The Government of El Salvador (GOES) is committed to an open-market economy and has recently led economic diversification initiatives in new sectors such as non-traditional agricultural products (tuna
THIS REPORT CONTAINS ASSESSMENTS OF COMMODITY AND TRADE ISSUES MADE BY
USDA STAFF AND NOT NECESSARILY STATEMENTS OF OFFICIAL U.S. GOVERNMENT
Required Report - public distribution
GAIN Report Number: ES1109
El Salvador 2011 Exporter Guide Report
Ana Elizabeth de Iglesias
Although El Salvador is the smallest country in Central America, it is the third largest economy with a nominal gross
domestic product (GDP) of US$21.8 billion in 2010.
I. MARKET OVERVIEW
A. Current Economic Situation
Although El Salvador is the smallest country in Central America, it is the third largest economy
with a nominal gross domestic product (GDP) of US$21.8 billion in 2010. The Government of El
Salvador (GOES) is committed to an open-market economy and has recently led economic
diversification initiatives in new sectors such as non-traditional agricultural products (tuna,
bakery, snacks, beverages, and dairy products, among others), processed food, distribution,
telecomm services, and tourism. Development in these areas follows a 30 year evolution in the
economy from being agricultural based to one of commercial, retail and financial services. A
glance into sector distribution in recent years confirms the importance of services in the overall
Sector Breakdown: % share of Real GDP
2006 2007 2008 2009 2010
Agriculture 10.0 10.8 11.2 10.8 11.0
Industry 30.1 30.8 24.7 29.1 29.1
Services 59.9 58.5 64.1 60.1 59.3
In terms of distribution logistics, the building of a new US$115 million port in the eastern
province of La Unión will not only boost the economy in that region but will also complement the
Acajutla port in the west. As for telecommunications, following the 1998 privatization of the
sector, market dynamics have provided for interesting statistics. In December 2008, for
example, 100 percent penetration of mobile telephones was achieved. Internet and fixed
telephone line penetration still lag behind, however. Tourism has been on the upswing since the
creation of the Ministry of Tourism in 2004. According to this Ministry, in the last ten years,
tourism has increased over 180 percent.
It is important to note that an element which has allowed for growth in services has been
internal demand, something which has been positively affected by the remittances of more than
2.5 million Salvadorans living in the United States. Data from the Central Bank for 2010 show
an estimated remittance level of US$3.5 billion. UN Development Program (UNDP) surveys show
that an 20-25 percent of Salvadoran families receive remittances from the United States.
Nonetheless, trade is highly important to El Salvador, demonstrated by its free trade
agreements with Dominican Republic, Chile, Mexico, Panama, Taiwan and Colombia, as well as
its membership in the Central American Dominican Republic Free Trade Agreement with the
United States (CAFTA-DR) which went into effect in 2006. In 2010 Central America signed an
association agreement with the European Union that includes the establishment of a free trade
area. With the reduction of import tariffs and removal of almost all non-tariff trade barriers, El
Salvador’s trade has expanded significantly over the last few years. The privatization of the
banking system in the early 1990’s resulted in a financial sector that is recognized as one of the
most efficient in Latin America, and which has created an array of financing options for local
importers. In addition, a good credit standing with foreign suppliers complements the
availability of funds to carry out business transactions. In 2001, El Salvador adopted the U.S.
dollar as its currency, eliminating foreign exchange risks for investors.
B. Current Political Situation
Five parties participate in the political arena, although the top two are the most dominant: the
National Republican Alliance (ARENA) which is a conservative party; the Farabundo Marti
Liberation Front (FMLN), which is a leftist political grouping; the National Conservative Party
(PCN); the Christian Democratic Party (PDC) which is centrist; National Unity Alliance (GANA),
the newest political party and one which embraces centrist principles. ARENA was created in the
early eighties has a pro-business platform. The FMLN is composed of former guerrilla
organizations and was formed after the country’s peace accords were signed in 1992.
On March 15, 2009, El Salvador held presidential elections within a framework of democracy,
transparency and full respect for the Constitution and the rule of law. The winning candidate
was former journalist and CNN correspondent Mauricio Funes of the FMLN (52%). His opponent
was former Police Chief Rodrigo Avila of ARENA (49%). For the last four terms, ARENA had held
the presidency, so the FMLN win marks the first time the opposition was able to secure the
central government in the post war period. President Funes has expressed that free markets
dynamics, past trade policies and amicable relations with the U.S. will continue. Additionally, he
has stated there will be an emphasis on social programs and economic stimulus policies. The
major challenges facing President Funes are:
Moving past lingering public perceptions of FMLN radicalism, as well as party
Private sector misgivings about the FMLN’s intentions;
And the weak international economy.
