Sustainable nut farming
Sustainable nut farming
Business Model Description
Cultivation of nuts, especially pistachios, applying a business model based on sustainable practices and with a strong commitment to innovation.
How is this information gathered?
Investment opportunities with potential to contribute to sustainable development are based on country-level SDG Investor Maps.
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Country & Regions
- 25 de Mayo City
- San Martin
- Pocito City
- Rawson
- Sarmiento City
Sector Classification
Food and Beverage
Development need
Investing in agriculture is one of the most effective ways to produce food, contribute to growth in the food value chain, promote agricultural productivity and improve environmental sustainability. San Juan has a long tradition of agricultural production despite the fact that only 2.4 % of its territory is suitable for agricultural development. (2)
Policy priority
The Government of San Juan has a set of policies and programmes to promote investment in agriculture and its entire value chain, comprising a wide range of small and large-scale activities including agricultural inputs, processing, storage, distribution, wholesale and retail sales and export of agricultural products.(2)
Gender inequalities and marginalisation
In San Juan Province only 21% of agricultural holdings are run by women. Women's participation is concentrated in smaller farms, with 52% of these farms being up to 5 hectares in size (3).
Investment Opportunities
Attracting responsible consumers. This stakeholder group is increasingly demanding organic, healthy and low environmental impact products. Reducing food waste is certainly another opportunity for companies in the sector. Finally, the circular economy has become a key issue for many companies in the sector (4).
Bottlenecks
The environmental challenge has a clear impact on companies; the agri-food sector is responsible for 34% of total greenhouse gas emissions worldwide. The commitment to renewable energies, energy efficiency and ecological production are key to reducing these negative consequences on the environment (4).
Food and Agriculture
Development need
Increased agricultural productivity is crucial for food security, rural development and the conservation of natural resources. (1)
San Juan is the 4th best place in the world for the production of the so-called green gold"", the pistachio, and the largest producer in Argentina (5).
Policy Priority
The Government of San Juan has a set of policies and programs to promote investment in agriculture and its entire value chain, comprising a wide range of small and large-scale activities including agricultural inputs, processing, storage, distribution, wholesale and retail sales and export of agricultural products.(2)
Gender inequalities and marginalization
In the Province of San Juan only 21% of agricultural holdings are run by women. Women's participation is concentrated in smaller farms, with 52% of these establishments being up to 5 hectares (3).
Investment Opportunities
The commitment to renewable energies, allowing to achieve energy independence is key to reduce the negative consequences on the environment. As well as the improvement of drip irrigation systems and the supply chain, especially in the services provided by machinery during the harvest.
Key bottlenecks
Argentina's economic and exchange rate situation hinders investments especially in the long term that are necessary to implement tools and improvements that allow for sustainable cultivation.
Agricultural Products
Pipeline Opportunity
Sustainable nut farming
Cultivation of nuts, especially pistachios, applying a business model based on sustainable practices and with a strong commitment to innovation.
Business Case
Market Size and Environment
USD 100 million - USD 1 billion
The global pistachio market was valued at USD 3907.07 million in 2021. Considering a CAGR of 3.7% considering the period 2021-2029, it is expected to reach USD 5282 million by 2029 (7). Taking into account that the sales value per kg is USD 9 and the expected demand exceeds 400,000 tons.
Indicative Return
20% - 25%
According to estimates of companies that have prepared investment project reports for the sector and information provided by the Argentine Chamber of Pistachios.
Investment Timeframe
Long Term (10+ years)
The ideal ripening stage of pistachio to obtain high yielding crops is achieved after the 8th years
Ticket Size
USD 500,000 - USD 1 million
Market Risks & Scale Obstacles
Capital - CapEx Intensive
Market - High Level of Competition
Impact Case
Sustainable Development Need
San Juan is considered an important agricultural producer, but has not yet implemented sufficient sustainable practices to reduce its environmental impact.
Gender & Marginalisation
In the Province of San Juan, only 21% of farms are managed by women. Women's participation is concentrated in smaller farms, with 52% of these farms being up to 5 hectares (3).
Expected Development Outcome
Increase the area cultivated with sustainable practices that reduce environmental impact. An increase of 1,500 hectares per year is expected until 2026 (7).
Gender & Marginalisation
Increase the number of women's jobs on farms and enable them to occupy managerial and leadership positions, requesting that investing companies have gender management policies in place.
