Market Trends of Grains Industry In Paraguay
Growing Grain Export Market
Paraguay stands out as a top exporter of maize, wheat, sorghum, and rice in South America. Agriculture plays a pivotal role in Paraguay's economy, engaging roughly a quarter of its workforce and dominating the nation's exports. Fueled by rising domestic and export demands, particularly from the animal feed sector, Paraguay has seen a consistent uptick in grain production. Recent years have witnessed notable surges in both grain production and exports. For instance, according to FAOSTAT, the production of grains was 6.3 million metric tons in 2021, which increased 7.9 million metric tons in 2022.
Paraguay exports grains primarily to neighboring South American countries, including Brazil, Chile, Argentina, Bolivia, and Peru. However, countries outside South America, such as the Philippines, South Korea, and the United Arab Emirates, are also important importers. According to the ITC Trade Map, the export value of maize increased from USD 409,076 thousand in 2021 to USD 750,699 thousand in 2023. In 2023, the main markets for Paraguay-sourced maize exports were Brazil (USD 271,209 thousand), Chile (USD 178,611 thousand), South Korea (USD 113,996 thousand), and Peru (USD 84,033 thousand), representing market shares of 36.1%, 23.8%, 15.2%, and 4.9%, respectively.
In addition to maize, Paraguay exports wheat, sorghum, rice, and other grains to these markets, with Brazil being the largest importer. According to ITC Trade map, Rice exports, in particular, grew from 824,177 metric tons to 910,575 metric tons between 2022 and 2023. This increasing demand for grains is not only expanding Paraguay's export market but also driving growth in the studied market during the forecast period
Maize Dominates the Grains Market
In Paraguay, maize (corn) has emerged as a pivotal crop, contributing to the country’s grain market alongside soybeans and wheat. Dominating South America, Paraguay leads in maize production. Serving as a dietary staple, maize constitutes more than 40% of Paraguayans' daily caloric intake. While farmers primarily grow maize to meet domestic demands, a surge in demand has been met with an uptick in production. According to FAOSTAT, maize production rose from 4,088,093 metric tons in 2021 to 6,191,650 metric tons in 2022.
According to USDA, Paraguay's two distinct corn crops. The summer crop, Zafra, is sown in August and harvested by late January, typically spanning 30,000-60,000 hectares. Under favorable conditions, farmers expect yields of about 8 tons per hectare. Additionally, beef and dairy producers often plant corn for silage. Most of Paraguay's maize serves as animal feed, with only a minor portion for human consumption, underscoring its primary role in livestock nutrition, alongside sorghum and wheat. Moreover, local seed producers, known for their "casera" or homemade seeds, plant early to prepare for the second crop, zafrinha, in February. In 2021-2022, a severe drought impacted the soybean crop, limiting seed availability for zafrinha. This prompted farmers to expand their corn acreage. Given the increasing reliance on maize for animal feed and the uptick in production, Paraguay's maize market is poised for growth in the coming year.