C. Market Size
El Salvador is densely populated, with population growth averaging 1.69 percent during the last
seven years. Of its 6.1 million people, nearly 61 percent are estimated to live in urban areas
and the average growth of the urban population has been 3 percent in the last 30 years.
According to the 2007 census, the capital city of San Salvador accounts for approximately one-
third of the country’s population. This figure is understandable when one considers that
migration to this city accelerated during the 1980’s as a result of civil conflict, and continued
thereafter due to natural disasters and the shrinking of the agricultural sector. Other than San
Salvador, there are three other major cities: San Miguel, in the eastern part of the country, and
Santa Ana and Sonsonate, in the west. Recent government economic development programs
have targeted the impoverished eastern and northern regions, both of which were damaged
significantly by the civil conflict. The government’s focus in the eastern region has been the
building of the aforementioned seaport in the province of La Unión. The government’s focus in
the northern region has been on a five-year US$461 million revitalization project under the
Millennial Challenge Corporation, which includes job creation, infrastructure development, public
services and value-added agriculture.
El Salvador in Facts and Figures:
Area 20,742 sq. km. (8,008 sq. miles)
Time Zone: UTC - 6
Population under 19 years of age: 2.6 million
Population under 5 years of age: 523,400
Unemployment/Underemployment: 7.1 percent / 28.9 percent (2010)
Inflation: 2.1 percent
Nominal GDP: US$21.2 billion
Distribution of Income or Consumption
Gini Index 52.4
Percentage Share of Income or Consumption
Lowest 10% .7
Lowest 20% 2.7
Second 20% 7.5
Third 20% 12.8
Fourth 20% 21.2
Highest 20% 55.9
Highest 10% 38.8
R/P 10%: Richest 10% to poorest 10%; R/P 20%: Richest 20% to poorest 20%
Source: World Bank, 2007, Multipurpose Household Survey (Encuesta de Hogares de Propósitos
Múltiples EHPM 2010), World Development Indicators
Major Agricultural Products: Coffee, sugar, corn, rice, beans, oilseed, cotton, sorghum;
tuna; dairy products.
Leading Agricultural Exports: Coffee, sugar, tuna, frozen tropical fruit and processed
ethnic foods such as corn tamales.
Leading Agricultural Imports: Wheat, yellow corn, rice, soybean meal, cotton, dairy
products, and consumer-ready products.
U.S. exports of consumer-oriented products reached a record US$92,033 million in 2010.
U.S. Agricultural, Fish and Forestry Exports: $ 430 million (2010)
U.S. Agricultural, Fish and Forestry Imports: $ 236 million (2010)
Source: Salvadoran Central Bank (BCR), CIA World Fact book on-line, USDA-FAS, BICO Reports,
2007 World Development Indicators, World Bank.
Salvadorans spend over 65 percent of their income on food. Households earning US$400 to
US$1,500 per month and above are considered to be in the middle to middle-upper income
classes. There are approximately 460,000 households in this category and 60 percent reside in
urban areas. It is estimated that about 1.2 million people, or 20 percent of the population is
The Salvadoran market may be significantly larger than portrayed by U.S. export data. A high
percentage of El Salvador’s imports of consumer-oriented products are actually registered as
imported by Guatemala. The main reason is that many containers come through Guatemala’s
Santo Tomas port and even though they are in-transit to El Salvador, local customs officials
tally them as Guatemalan imports. Particularly close links with the United States are evident by
the strong commercial relationship between both countries.
D. Advantages and Challenges in the Market
U.S. agricultural and food products are sought U.S. agricultural and food products are
after by Salvadoran’s HRI sector, as they enjoy more expensive than some regionally
an excellent reputation among Salvadoran available food products. Guatemala,
consumers and are renowned for their high Canada, Mexico, Chile, and Mexico are
quality and high food safety standards. strong competitors.
In general, El Salvador in its implementation Lack of awareness of new technologies
and application of regulations is transparent and for food products, such as biotechnology.
open, as it follows and adopts WTO and Codex
guidelines for food safety.
Exposure to U.S. media as well as language, High marketing costs (advertising,
cultural, and commercial ties with the United discounts, sampling, etc) are necessary
States all contribute to positive attitudes to promote new market products.
toward U.S. products
The tourism and restaurant sectors are growing Overall, the Salvadoran economy
and are a dynamic sector for U.S. exports. remains very susceptible to any events
that disrupt tourism and investment (e.g.
an international recession), and
consumers are very price sensitive.
The major retailers are developing increasingly Security is a major concern in El Salvador
sophisticated distribution systems, which will and the local authorities still need to
provide more space and better cold chain improve their security conditions.
technology for high value imports
The implementation of CAFTA-DR has lowered Tariff rate quotas of sensitive products
or eliminated duties for most U.S. food products continue to protect local producers of
products such as poultry, and dairy.
