Jun 28, 2017
CARACAS, VENEZUELA -- Venezuela, one of the world’s most oil-rich countries has become one of the poorest and most dysfunctional over the last few years. It is a nation in crisis. Over 90 percent of their export earnings are derived from petrochemicals, the price of which has plummeted over the last several years. The low price of oil brings into question how much longer the Petrocaribe Agreement, an oil alliance between Venezuela and several Caribbean states, can last and with it, Venezuela’s influence in the Caribbean and Latin America.
Regardless of its dire finances and rampant food shortages, Venezuela is a large importer of U.S. rice. Last year, they brought in nearly 300,000 MT of U.S. rice and likely even more, as several other countries import U.S. rice and re-export it to Venezuela.
“A collapse of the state in Venezuela is worrisome not only from a humanitarian stance but also for the rice industry, as nearly 10 percent of our exports end up there,” said Brian King, USA Rice chairman and chairman of the USA Rice Western Hemisphere promotion subcommittee. “This week, President Maduro called for an assembly to rewrite Venezuela’s constitution; things could spiral out of control quickly.”
While USA Rice does not conduct activities in Venezuela, it’s an important market that we monitor. We work closely with the USDA Foreign Agricultural Service posted in Caracas, discussing ideas such as the potential for eventual food aid shipments.