Food Processing Equipment Overview

An Expert's View about Food, Beverage and Tobacco Processing Machinery in Argentina

Posted on: 29 Nov 2012

The food processing equipment market in Argentina relies heavily on imports by large domestic food processing companies and food exporters.

Argentina: Food Processing Equipment Overview Summary The US continues to hold its position as the largest supplier of food processing equipment to Argentina. While local production figures are almost non-existent, imports are estimated to account for 70 to 85 percent of the total market. Imports experienced a peak surge in 2011 but are expected to return to more moderate growth levels, due to a weakened demand both locally and internationally. Market Demand The food processing equipment market in Argentina relies heavily on imports by large domestic food processing companies and food exporters. Market growth is largely tied to investment in technology and the expansion strategies of these companies. U.S. products are often sought out, particularly in the higher-end technology segment. Scarce financing available to the local market is an issue. However, U.S. EXIM Bank guarantees and lending are available to the private sector in Argentina. Market Data Market Estimates est est (In US$ thousands) 2010 2011 2012 2013 Total Market Size 175,080 235,840 239,360 243,000 Total Local Production 100,000 105,000 109,200 113,500 Total Exports 49,850 64,560 67,140 69,825 Total Imports 122,200 195,400 197,300 199,300 Imports from the U.S. 26,600 36,000 36,720 37,500 Exchange Rate: 1 USD* 3.80 4.1 4.55 5.05 Note: Statistics are based on Mercosur Common External Tariff (MCET) Codes: 8433.60; 8433.60.90; 8434; 8434.20; 8434.20.10; 8434.20.90; 8435; 8435.10.00; 8435.90.00; 8436.2; 8437; 8437.10.00; 8437.80; 8437.80.10; 8437.80.90; 8438; 8438.10.00; 8438.20; 8438.20.10; 8438.20.90; 8438.30.00; 8438.40.00; 8438.50.00; 8438.60.00; 8438.80; 8438.80.10 8434.80.20; 8438.80.90; 8479.20.00 2011 import market share: United States: 18.4%; Italy: 16.5%; Brazil: 12.5%; Germany: 7.6% Best Prospects U.S. exports may continue to find opportunities in the following specialized areas: equipment for fat and vegetable oil extraction and processing, a subsector which had a 37.5 percent market share for U.S. products in 2011; poultry equipment, which represented a 26 percent market share; and machines for cleaning, sorting or grading seed, grain or dried leguminous Food 2 Processing Equipment Overview vegetables, where imports from the U.S. had a 23 percent market share in 2011. Parts for food processing equipment are also a good prospect for U.S. exports, given the trend to repair existing machines due to the rising cost in peso terms of imports, and the virtual lack of local credit for capital goods. Key Suppliers The main suppliers to the market are U.S., Brazilian, and European companies (Italian, German, Spanish, and French). Together they supply approximately 85 percent of the Argentine food processing market. U.S. technology is recognized for its quality. Traditionally, U.S. suppliers have enjoyed a dominant market share. Local production equipment has increased, driven by the surge of food exports, and increased local consumption, and taking advantage of lower costs of production and a devalued peso. While, in general, it does not compete in the same niche as U.S. higher-end technology, local equipment has improved in quality and is increasingly being exported to neighboring countries. Local production also caters to a stronger demand from small to medium sized companies in the interior provinces of Argentina, since many companies in these areas are not able to face the expenses involved in importing new technology. Prospective Buyers End-users of imported machinery are mainly medium to large private companies. Traditionally about eighty percent of imports are carried out by a group of approximately 50 companies that belong to the food sector. The key end-users can be broken down into seven categories: the meat packing sector; dairy; milling; bakeries; edible oils and fats, beverage processing; production and refining of sugar; and other processes. Market Entry Generally, sales are channeled through an agent-representative established in Argentina. This method is changing, largely due to a concentration of large end-users, who buy directly from foreign manufacturers. However, most companies prefer to deal with an established representative that can ensure in-country maintenance service and parts. Exhibiting at local trade shows and placing advertisements in industry magazines are good avenues to test market potential and identify potential buyers. The Commercial Service of the U.S. Department of Commerce assists exporters in finding the appropriate partners in the local market. Please contact CS Buenos Aires (see contact information below) or your local Department of Commerce Export Assistance Center (1-800-USA-TRADE), for further information on products and services offered. Market Issues & Obstacles Recent controls have made exporting goods from any country to Argentina more difficult as the Argentine government has imposed more processes that Argentine importers must complete in order to import goods. It is important for would-be exporters to Argentina to confirm that their Argentine customer has: A) Received the necessary permission to import; B) Received a non- Food 3 Processing Equipment Overview automatic import license if required; and C) Obtained permission from the Argentine Government to purchase foreign exchange to pay for the import prior to shipping goods to Argentina. For additional information on these measures, please refer to: The Mercosur common external tariff (CET) applies to imports from countries outside the MERCOSUR area (Argentina, Brazil, Uruguay and Paraguay). Last July, the Government lifted the tariff exemption on imports of capital goods, and established an extra-zone import duty averaging 14%. Intra-MERCOSUR tariffs are currently at zero to facilitate trade among the countries of this economic bloc, including Argentina, Brazil, Uruguay and Paraguay. Given that most international brand names are already in the market, local companies are eager to obtain quality products at a more competitive price. Trade Events Envase-Alimentek 2013 Date: August 6-9, 2013 Location: Costa Salguero Exhibition Center, Buenos Aires, Argentina Website: Tecnofidta 2014 Date: Sept. 16-19, 2014. Location: Costa Salguero Exhibition Center, Buenos Aires, Argentina Website: Web Resources Coordinator for Food and Beverage Industries: Association for the Providers of the Food Industry: Include only the name of contact/resource and a website link. If a website is unavailable, include the address, phone and fax number, and email address. For More Information The U.S. Commercial Service in Buenos Aires, Argentina can be contacted via e-mail at:; Phone: 54-11-57774519; Fax: 54-11-57774630; or visit our website: The U.S. Commercial Service — Your Global Business Partner With its network of offices across the United States and in more than 80 countries, the U.S. Commercial Service of the U.S. Department of Commerce utilizes its global presence and international marketing expertise to help U.S. companies sell their products and services worldwide. Locate the U.S. Commercial Service trade specialist in the U.S. nearest you by visiting Food 4 Processing Equipment Overview Comments and Suggestions: We welcome your comments and suggestions regarding this market research. You can e-mail us your comments/suggestions to: Please include the name of the applicable market research in your e-mail. We greatly appreciate your feedback. Disclaimer: The information provided in this report is intended to be of assistance to U.S. exporters. While we make every effort to ensure its accuracy, neither the United States government nor any of its employees make any representation as to the accuracy or completeness of information in this or any other United States government document. Readers are advised to independently verify any information prior to reliance thereon. The information provided in this report does not constitute legal advice. The Commercial Service reference to or inclusion of material by a non-U.S. Government entity in this document is for informational purposes only and does not constitute an endorsement by the Commercial Service of the entity, its materials, or its products or services International copyright, U.S. Department of Commerce, 2012. All rights reserved outside of the United States.
Posted: 29 November 2012

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