Most of the products stocked on the shelves of Low per capita incomes limit the
Salvadoran retail stores are imported. importation of gourmet products.
Most large importers/distributors are members of the Salvadoran Distributors Association
(ADES; http://www.ades.org.sv). This association manages the relationship of its members with
local retailers, wholesalers, and supermarkets and can provide good information on how to
enter the Salvadoran market.
II. EXPORTER BUSINESS TIPS
A. Business Customs
The successful introduction of products into the Salvadoran market depends on acquiring local
representation and making personal contacts. The advantages of local representation include
market knowledge, up-to-date information, and guidance on business practices and trade laws,
sales contacts, and market development expertise.
Salvadoran business relationships and meetings are, at first, formal. One is expected to use
proper titles, shake hands before and after you meeting, and not use a person’s first name until
a relationship has been solidified. Salvadorans commonly use titles such as Licenciado(a) (title
acquired after completing a BA or law degree), Ingeniero (title acquired after completing an
engineering degree or BS ), or Doctor(a) (title acquired after completing a medical degree or a
PhD). These are followed by the person’s last name (i.e. Licenciado Gómez).
El Salvador tends to be very much a business card society and it is important upon first meeting
someone to exchange business cards with him or her. It is an excellent practice to have a ready
supply of business cards in Spanish.
Breakfast meetings are common and begin about 7:30 a.m. Lunches and dinners can be lengthy
affairs (2-3 hours), so it is advisable to not plan a tight schedule around them. Dinners start
late by U.S. standards, frequently at 8:00 or 9:00 p.m. Lunch is usually at 12:30 p.m. and is
the largest meal of the day.
B. Customer Taste
The four basic foods for the vast majority of the population in order of importance are: tortillas
made from white corn, beans, eggs, and rice. Bread, meat, fruit, vegetables (fresh, canned and
frozen), snacks and juices are readily consumed in varying quantities depending upon income
level. Generally, people living in the city consume more bread and meat and fewer tortillas and
Salvadoran consumers are very familiar with U.S. style food. Most U.S. fast food franchises
have outlets in El Salvador. Food courts located in shopping malls are popular and viewed as a
perfect place to socialize. Delivery service has caught on quickly in this market as well.
As more women join the labor force, there is less time for meal preparation at home. In
addition, domestic servants are finding better-paying jobs in the growing maquila (cut and sew)
industry. As a result, the average housewife is changing her preference towards ready-to-eat or
easy preparation meals, much as what occurred within the United States during the latter half
of the last century.
U.S. foods such as hot dogs and hamburgers are preferred by the younger generation. Ramen-
style soups have fulfilled a niche in the construction and appareal maquila sector. These soups
are a quick and inexpensive lunch for thousands of laborers who cannot afford to pay for a
regular cafeteria meal.
Culturally speaking, Salvadorans have adopted much of the U.S. culture such as music, sports,
fashion, and fast foods.
C. Food Standards and Regulations
El Salvador does not have a specific Food Law that applies to imported foodstuffs. Instead, the
health code is the most widely used instrument to enforce local food safety. The Ministry of
Public Health and Social Assistance (MPHSA) is in charge of all registrations and authorizations
to import, manufacture, and sell foodstuffs and beverages, as well as any raw materials used in
the production process. The most pertinent regulation used to enforce proper health safety
when importing foodstuffs is Section 12/Article 88 of the Salvadoran Health Code. This
particular article states that in order to import any food or beverages its use must be authorized
by a Certificate of Free Sale which is certified by the Environment Safety Department (DSA) of
the MPHSA. Each respective certificate must include the name of the product and its
components. Other products such as fresh produce and products of animal origin are regulated
by the Plant and Animal Health Division (DGSVA) of the Ministry of Agriculture (MAG). For U.S.
products the MPHSA will accept the Certificate of Free Sale issued by a competent U.S. sanitary
authority. The certificate is valid for one year, and it can cover a list of products that can be
annexed to the certificate when requesting the import permit from the MPHSA. For animal origin
products, MAG will accept a simple copy of the original Certificate of Free Sale which will be
compared to the original by the Ministry of Agriculture officials to verify the expiration date and
will be handed back to the importer so that he/she can proceed to the MPHSA to complete the
The GOES has not yet taken the initiative to design a program geared towards the
implementation of food safety laws and their proper enforcement. The main problem has been
attributed to limited resources due to other important needs such as public infrastructure and
social programs. However, local policy makers are beginning to react to criticism by unsatisfied
consumers regarding food safety and quality control. A Consumer Protection Law was ratified
by the National Assembly and has been in effect since April 1996. According to the law, the
Ministry of Economy through the Consumer Protection Agency (DGPC) is the entity in charge of
enforcing all the dispositions stated in this law. The National Assembly has recently ratified an
updated Consumer Protection Law. Under the revised law, the (DGPC) has been designated as
the sole entity in charge of safeguarding consumers from unsafe products.
