is made, agrarian poverty has increased by more than 10% in seven departments located on the coast, highlands and jungle. Among them Loreto, Ayacucho, Ucayali and Piura (see infographic).

In general, of the 24 departments of the country, 17 had increases in the poverty and only seven reduced it. In the case of extreme poverty, the increase occurred in 20 departments.

Among the factors that could be contributing to this increase is the price of the fertilizers most used by farmers, since the cost of importing and distributing of these products is higher in these regions.

As Pintado explains, the average price of urea last year was around S/2,300 nationwide, but in the departments with the highest poverty rates it reached up to S/3,600 per ton.

long term policies

The high rate of poverty in the agricultural sector is due, in part, to the lack of specific policies directed towards small farmers.

“There have been some attempts by governments to implement strategies and plans for agricultural development, most of these measures have not translated into budget increases,” says Pintado.

In this sense, it stands out that redistributive or emergency support policies have a limited impact on improving the living conditions of the agrarian population. “Structural policies are required in the medium and long term, with a focus on agriculture and oriented towards the sustainable progress of the sector”, he concludes.

Plantings are still in red

Until April of this year, for approximately 30 crops —which constitute about 90% of the planted areas— a little more than 1 million 895,000 hectares were registered at the national level. Which meant a reduction of 4.3% compared to what was sown in the same period of the 2021/2022 agricultural campaign, according to Midagri data.

Among the reasons for this setback are the absence of rains in the second half of last year, mainly between October and November, as well as the high price of fertilizers, indicates the ministry in its latest Sowing Progress Evaluation Bulletin.

The dad It continues to be among the products with the greatest reduction in its planted area with close to 267,739 hectares. This is 9.1% less than what was planted in the previous season up to April.

Amaximandro Rojas, president of Conveagro, points out that, in addition to the fertilizer crisis and weather phenomena, another element that prompted this setback is the social upheaval that occurred in the first months of this year.

Thus, it stands out that the decrease in the planting of the main crops shows that agriculture is going through a general crisis. “This really affects rural economies, especially those producers who farm for their subsistence,” he highlights.

Other foods whose plantings are lower than the previous season are rice (-4.2%), starchy corn (-7.6%), corn corn (-6.5%), quinoa (18.2%), onion (-8.9%), etc.

Potato production fell by 25%

The accumulated potato production in the first quarter of 2023 reached close to 1 million 806,900 tons. This is 25.9% less than what was produced last year in this same period of 2022 (2 million 439,000 tons).

75% of the potato produced in the first half of the year comes from the producing regions of the Andean highlands, under rainfed conditions. This, according to Rojas, is one of the elements that explains the decline in production.

“The yield (of the crop) due to the drought suffered a stress in the areas that were planted and did not have the same productivity”, raised the representative of Conveagro.

In addition, he adds that the lower supply of the tuber will be reflected in higher prices. In line with these statements, during April, the potato farm price remained for the second month at S/1.70 per kg on average, which is 25.2% higher than what was observed in the same month of 2022.

“The increase could be said to reach the producer, but it is not. There are several chains. The one who is going to benefit is the one who sells in the market, not the producer because he is producing less”, affirms Rojas.

On the other hand, other products, despite having contracted in their sowing volume, have increased in their production level.

Among these foods, rice stands out, which with 1 million 134 thousand 420 tons increased by 11.3%. On this side there is also hard yellow corn, whose production grew 1.6% with 394 tons until April.

Prioritize family farming

Approach. Eduardo Zegarra, Grade researcher

The most striking fact is that normally the poverty of an agricultural household is double or even triple the incidence of poverty in a non-agricultural household.

So, it indicates that a child born in an agrarian home will be two or three times more likely to be poor in his life. This is both cause and effect in terms of access to services.

Well, rural and agrarian areas have very precarious access to health services and, in the case of farmers, to productive services such as credit, technical assistance, extension, information and other services that are also very precarious.

Among the causes there is an issue of historical neglect of family farming in Peru. We have almost 30 or 40 years where this sector has not been adequately addressed by public policy.

And indeed this is a sector that faces problems of fragmentation, the aging of the producer, little capacity for innovation and serious problems in generating income.

There are also more circumstantial causes. We are already in a third year of a very complicated agrarian crisis and not much has been said, for example, about issues such as the climate, in which there is evidence that this is generating quite serious impacts on the agrarian sector.

The public agenda has to be completely changed, putting attention to family farming first.

reactions

Anaximander Rojas, president of Conveagro

“Agriculture is going through a general crisis. This really affects rural economies, especially those producers who sow for their subsistence (…). Less is being planted”.

Miguel Pintado, economist at Cepes

“In general, agricultural activity in the country is located in rural and dispersed areas where the presence of the State is not as high as in the main cities. It is there where there has been, in fact, the greatest affectation ”.