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USDA GAIN: Oilseeds, Cotton, Sugar, Grain and Feed

18 August 2014

USDA GAIN: Venezuela Grain and Feed UpdateUSDA GAIN: Venezuela Grain and Feed Update

Post expects imports of yellow corn, rice, and wheat to continue strong based on rising domestic food demand, continued strong requirements of the animal feed industry, and further reductions in domestic grain production.
USDA GAIN Report - Oilseeds, Cotton, Sugar, Grain and Feed




Rice, Milled

Author Defined:


There are no changes in Wheat PSD numbers from the last Annual report. Despite the unfavorable economic climate in Venezuela, Post does not estimate changes in wheat imports. On the contrary, imports are forecast to remain strong reaching 1.62 million tons in MY 2014/15. As previously reported, Venezuela imports all of its wheat needs from Canada, the United States and Argentina, but imports are tied to currency availability controlled by the government which sometimes has left the millers in a situation where they don't have the dollars needed to import wheat when they need them. The Venezuelan wheat industry reported excessive delays in the issuance of import permits and approvals of foreign currency requests. These inconsistencies cause problems for the private sector in it cannot plan or develop a schedule for its imports resulting in sporadic inventory levels and distortions in the market. In turn, severe inventory shortages of wheat resulted in sudden stoppages of several flour mills and pasta processing plants.

As previously reported, Post estimates an increase in consumption in wheat needs at 1.59 million tons for MY 2014/15 due to increases in bread-product consumption from protein products as a consequence of growing shortage of meat products in the country. Pasta and wheat-based products continue being preferred foods, and a low-cost basic staple of the Venezuelan diet.

According to estimates of the Venezuelan Pasta Manufacturing Association, pasta production in 2013 reached about 329,540 tons representing a decrease of 11.5 percent over the previous year. The pasta manufacturing sector is represented by 19 companies with a total operational capacity of around 500,000 tons per year.

The Association also reported that between the years 2003-2007 average pasta imports were 3,578 tons/year, but due to critical shortages, grew to an average of approximately 19,750 tons/year during the period 2008-2013. Imports were carried out in large part by the government to be marketed through its official distribution network (CASA, MERCAL, PDVAL, BICENTENARIO) at subsidized prices, even lower than the official controlled price of domestically produced pasta. Currently, almost one-third of monthly domestic pasta production is marketed through state owned supermarkets.

The majority of wheat and yellow corn are still being imported directly by the private sector, however, the government, through its food purchasing agency CASA, has been importing greater volumes of wheat, basically from Canada, but more recently from Argentina.


Corn plantings will be less than previously planned for this year as a result of adverse weather conditions due to “El Niño”, which has caused severe drought conditions in several States of the country.

According to officials from the Ministry of Agriculture and Lands, the planting of white and yellow corn for the winter cycle, has advanced by 87 percent in Portuguesa State. Through June 2014, that accounted for about 200,000 hectares out of a total of 240,000 hectares. In Guárico, the situation is so bad; farmers are calling it the worst drought in the last 38 years. Only 70,000 hectares of corn had been planted by June compared to 140,000hectares planted by June 2013. At the beginning of the crop planting season there were 20 days of severe water shortage that decreased germination and development of plants, which in turn will impact overall production and yields.

Due to severe drought conditions, Post estimates a decrease in corn production for MY 2014/15 to 1.36 million tons. In spite of this downward adjustment, consumption is expected to remain unchanged for MY 2014/15 and covered with increased imports.


There are no updates for sorghum to report.

Some farmers proposed to the Government a plan to increase the area planted of sorghum due to problems with delays planting corn. Areas that are not sown with corn could be cultivated with sorghum, which is more resistant to dry weather. The Ministry of Agriculture is studying the proposal which includes taking measures to import sorghum seed, which is not readily available in the country. In the past, Venezuela imported sorghum seed from the United States.


The drought that a large part of the country is suffering has especially affected the production of rice in the area of Guárico State. Sources indicate that much of the rice crop planted in April, was lost due to the lack of water in that area. Given the situation, which is being made worse due to the lack of agricultural inputs, production of milled rice is forecast to drop from 385,000 tons in 2013/2014 to 378,000 tons MY 2014/2015. Domestic rice farmers have urged the Government to evaluate the problem and provide the necessary assistance to farmers to compensate for the expected reduced harvest.

Area planted to rice in Portuguesa State for 2015, is unchanged at 80,000 hectares with estimated better yields than Guárico since that district has invested in more wells to provide the water needed to flood the fields. In Portuguesa the problem is not so much water but light. However, in Guárico, area planted is expected to only reach 38,000 hectares. Another 15,000 to 20,000 hectares are to be planted in the Yaracuy river area and Monagas State.

The irrigation system of the Guárico River is drier than normal and some producers have not been able to plant. Some may be able to plant later if rains begin to fall in the next few weeks. In 2015, Post no longer expects rice production to recover significantly since the water level of the Guárico irrigation system is well below normal. The dry- season crop, representing 30 percent of total rice production, is totally dependent upon water from the irrigation system.

To compensate for the reduction in rice production, Venezuela has increased its imports of paddy rice form Brazil. Venezuelan rice imports from Brazil increased more than 600 percent in the first six months of 2014, according to the Brazilian Ministry of Foreign Trade (Secex). Between January and June 2014, more than 141,524 tons of paddy rice were sent to Venezuela, compared to 20,000 tons shipped to Venezuela in the same period in 2013. Rice imports for MY 2014/2015 are forecast at 530,000 tons.

Farmers who harvested rice in 2013-14, hope that the payment of the last subsidy approved by the Ministry of Agriculture is made soon. Producers claim that the payment system has not flowed as quickly as promised.

August 2014

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