Most food products are inspected for safety at the port of entry. However, the MPHSA carries
out random testing at the retail and wholesale level to make sure that foodstuffs comply with all
the required health and quality standards. Nevertheless, many unchecked products manage to
reach their final destinations due to lack of human resources and appropriate infrastructure to
control illegal distribution channels.
The trend in food safety in El Salvador is for tighter control and more efficient regulations. The
tendency is towards the use of Codex Alimentarius norms. Meanwhile, Central American norms,
and in some instances FDA norms, are being used until Codex norms are revised and adopted.
1. Labeling Requirements
The MPHSA requires the following labeling information for all products sold in El Salvador:
1. The label should state the nature of the product, composition, quality, origin and general
2. Name of the product: There must be a specific name.
3. Net Content: It must be expressed in decimal metric system units.
4. Ingredients: They should be listed with their proper names, in decreasing order,
according to their importance in the composition of the product. It is not necessary to
identify the percentage of each ingredient.
5. Additives: Must be mentioned by the group it belongs to (for example: antioxidant),
followed by its specific name and its concentration in the final product.
6. Lot identification and manufacturing date: in order to identify the lot, a code can be
used, which must be provided and clarified to the MPHSA. To identify the manufacturing
date, 6 digits must be used (year, month, and day).
7. Expiration date: When a product has limited shelf life, it must be declared on the label.
Labels for food products whose shelf life is between 3 and 18 months must include the
statement “PREFERABLY CONSUME BEFORE”, followed by the day and month. Labels for
food products that expire in shorter periods should state “Expiration Date”, with the day
8. Storage instructions.
9. Manufacturer’s name: The label must include the manufacturer, importer, dealer,
distributor or legal representative of the product, and their respective addresses.
10. Sanitary Registry: The label must declare the number of Sanitary Registry (Reg.
No. D.G.S. El Salvador), issued by the Environmental Health Department, Section of
Food Safety of the MPHSA.
11. Country of Origin.
12. The product must contain the name and address of the supplier in El Salvador in
the form of a sticker, which is usually provided by the supplier or distributor.
El Salvador’s labeling law requires that the product description be in Spanish. There is no
enforcement at this time. However, major retail outlets are requiring stickers with product
description in Spanish to comply with the law. GOES is working on a new regulation that will
begin enforcement of labels only in Spanish for all food products.
In order to determine if a product can be imported with only the standard U.S. label, it is
necessary to examine U.S. labeling norms and compare them to the general norms of the Codex
Alimentarius for labeling of foodstuffs. The National Council for Science and Technology
(CONACYT) is currently working on labeling regulations based on the Codex. Due to lack of
resources the GOES has not enforced this policy and food products with U.S. labels can be seen
throughout the distribution chain. However, the GOES is currently requiring that a sticker in
Spanish that includes a list of ingredients, manufacturing method, and expiration date be used
until the requirement of Spanish-English labels can be fully implemented.
The MPHSA/DSA and the Ministry of Economy/DGCP enforce local labeling regulations. All
products should be properly labeled prior to distribution for human consumption.
Sample-size product labeling requirements are identical to those listed above. However, local
authorities are a bit lenient with this type of product due to the small quantities that are
Bulk packed or institutional size products are required to visibly display the contents and
ingredients either in the container or package.
Nutritional labeling is not required by the MPHSA. The U.S. nutrition label needs to be analyzed
by the Nutrition Department of the MPHSA in order to be accepted. Some locally produced
products at the retail level have nutrition facts in English to comply with U.S. regulations due to
expectations of exporting to the U.S. market under the Central America – U.S. – Dominican
Republic (CAFTA-DR) Free Trade Agreement. According to local health officials, the possibility
of consumers being misled by U.S. labels exists. Since most Salvadorans do not speak English,
local health officials fear they could be basing their opinion on the picture that is used in the
label by U.S. manufacturing companies.
The only requirement for shelf life of a product is the expiration and manufacturing date. The
DGSVA requires a country of origin certificate for all products that are imported to El Salvador.
The GOES does not grant any exceptions under the labeling law. However, in extreme cases,
the MPHSA can analyze a product in order to guarantee consumer health and decide whether
that particular product can be imported for human consumption.
Both Universal Product Code (UPC) and EAN bar codes are acceptable in El Salvador. Bar
coding is rapidly becoming an important instrument in the food business. Currently all local
supermarket chains require that products sold throughout their stores are coded.
