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close this bookExporting High-Value Food Commodities: Success Stories from Developing Countries (WB, 1993, 119 p.)
close this folderAppendix The development and performance of case study commodity systems
View the document(introduction...)
View the documentMexico fresh tomatoes
View the documentKenya 'off-season' and specialty fresh vegetables
View the documentIsrael fresh citrus fruit
View the documentBrazil frozen concentrated orange juice
View the documentChile temperate fruits and processed tomato products
View the documentProcessed tomato products
View the documentArgentina beef
View the documentThailand poultry
View the documentThailand tuna
View the documentChile fisheries
View the documentCultured shrimp production and trade in China and Thailand
View the documentSoybean development in Brazil and Argentina
View the documentDemand-driven agricultural diversification in Taiwan (China)

Chile fisheries

Traditionally one of the world's largest exporters of fish meal, over the past decade the Chilean fisheries industry has expanded considerably and diversified into the production, processing, and trade of fresh, canned, and frozen fish. Expanded volumes of trade, together with steady development of higher value products, resulted into a four-fold in fisheries exports from $225 million in 1979 to $896 million in 1989. The latter figure accounted for 10% of Chile's total exports and is equivalent to all of Chile's agricultural/livestock exports.

Chile has a favorable location and natural resource base to develop a competitive fisheries industry. The country's Pacific Ocean coastline stretches for 4300 kilometers. The Humboldt Current which reaches Chile's northern coast is very rich in nutrients, bringing an abundance of pelagic species (e.g. sardines, mackerel, and anchovies) which form the basis for the fish meal and oil industries. Further south, the waters are rich with dermersal species (e.g. hake) and high-value crustaceans (e.g. crab and lobster).

During the 1980's there was a rapid increase in investment in boats, processing facilities, 'fish farms', etc. by large numbers of local companies and some foreign investors. Rates of return have been high in most activities, both for smaller artisanal fishing operations and larger industrial fishing-processing operations. Employment growth in the industry has been rapid (about 10%/year in the late 1980s), with total employment reaching 136,500 people in 1987 (3.4% of total employment).

Chile Fish/Fish Product Export

Source: FAO Fisheries Commodity Yearbooks

The industry is predominantly export-oriented, with only 15% of landings going for domestic fishmeal use or human consumption. The industry has been a very effective exporter, able to meet strict international sanitary and quality control standards, attaining high operating and maintenance standards in processing, improving packaging, and being very responsive to changing market demand. While all segments of the industry has expanded, export growth has been especially rapid for edible fish and shellfish, with rapid gains in trade in frozen hake, surimi fish, and high-value trout and salmon. Exports of fresh and frozen fish increased in value from $47 million in 1985 to $209 million in 1989. Chile compensated for low world prices for fishmeal (a competitor with soybean meal) in the 1980s by increasing fish catches and meal export volumes. With relatively low costs and favorable quality, the industry has been competitive in many markets throughout the world, although its most important outlets have been Japan, the U.S., Australia, and several West European countries.

There have, however, been several negative dimensions of Chile's expanding fish export trade. First, the huge increase in fish landings has resulted in an over-exploitation of the resource base, threatening its technical and economic viability and putting a premium on developing aquaculture and higher value-added products. Second, there has been a significant over-investment in processing facilities, although it is not clear whether this was deliberate (in order to compensate for highly variable/seasonal fish catches) and will undermine processor profitability over the long run. Third, with a dominant export orientation, little attention was given to developing the domestic market. Fresh fish prices are not competitive with meat and chicken in urban markets and domestic fish consumption has remained stagnant at a relatively low level.