Pedro Castillo's Proposal: Ban on imports of rice, wheat and corn would double prices, according to specialists

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This week, Pedro Castillo, candidate for the presidency for Free Peru, insisted on the proposal to ban imports corn, wheat and rice.

In this regard, Alejandro Fuentes, president of the Association of Agricultural Producers Guilds of Peru (AGAP), points out that there would be multiple negative impacts that prohibiting the entry of certain products would have.

One of them, according to Fuentes, would be the increase in prices, since the supply would be reduced and without modifying the demand.

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“When entry to certain products is closed or tariff barriers are placed on them, two things happen: the local product rises in price because there is less supply and demand is the same, and the quality of the product decreases due to less competition,” says Fuentes. .

Faced with a possible ban on the entry of hard yellow corn, its price could double or even triple, estimates Juan Fernando Correa, president of Cómex Peru, who also details that the price of chicken and eggs could rise “at least by double what it costs today ”.

“The chicken feeds on hard yellow corn. It is the main component of your diet. Imported corn covers 80% of the local demand ”, he details.

Another product that could double in price, according to Correa, is bread if the entry of wheat is prohibited. “National wheat production only covers 10% of local demand,” he points out.

In the case of rice, whose import covers 10% of local consumption, the president of Cómex estimates that its price could increase between 10% and 15%.

The economist Iván Alonso, for his part, points out that another phenomenon would also occur: when the prices of products whose importation has been prohibited rises, the consumer tends to look for substitute goods that may not be of good quality and that their prices also increase as consequence of the increase in demand.

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For his part, Daniel De La Torre, a researcher at the University of the Pacific Research Center, points out that thinking about banning imports “does not make sense”, since we do not have enough capacity to supply the local market.

“For example, we would need about a million more hectares of local wheat to be able to replace the amount of wheat we import per year,” says De la Torre.

The researcher also warns that if they prohibit imports of certain products or apply higher tariffs, the countries with which Peru negotiates would take similar measures.

Thus, preventing imports would generate a shortage of products, hitting the pockets of consumers. In addition, it would cause other countries to prevent the entry of Peruvian products or apply tariffs to them, harming the Peruvian farmer and all those who live directly or indirectly from this sector.

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