When alcoholic beverages are being imported, the label must read: "The excessive consumption
of this product is harmful and creates addiction. Sales to consumers under the age of 18 are
prohibited". This is based upon Article 26 of the Regulatory Law for the Provision and
Commercialization of Alcohol and Beverages. In the case of tequila, the following is also
required: area of production, alcohol grade and manufacturing process.
2. Product Registration
According to the Health Authorities in El Salvador, the following information is required for an
exporter to register a product.
An application must be filed at the Environmental Health Department of the MPHSA, which shall
include the following information:
Petitioner’s name and address.
Description of the product.
Name, address and telephone number of the establishment or factory where the
product is manufactured.
Name, address and telephone of the supplier in El Salvador.
Type of packaging material.
Commercial brand name.
This application must be filed with the following documents:
1. Power of attorney granted in favor of the Salvadoran attorneys or the company
representative in the country, duly notarized at the nearest Salvadoran Consulate in the
U.S. or by notary public.
2. The product registration certificate of the exporting country duly notarized at the nearest
Salvadoran consulate or by Apostille.
3. Product samples: For solid products, the Environmental Health Department requires 3
samples weighing 200 grams each. For liquid products, the MPHSA requires 3 samples of
the product weighing 200 milliliters each.
4. For alcoholic beverages, 2 samples of 200 milliliters each must be presented.
5. For bottled water, 3.785 liters (one gallon) for the physical-chemical analysis and 1
sample of 500 milliliters for the microbiological analysis.
6. A Certificate of Free Sale of the product, issued by the Health Authorities of the country
of origin, duly notarized at the nearest Salvadoran Consulate or by Apostille. It must
contain the registration number of the product and the state in which the product was
7. Functioning license of the local warehouse where the product will be stored. Usually the
local distributor obtains this license.
8. Five labels of the product, which shall specify the ingredients and the expiration date.
3. Import and Inspection Procedure
Usually when clearing a product through customs, a Customs inspector, a Customs policeman,
and a MPHSA inspector are involved in the process. English is the commercial language used
for import documents. On average, it takes approximately three to five days to clear a product
through customs. Most importers use a Customs agent to expedite the clearing procedures. At
this time, there is no appeals system in place for disputed product rejections.
The steps in custom clearance for a prepackaged foodstuff are:
1. Request Import Permit from DGSVA.
2. Once the import permit has been granted by DGSVA, the importer must take the sanitary
registration, packing list, bill of lading, insurance policy, airway bill, shipping information and
product invoices to the Revenue Department at the Ministry of Finance to get the policy for
payment of import tariff.
3. The import permit has to be cleared by Customs, Customs Police and the Regional Organization
for Agricultural Sanitation (OIRSA).
4 Customs Police conducts a product inspection.
5. Once product has been cleared by the Customs Police, it can be withdrawn by the importer.
The Ministry of Hacienda has implemented a system called “Teledespacho” designed to expedite
customs procedures. This system uses satellite technology to allow importers and exporters to
send their commercial invoices, bills of lading, and airway bills through an electronic link or web
to the Salvadoran Customs office to be processed. All Customs agents have access to this
satellite system through an individual personal identification number (PIN) that enables them to
get in contact with Customs. This system is also available to import/export companies that
have offices outside El Salvador. These companies can purchase the software to hook up with
the Customs satellite system to send their product invoices. The Teledespacho system makes it
possible for merchandise to clear customs 24 hours a day, seven days a week.
In addition to Teledespacho, the GOES uses a "self liquidation" process that allows the
presentation, assessment, calculation and payment of duties directly by the importer, without
physical inspection of the merchandise in 85 percent of the cases. Local businesses, importers
and shippers have noticed a big improvement in the operation of Salvadoran Customs since the
initiation of the above mentioned reforms.
MAG recently created an online system to process import permits for dairy, meat and fresh
produce called the Agricultural Food Safety Information System (SISA). Importers have access
to this system with an authorized PIN and no longer have to visit MAG offices to request import
permits. According to MAG, this new procedure is part of a GOES process to expedite import, as
well as export procedures. These procedures are due to increased trade. This system can be
accessed at MAG’s website www.mag.gob.sv.
The Ministry of Health also has an online system to request import permits for food products.
This system can be accessed at the following website: www.gaisa-mspas.gob.sv. Information
of costs for different services such as import permits and product registrations can also be found
at this website.
