Trade and production: Chile

Chile is a huge producer of fruits and vegetables and is in the top five producers of cherries and cranberries worldwide. Chile is also the ninth-largest producer of grapes, with wine being a key export product. Agriculture represents 3.3% of GDP (World Bank, 2023).

Following the EU Exit, the UK and Peru signed a continuity trade agreement in 2019 to replace the previous trade agreement with the EU.

Beef

Livestock production is key in rural areas of Chile but is often undeveloped due to poor technology and inefficient breeding. Cattle is one of the key livestock animals, with exports growing in the last five years.

Beef consumption is 19 kg per capita; domestic production does not meet demand (OECD 2023). Chile relies heavily on imports to satisfy demand and to provide higher-quality cuts of meat. It mostly imports beef from neighbouring South American countries: Paraguay, Brazil, Argentina and Colombia, plus a significant amount from the USA.

Chile exports an average of 20 Kt of beef each year, mainly to China and Canada. Overall exports are valued at around £65m each year. Chile also exports a small amount of beef to the UK: about 26 t a year on average.

Table 1. Beef annual production and trade, 2019–2021 average (TDM)

Sheep

Sheep production in Chile is relatively low. Sheep are often found on small mixed-family farms with small to medium-sized flocks. Sheep meat is mainly for family consumption, with any surplus sold into the local area.

Sheep consumption is very low, about 0.36 kg per person per year (OECD 2023). The demand is largely met by domestic production, with limited imports from Brazil.

A small amount of sheep meat is exported, valued at around £28m annually. The predominant export market is China, with 3 Kt heading there, followed by the USA (1 Kt).

Table 2. Sheep annual production and trade, 2019–2021 average (TDM)

Pork

Pork production in Chile is significant and is expected to continue to grow. Pork is the second-largest livestock sector after poultry. Production is mainly indoor and is highly efficient using advanced technology.

Pork is one of the most consumed proteins in Chile: Consumption is currently 17 kg per person each year and is expected to increase to 22 kg by 2028 (OECD 2023). Chile imports 116 Kt of pork each year to satisfy demand. The key exporters of pork to Chile are Brazil, the USA, the EU and Canada.

The UK secured market access for pork at the end of 2022, and exports of pork to Chile started towards the end of 2022. UK pork exports to Chile are expected to be worth an estimated £20m over the first five years.

Chilean pork exports have been increasing year on year, and they are currently the eighth-biggest exporter of pork worldwide. The primary destinations for exports are the Asian markets: mainly China, South Korea and Japan.

Table 3. Pork annual production and trade, 2019–2021 average (TDM)

Dairy

Dairy production in Chile is reasonably robust, with over 500,000 dairy cows in milk and 6,000 commercial farms. Dairy production occurs across the whole country; however, the south is the most productive area with its ample rainfall and good grazing; the north, by contrast, often struggles with drought conditions.

Types of dairy farms vary. There are many small-scale farms focusing on milk production, while bigger operations focus on producing value-added products such as cheese and yoghurt. In the past 10 years, the dairy industry has experienced significant expansion and mechanisation, including robotic milking. This has resulted from increased demand for dairy and exports of dairy products such as cheese.

Butter consumption is currently 1.37 kg per person per year; this is expected to increase slightly to 1.58 kg per year by 2030 (OECD). Cheese consumption has been increasing over the last decade and is currently 7.59 kg per person per year. This is expected to continue increasing to 8.74 kg by 2030 (OECD).

Chile imported an annual average of nearly 58 Kt of cheese between 2019 and 2021, worth over £169m a year. The key suppliers are the EU, Argentina, the USA and New Zealand. Chile exported an annual average of just over 8 Kt of cheese between 2019 and 2021, worth over £27m a year. Its cheese is mainly exported to Mexico, Russia and South Korea.

Chile imported an average of nearly 5.5 Kt of butter annually between 2019 and 2021, worth over £18.7m a year. The key suppliers are New Zealand, the EU and Argentina. Chile exported over 2 Kt of butter annually between 2019 and 2021, worth nearly £8m a year. Butter is mainly exported to the USA, Mexico and Peru.

Table 4. Butter annual production and trade, 2019–2021 average (TDM)

Table 5. Cheese annual production and trade, 2019–2021 average (TDM)