Trade and Palm Tree Products in Colombia
The Republic of Colombia is a large South American country with a total territory of more than 1.1 million square kilometers, which is almost twice the size of Texas. Simultaneously, Colombia has several geographies, notably lowlands throughout its Atlantic and Pacific coastlines that extend for over 3.200 kilometers as well as vast plains towards the center of the country and the majestic Andean mountain range. Similarly, the country has a total population of more than 47 million citizens, over 75% of which live in an urban setting, notably the capital city of Bogota. Currently, Colombia’s annual gross domestic product (GDP) is approximately US$670 billion and it has experienced positive economic growth upwards of 2.0% in recent years. The Colombian national economy is divided into 7% agriculture, 34% manufacturing, and 59% services. Meanwhile, the agriculture industry utilizes some 38% of the national territory, while another 54% is forested.
Amongst Colombia’s oldest trade agreements is the 1969 customs union signed with the Andean Community, which includes Ecuador, Peru, and Bolivia. Likewise, Colombia has been a member of the World Trade Organization (WTO) since 1995. More recently, Colombia has signed free trade agreements (FTAs) with the United States, Canada, Costa Rica, and the Republic of (South) Korea. Similarly, Colombia has commercial agreements with trade blocs, such as the European Free Trade Association (EFTA), the European Union, and the Northern Triangle in Central America, which includes Honduras, Guatemala, and El Salvador. Lastly, Colombia is part of the Pacific Alliance, which is a regional trade bloc conformed alongside Mexico, Peru, and Chile.
In terms of trade, Colombia’s most important partner is the United States. The United States is the country of origin of approximately 28% of the imports into Colombia as well as the consumer of 28% of Colombia’s exports. In second place, there is China, which accounts for almost 19% of the imports into Colombia and who purchases more than 5% of Colombia’s exports. With the intention of increasing bilateral trade relations, China and Colombia launched studies and consultations last year for the negotiation of an FTA. This article explores the status of the agricultural industry in Colombia.
Trade and Palm Tree Products in Colombia
Within the agricultural industry, Colombia has intensified its palm tree and coconut operations in recent years. In 2014, Colombia yielded over 129.600 metric tons of coconuts, a level of production that had only been achieved once before, in 1991. Furthermore, Colombia’s output of palm oil, destined for biofuel and cooking purposes, increased from 1 million tons in 2013 to 1.15 million tons in 2014. This means that Colombia is the fourth largest producer of palm oil in the world after Indonesia, Malaysia, and Thailand. Furthermore, Colombia annually exports over 200.000 tons of palm oil.
It is important to make the distinction between coconut oil and palm oil, which are different products. In the case of coconut oil, the largest producers in the world are the Philippines, Indonesia, India, and Vietnam. Likewise, while the price per ton of coconut oil currently averages US$1.500, the price per ton of crude palm oil averages US$500.