The Portuguese agro-food sector is expected to grow 0.3% in 2016 and 1.8% in 2017, despite the negative impact of Brazil and Angola on exports, according to a study by credit insurer Crédito y Caución.
They said the slow-down in important markets such as Brazil and Angola caused a reduction in exports and investment in the sector which was also impacted by moderation in the growth forecasts for Gross Domestic Product (GDP) (1.0% in 2016 and 1.2% in 2017).
The deflation in 2014 and 2015 also had a negative impact on company margins, “against a background of price wars and stiff competition”, the insurer said.
The meat sector, still suffering from the effects of the Russian embargo, was one of the worst affected.
However, the prices paid to the producers and paid by the consumers continued to increase in 2016, which is expected to have a positive effect on companies’ margins.
According to Portuguese National Statistics Institute (INE) figures from 2014, quoted by Crédito y Caución, the agro-food industry in Portugal is composed of more than 10,800 companies with a turnover of more than €14.8 billion, employing over 104,000 workers.