Mendoza agricultural sectors face prolonged economic crisis

The agricultural sector in Mendoza, Argentina, is facing significant economic challenges, particularly within the wine and peach industries. According to a report by Coninagro, the wine and molasses complex has recorded 41 consecutive months in the ‘red zone,’ marking a continuous crisis since January 2023.

Key indicators for the wine sector include a 30% year-on-year drop in the average price received by producers and a decrease in vineyard surface area to 196,000 hectares. Additionally, the producer's share of the final price has fallen to 13%, significantly lower than the historical average of 24%. Domestic consumption is also projected to decline by 8% compared to 2025.

Similarly, the peach processing industry is struggling with rising costs for energy and fuel, alongside a decline in domestic consumption. Alfredo Baroni of the Strategic Plan for the Peach Industry (FEPEDI) noted that while production levels remain stable, shrinking profit margins are forcing some factories to close and producers to abandon their orchards. To mitigate these issues, the industry is seeking to increase duty-free export quotas to Mexico from 10,000 to 20,000 tons.