For additional information please refer to the FAIRS Report 2011 ES1109 at
D. Opportunities and Challenges after the Implementation of CAFTA-DR
WHEAT - Bulk Most of the wheat processed by Bakery consumption has
Wheat – DNS, SRW Salvadoran mills comes from the increased tremendously, mainly
and HRW varieties United States, although some due to the availability of fresh
Canadian wheat is imported. bakery centers in all major
Annual imports of U.S. wheat supermarket chains. Growth in
range from 207,000 to 240,000 convention tourism is also helping
metric tons. In January-August boost consumption of bakery
2011, U.S. wheat imports products at hotels; due to the
reached a record US$49.4 increase of business events.
million. Bakery manufacturers are very
optimistic about free trade and
believe CAFTA-DR is providing
growth opportunity. Ethnic
bakery products exported to the
U.S. are growing
due to the high demand of these
products by the Salvadoran
community residing in the U.S.
RICE - Rough rice El Salvador is not self sufficient in Rice production is decreasing at a
- Milled parboiled rice production and needs to fast pace, not only in El Salvador
rice import from other countries, but also in the rest of the region.
especially the United States, to Under CAFTA-DR, tariffs will be
meet demand. Actual local eliminated and TRQs established
demand is estimated at as follows: 18-year duty phase-
approximately 105,000 metric out, initial TRQ of 61,000 metric
tons of rough rice, of which 30 tons (MT) for rough rice, growing
percent is covered by local by 2% per year and an initial TRQ
production. Typically, El Salvador of 5,250 MT for milled rice,
imports rough rice to keep rice growing by 375 MT per year for
mills the first five years, 1,000 MT
Operating throughout the year. increase in year 6, and an annual
However, small quantities of 325 MT Increase thereafter.
imported milled rice have
recently reached local
supermarket chains to meet
upscale consumer demand. El
Salvador has officially abolished
the use of a price-band
mechanism to assess import
duties for basic grains. CAFTA-DR
established Tariff Rate Quotas
(TRQs) for rice.
CORN - Yellow Since the 1960's, El Salvador has The food-processing sector in El
corn - #2 for been an important market for Salvador is not as developed as it
animal feed and U.S. yellow corn, for its poultry is in Guatemala or Costa Rica.
hard endosperm and animal feed industries. The However, snack food production
corn for snack snack processing industry is also is at the top of the list in this
manufacturing a major importer of hard sector. Yellow corn is a main
endosperm corn. Imports of ingredient in the snack
yellow corn from the United manufacturing process. The
States cover almost all local DIANA and Bocadeli snack brands
demand. produced in El Salvador offer
respectable quality for the price,
and have roughly 75 percent of
the market. In addition, DIANA is
the largest snack producer in
Central America and is already
exporting certain products to
ethnic markets in the United
The poultry and dairy sectors are
also major users of yellow corn
for feed mix.
CAFTA-DR provides for a yellow
corn Tariff Rate Quota (TRQ) of
350,000 metric tons (MT) with a
5 % growth per year with a 15-
year duty phase-out. A fixed part
of the TRQ will
be subject to a performance
requirement, which will be
eliminated in 15 years.
White corn was also granted a
TRQ of 35,000 MT under CAFTA-
DR. There is a growing market for
white corn flour to make tortillas.
SOYBEANS - El Salvador does not produce any Dairy production is increasing due
Soybean meal soybean meal, thus, all demand to government incentives and
must be met with imports. The sanitary regulations that provide
poultry and livestock sectors use protection against contraband
the product as feed. Commercial cheese from Nicaragua and
trade is growing quickly due to Honduras.
the high demand for poultry Soybean meal is an important
products. In January-August ingredient used in cattle feed
2011, soybean meal imports mix. CAFTA-DR provides
reached US$43.9 million. El immediate access for soybean
Salvador's poultry industry is the meal.
most developed in the region and
is quickly increasing production
to supply demand
by other Central American
neighbors, particularly Honduras.
III. MARKET SECTORS
The market expectations for retailing remain positive as it continues to be a key area of the
Salvadoran economy, supported by employment, financial stability and expansion of consumer
Hypermarkets/supermarkets and, convenience stores, coexist with the traditional corner grocery
stores and open-air markets.
There are three dominant supermarket chains in El Salvador: Supermercado Selectos, Walmart
El Salvador and Europa.
Selectos Supermarket is owned by the Calleja Group. This local supermarket chain is made up
of 84 stores. In February 2008, Calleja, together with 9 Central American and Panama
companies joined in a strategic alliance funding Supermercados de Centroamerica y Panama -
SUCAP (Panama and Central American Supermarkets) SUCAP groups 16 different supermarket
chains that combined add up 281 stores in the region whose annual sales reach US$2.2 billion.
