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Paraguay Crops
Export Crops
Soybeans had replaced cotton as the country's most important
crop by the 1980s. A relatively new crop for Paraguay, soybeans
were not produced in any quantity until 1967, when they were
introduced as the summer rotation crop in a national plan for selfsufficiency in wheat. After soybean prices nearly tripled in 1973,
however, much of the land slated for wheat was sown with soybeans
instead. As the lucrative nature of soybean cultivation and
processing became apparent, several large agribusinesses from
Brazil, the United States, and Italy engaged in large-scale,
commercial production of soybeans and soybean oil. It is difficult
to exaggerate the drastic growth soybeans enjoyed in Paraguay. In
1970 soybeans covered only 54,600 hectares and had an annual
production of over 75,000 tons. By 1987 soybeans covered some
718,800 hectares, more than any other crop, with an annual output
of 1 million tons and export revenues of approximately US$150
million. The soybean crop grew primarily in the newly colonized
departments of Itapúa, Alto Paraná, Canendiyú, and Amambay.
Soybeans were produced principally for the world market anf sold
both as a raw bean and as a processed oil, which was also consumed
locally. Soybean prices generally rose beginning in 1970s but
experienced significant fluctuations in the early to mid-1980s
before recovering in the late 1980s. The major constraint on growth
in soybean output, besides price fluctuations, was the lack of
storage, drying facilities, and local processing capacity.
Cotton was one of Paraguay's oldest crops, grown since the time
of the Jesuit missions. The government encouraged cotton production
after the crop was nearly wiped out by the War of the Triple
Alliance. Cotton was especially suited to the Paraguayan climate
and soils and was grown primarily by small farmers in the central
region. Cotton farming also experienced extremely rapid growth in
the 1970s and 1980s. In 1970 only 46,900 hectares were sown with
cotton, producing a volume of over 37,000 tons. By 1985, however,
385,900 hectares were covered with cotton, yielding almost 159,000
tons. Those figures had dropped to 275,000 hectares and 84,000 tons
during the drought of 1986. Foreign-owned, large-scale, commercial
production in the eastern border region was surpassing central
region production in the late 1980s. Despite the advances in cotton
production, cotton cultivation in the 1980s was still characterized
by low yields and a low technological level. Even more so than
soybeans, cotton suffered wide price fluctuations, and many small
farmers who came to rely on cotton revenues in the 1970s became
vulnerable to external price fluctuations in the following decade.
Some cotton fiber was used domestically, but about 80 percent of
the country's crop was processed into cotton lint at more than ten
textile-processing factories. Cotton exports in 1987 earned about
US$100 million, with most exports going to Uruguay, Britain,
France, the Federal Republic of Germany (West Germany), and Japan.
Another key export crop was tobacco. Used domestically for
centuries, cigarettes and cigars also earned foreign exchange.
During parts of the early 1900s, tobacco was Paraguay's principal
agricultural export to Western Europe. Tobacco production slowed in
the 1970s with the advent of massive soybean and cotton production.
Another reason for the tobacco crop's decline was the inability of
the domestic cigarette factories to improve quality control and
compete with smuggled brands. Wide price fluctuations of tobacco
also explained dwindling production. Despite these difficulties,
tobacco made a slight recovery in the 1980s. The area cultivated
rose from 7,600 hectares in 1980 to over 8,000 hectares in 1987.
Output increased from 11,500 to 12,000 tons. Tobacco was grown
throughout Paraguay, mostly by small farmers. Cigarettes and cigars
were exported to Argentina, France, and Spain. Tobacco exports were
valued at approximately US$9 million in 1987.
Coffee was another export crop but of much less importance.
Cultivated since the times of the Jesuits, coffee was grown in the
central and eastern border regions for local and export markets.
Most modern coffee production methods derived from the practices of
German colonists in the eastern region. Coffee production boomed in
the late 1970s but waned in the early 1980s. In the late 1980s,
coffee output rose again, following a pattern of fluctuating
production based on price movements. In 1987 approximately 9.2
million hectares of coffee yielded 18.4 million tons of exports
with an estimated value of US$44.7 million.
Sugarcane remained an important cash crop for small farmers in
the late 1980s. Unlike many countries in the Western Hemisphere,
Paraguay saw sugarcane as a crop of the future, not because of its
use for refined sugar and molasses, but as an input to ethanol, an
increasingly popular energy alternative for the country. Sugarcane
was planted in Paraguay as early as 1549 with seedlings from Peru,
and sugar had been exported since 1556. After the devastation of
Paraguay's two major wars, however, local output did not meet
domestic demand until the mid-1900s, after which exports were
revived. Since then, sugar production has fluctuated with price
changes but generally has increased. Paraguay's climate is
appropriate for sugarcane cultivation, but traditional methods and
inefficient small-scale production limited harvests. Besides low
yields, the industry suffered from outdated milling facilities and
high production costs. Sugar production, however, was expected to
be modernized and increasingly commercialized as a result of its
high government priority as an input to an alternative energy
source. Some 65,000 hectares of sugarcane produced 3.2 million tons
of sugar in 1987, including 7,500 tons of sugar exports valued at
US$2.3 million. These figures were highs for the decade.
Numerous crops were grown partially or entirely for their value
as exported processed oils. Oilseeds represented one of Paraguay's
largest agro-industries. One of Latin America's largest oilseed
exporters, Paraguay processed cottonseed, soybean, peanut, coconut,
palm, castor bean, flaxseed, and sunflower-seed oils. Industrial
countries in particular consumed oilseeds as a lower-priced
substitute for more traditional oils, which also were higher in
cholesterol. Some oil was used locally as well. Paraguay also
produced a number of nonvegetable oils, such as tung oil and petitgrain oil. Tung oil, derived from tung nuts, was used as a drying
agent in paints. Petit-grain oil, derived from Paraguay's bitter
oranges, was used in cosmetics, soaps, perfumes, and flavorings. In
the 1980s Paraguay remained one of the world's leading exporters of
petit-grain oil.
Data as of December 1988
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