Primary SDGs addressed
12.6.1 Number of companies publishing sustainability reports
> Currently, 0% of the companies dedicated to pistachio cultivation in the Province of San Juan prepare sustainability reports.
> It is expected that by 2030, 40% of the companies dedicated to pistachio cultivation in the Province of San Juan will prepare and publish their sustainability reports.
12.a.1 Installed renewable energy-generating capacity in developing countries (in watts per capita)
> In 2022 the share of renewable energies in installed power was only 11.8% in relation to the rest of the energy sources.(9)
> It is expected that by 2030, the share of renewable energies in installed power will be 40% in relation to the rest of the energy sources.
6.4.1 Change in water-use efficiency over time
> Except for drip irrigation, only 10% of the companies have made significant changes in order to make efficient use of water.
> 70% of companies are expected to apply tools that allow them to make water use more efficient, mainly by applying new technologies such as sensors and drones.
Secondary SDGs addressed
Directly impacted stakeholders
Corporates
Gender inequality and/or marginalization
Planet
Indirectly impacted stakeholders
Public sector
People
Outcome Risks
> Changes in regulations that make it difficult to export production, since 90% of the crop is shipped abroad.
> Lack of resources and/or inputs or limited access to them in the local or international market.
Impact Risks
Efficiency risk: The expected impact could have been achieved at a lower cost due to exchange rate increases in the price of inputs.
Risk of unexpected impact: Adverse weather conditions such as drought, hail or strong winds may complicate pistachio production.
Impact Classification
What
Positive and important result for the stakeholders, by increasing the cultivated area and achieving economic and environmental improve
Who
Pistachio producers and the planet will benefit from positive results.
Risk
Loss of economic growth, people out of work and loss of opportunity to improve the environment.
Enabling Environment
Policy Environment
The Government of the Province of San Juan has included the cultivation of nuts, especially pistachios, in its strategic plan, with programs and projects that promote its industrial development.
Financial Environment
Financial incentives: From the Ministry of Production and Economic Development of the Province, incentives are granted for the installation of new companies that take into account sustainable development models, under the modality of Non-Refundable Contributions and credits with very competitive rates.
Other incentives: Tax incentives: Gross Income Tax reductions and exemptions for agricultural activities. In addition to tax incentive programs such as those managed by the San Juan Investment Agency with tax bonds in order to encourage sustainable investment projects.
Regulatory Environment
Resolution 392/2005 issued by the Secretariat of Agriculture, Livestock, Fisheries and Food to create the seal "Argentine Food, a natural choice" and the "Argentine Food" award to distinguish products that stand out for their quality.
Law 26967 approves the creation of the seal "Alimentos Argentinos, una elección natural"(Argentine food, a natural choice), which is already in place in pistachio-producing companies in the province, in order to endorse the quality of the products in an immediately visible way, allowing consumers to make their choice among the goods offered.
Provincial Tax Law 2023 No. 2485-I, which establishes differential tax rates and tax exemptions for agricultural activities.
Marketplace Participants
Private Sector
Argentine Chamber of Pistachios and its more than 20 associates in the Province of San Juan, such as Pisté SRL, Frutos del Sol SA, DKN Argentina SRL, among others. In addition, input and service suppliers that are part of the value chain of the pistachio sector.
Government
Government agencies such as the Ministry of Production and Economic Development, state companies such as Calidad San Juan, San Juan Investment Agency, INTA, Dirección General de Rentas among others.
Multilaterals
Financial entities and other organizations that will provide support to the sector with different lines of credit.
Target Locations
25 de Mayo City
San Martin
Pocito City
Rawson
Sarmiento City
References
- (1) "Closing the Gap" Program for Gender Equality in Agriculture and Social Development. 2009 - FAO (Food and Agriculture Organization of the United Nations)
- (2) Investor's Guide "Doing Business in San Juan" - Government of the Province of San Juan - 20
- (3) Statistical Dossier "Argentine Agricultural Women" INDEC (National Institute of Statistics and Census) based on information obtained from the National Agricultural Census 2018.
- (4) The Agri-Food Sector: Contributing to the 2030 Agenda - Global Compact Spanish Network.
- (5) Publication sanjuan8.com 17/08/2022 "The fourth best place in the world for pistachio production".
- (6) Market report prepared by Data Bridge - databridgemarketresearch.com
- (7) Interview with the Argentine Chamber of Pistachios.
- (8) Annual Report 2022 CAMMESA ( Administrative Company of the Wholesale Electricity Market