SUCAP plans to buy bulk all those product that the companies have in common as a way to get
better prices and benefit the consumer. The members of SUCAP are:
Panama: El Rey, El Machetazo, Super 99; Guatemala: Unisuper/La Torre; Costa Rica:
Perimercados, Automercados; Nicaragua: La Colonia; Honduras: La Colonia; and El Salvador:
Wal-Mart Central America, is the largest retailer in the region with more of 450 stores. In El
Salvador there are 81 stores in three different formats: Despensa de Don Juan, Despensa
Familiar and Hiper Paiz. In September 2005, Wal-Mart Stores Inc, acquired 33.3 percent
interests in Central American Retail Holding Company (CARHCO) from the Dutch retailer Royal
Ahold NV. In March 2006, Wal-Mart increased its interests to 51 percent, CARHCO was changed
to Wal-Mart Central America.
Supermercados Europa, the smallest supermarket chain is also designing strategies to compete
with the retail giants. They procure most of their products directly from suppliers in the U.S. and
South America to avoid local importers, assuring lower prices and gaining a competitive edge
over large supermarkets. They have 5 stores and are planning to open 2 more stores in 2012.
PriceSmart El Salvador, S. A. de C. V. , Is based in San Diego, California and has two sites in El
Salvador - both of which are located in the capital city of San Salvador. Similar to membership
warehouse clubs in the United States, it carries a mixture of groceries, apparel, electronics,
household goods, and automotive parts. PriceSmart's first chosen location (1999) was in the
upscale Santa Elena area, and it initially focused on two market segments: the growing upper
middle class seeking imported goods, and restaurants looking for a source of premium
ingredients/products alongside known staples and local brands. As PriceSmart's presence
became stronger, its offerings appealed to the larger middle class and the second store opened
in the Tutunichapa area. Just a few blocks away from the popular Metrocentro shopping mall, it
was more accessible than the Santa Elena location and it made American imports available to
consumers that were familiar with them via firsthand migration or by proxy through family
members in the United States.
Owner Group and Club Outlets Current New
Calleja, S.A. Selectos 69 5
De Todo 1/ 2 0
Selectos Market 2/ 13 4
Wal-Mart Stores Hiper Paiz 2 0
Despensa de Don Juan 32 0
Despensa Familiar 1/ 47 2
Saca Group Hiper Europa 1 0
Supermercados Europa 4 2
Joint Venture Price Smart 2 0
TOTAL 172 13
1/ Smaller popular area stores
2/located in gas station store
A. HRI Food Service
The GOES views foreign investment as crucial for economic growth and development and has
taken numerous steps in recent years to improve the investment climate. U.S. food franchises
have increased their presence in El Salvador rapidly during the last eight years, including
McDonalds, Burger King, Wendy’s, Pizza Hut, Kentucky Fried Chicken, Bennigan’s, Tony Roma’s,
Chili’s, Asia Grill, China Wok, T.G.I. Fridays, and Starbucks (opened in November 2010). Grupo
Piramide is a Salvadoran franchising operator that also manages U.S. franchises in Guatemala
There has also been a boom in coffee shops/restaurants over the last five years. With some
capital injection, small, independent, family-owned coffee shops are being converted into nice
little restaurants. Salvadorans usually get together at these restaurants for breakfast in the
morning and/or for informal meetings and socializing after work. The boom in this sector brings
more demand for bakery products, dairy products, and more sophisticated drinks such as
cocktails, smoothies, milk shakes, fresh fruits and fruit juices.
The hotel sector has also increased the number of four and five-star hotels enjoying a high
occupancy rate. Also there has been a significant increase in small hotels nationwide. Given a
10 percent average growth rate in tourism, the demand for food products, especially high
quality of U.S. foods should continue to grow.
A. Food Processing
The food processing industry is relatively small compared to Guatemala and Costa Rica.
Snack food production is at the top of the list in this sector.
The DIANA brand produced offers respectable quality for the price, and has roughly 80
percent of the local market and 40 percent of the regional market. In addition, this
company is the largest snack producer in Central America and is already exporting its
products to ethnic markets in the United States.
Other local snack producers are Bocadeli and Ideal. These companies are working hard
to increase market share and offer a wide variety of snacks.
U.S. suppliers can take advantage of the need for ingredients from these snacks
There are also some joint venture investments in food processing by U.S. companies
such as Del Monte, Clamato and Badia Spices who produce locally for the Central
CAFTA-DR has also attracted foreign investment to El Salvador including companies such
as Calvo tuna processor from Spain.
On February 2009, with an investment of US$20 million the Mexican juice group Jumex
inaugurated a beverage plant in Nejapa. Jumex expects that 50 percent of the
production will be exported to Panama and the Dominican Republic.
Sigma Alimentos, a large Mexican meat and deli company, has invested in a pork
processing plant to cover local demand and export to other Central American countries.
Another important industry in this sector is meat processing. There are approximately 10
companies which are members of the Salvadoran Meat Processors Association
(ASICARNE). Imports of U.S. pork meat by this sector have grown tremendously over
the last five years, due to the fact that the Salvadoran population is a large consumer of
On October 2008, the new meat processing plant of Wal-Mart Centro America was
Another significant sector is the dairy industry. Dairy processors in the market offer a
wide variety of products which include cheese, yogurt, and sweet cream. The dairy
industry also has an association called APPLE (Salvadoran Association of Milk Processing
Plants). This sector is already exporting fresh cheeses to the United States.
The bakery industry is the last component of the food processing sector. Bakery
consumption has increased tremendously, mainly due to the availability of fresh bakery
centers in all major supermarket chains and coffee shops demand.
IV. BEST PRODUCT PROSPECTS
Top 10 best product prospects imports from the United States
(Millions of U.S. Dollars)
% Change 2009/2010
Product Description 2009 2010
Red Meats 5,589 7,036 25.89
Breakfast Cereals 2,755 3,179 15.39
Poultry Meat 2,366 4,971 110.1
Fresh fruit 14,641 15,572 6.35
Soybean meal 50,661 57,300 13.1
Fruit and Vegetable 13,025 14,454 10.97
cotton 81,118 82,855 2.14
Hides & Skins 1,000 1,572 57.2
Soybeans 0 3,761
Dairy Products 6,939 7,718 11.2
Source: USDA/FAS BICO REPORT
V. Key Contacts
Agency: Ministerio de Salud Pública y Asistencia Social (Ministry of Health)
Departamento de Saneamiento Ambiental (DSA – Food Safety
Contact: Mr. Arnoldo Rafael Cruz López
Address: Alameda Roosevelt, Edificio Laboratorio
Central Dr. Max Bloch, San Salvador.
Phone: (503) 2210-1615; 2210-1614
Fax: (503) 2271-0363
Agency: Ministerio de Agricultura y Ganadería.
Dirección General de Sanidad Vegetal y Animal
Contact: Mr. Helmer Esquivel
Address: Cantón El Matazano, Soyapango, San Salvador, El Salvador.
Phone: (503) 2202- 0835 ; (503) 2202-0823
Fax: (503) 2534-9911
Agency: Ministerio de Economía (Ministry of Economy)
Dirección General de Protección al Consumidor
(DGPC-Consumer Protection Agency)
Contact: Mr. José Armando Flores Alemán
Address: Calle Circunvalación #20, Edificio Defensoría del Consumidor
Plan de la Laguna, Antiguo Cuscatlán, La Libertad
Phone: (503) 2526-9004
Fax: (503) 2526-9005
Agency: Centro para la Defensa del Consumidor (Consumer Protection Center)
Contact: Ms. Naida Medrano, Executive Director
Address: 11 Avenida Norte BIS #525, Centro de Gobierno,
Codigo Postal 1767, San Salvador, ElSalvador
Phone: (503) 2222-1122
Fax: (503) 2222-2852
Agency: Dirección General de Sanidad Vegetal y Animal (Animal and Plant
División de Certificación Fitozoosanitaria para el Comercio
(Sanitary Trade Cartification Division)
Contact: Mr. Douglas Ernesto Escobar
Address: Final 1 Avenida Norte, Santa Tecla,
La Libertad, El Salvador.
Phone: (503) 2210-1773
Fax: (503) 2534-9841
Agency: Dirección General de Sanidad Animal y
Vegetal (Animal and Plant Health Division)
Division de Inocuidad de Alimentos (Food Safety Division)
Contact: Ms. Guadalupe Diaz Nuila
Address: Final 1a. Avenida Norte y Avenida Manuel
Gallardo, Santa Tecla,
La Libertad, El Salvador.
Phone: (503) 2202-0832
Fax: (503) 2202-0832
Agency: OIRSA – Organización Regional para Sanidad Agropecuaria)
(Regional Organization for Agricultural Sanitation)
Contact: Mr. Edwin Aragón – OIRSA representative
Address: Final 1a. Avenida Norte y Avenida Manuel
Gallardo, Santa Tecla,
La Libertad, El Salvador.
Phone: (503) 2228-7841/2228-7899
Fax: (503) 2228-7823
Agency: Centro Nacional de Ciencia y Tecnología (CONACYT)
(National Council for Science and Technology)
Contact: Ing. Evelyn de Vanegas
Address: Urbanización Isidro Menéndez, Pasaje
San Antonio #51, San Salvador,
Phone: (503) 2226-2800/2226-1623
Fax: (503) 2225-6255
Please do not hesitate to contact the office below for questions or comments regarding this
report or require assistance to export processed food products into El Salvador:
Office of Agricultural Affairs
U.S. Embassy El Salvador
Blvd. Santa Elena Sur y Calle Conchagua
Antiguo Cuscatlán, La Libertad, El Salvador
Phones: (503) 2501-2999 exts. 3414/3412
Fax: (503) 2278-3351