A Minority of Peruvian Mountain Farmers Benefit From Government Pandemic Programs

The Covid-19 pandemic created a great threat for rose growers in the Peruvian valley of the Callejón de Huaylas in the region of Ancash. Glacier meltwater from the Cordillera Blanca supports irrigation systems in this valley, permitting a long growing season for roses as well as a number of food crops. A rapid response of the government brought relief to some of the growers, principally the larger ones, with greater investments and stronger ties to government agencies and national banks. The smaller growers, whose economic and social ties are centered on local communities, were unable to benefit. 

In late April, the agricultural enterprises in this region and throughout Peru that grow flowers for sale for the domestic and international markets faced what they termed a “terrible crisis” and a “catastrophic” situation. The Covid-19 pandemic menaced Peru, and the numerous deaths in neighboring Ecuador made the risks evident. On 15 March, the president, Martin Vizcarra, announced a quarantine of 15 days, which has since been extended to 24 May, though with the lifting of some restrictions in the regions which are less affected.

Roses from highland Peru, prepared for market (Source: SENASA)

Sales on Mother’s Day—celebrated in Peru on the second Sunday in May, as in the United States, the country where the holiday originated—account for half of the business of Peru’s flower growers, so the prospect of losing this portion of the business created deep concern. The losses could total 20,000 tons of flowers, worth 15 million Peruvian soles, or 4.4 million US dollars. The domestic market is particularly important at present, because flower exports from Peru fell by more than two-thirds in March. María Teresa Oré, a sociologist specializing in water governance at the Catholic University of Peru, told GlacierHub that flower production in Peru has two major sectors, with large-scale export enterprises oriented towards the international market centered on the desert coast, and small- and medium-scale enterprises, largely oriented towards the national market, in the highlands. She added that the highland production is more sustainable because it draws irrigation water from surface sources rather than from  overexploited groundwater basins on which coastal growers depend/

On Friday 1 May, Jorge Montenegro, the Minister of Agriculture and Irrigation in Peru, announced a formal resolution, which lifted the restrictions on travel and commerce for the production, transport and sale of flowers and ornamental plants. The resolution declares these activities to be “essential” to the nation. It emphasized that this measure favors “small producers,” many of them “family enterprises.” He noted that flower production is an “activity which generates permanent employment in rural areas.” 

Government extension agent inspecting rose bushes in Ancash (Source: SENASA)

This announcement, presented in advance of Mother’s Day Sunday 10 May, contains a number of limits. It applies only to formal enterprises, registered with the government, and the retail sale is restricted to home delivery. It specifically excludes street vendors (ambulantes) from participation in sales, and indicates that the strict sanitary guidelines had to be followed at all stages from flower production to final delivery. 

The government stated that these steps would protect producers and consumers from the threat of infection. However, these steps also favor the larger producers (60 percent of the highland flower growers are informal enterprises), and many flower distributors are unable to provide home delivery. Montenegro estimated that this measure would allow about 3,000 of Peru’s flower growers—a bit under 30 percent of the country’s growers, over 10,000 in number—to sell their products.

Roses have been the most popular flower for Mother’s Day in Peru since the expansion of the holiday in Peru in the 1920s, though others, including gladioli, are also widely appreciated. The cultivation of roses has been expanding in areas irrigated by glacier meltwater, including the provinces of Huaraz and Carhuaz in Ancash, where a number of the high peaks of the Cordillera Blanca are located. This loss of Mother’s Day sales impacted them severely. 

The flower sector in Peru anticipated a quick recovery following the government declaration. The wholesale market in Lima showed increased levels of activity on Tuesday 5 May, Wednesday 6 May and Thursday 7 May, with purchasers from regional towns throughout Peru coming to purchase supplies, which they brought back for sale in advance of Mother’s Day Sunday 10 May. There were some reports of sales of roses throughout the country, including in Juliaca, a major town in the altiplano near the Bolivian border, and Tacna, a coastal town near Chile, on 9 May. Oré told GlacierHub that sales were much reduced in Lima. She added that she had spoken with Juan Guarniz, a lawyer for the National League of Irrigation Districts, He told her that “despite the resolution which permitted the sale of flowers,”  the small rose growers in Ancash “faced large losses” because “the demand in cities was minimal.” This limited demand could reflect the economic downturn in Peru because of the pandemic, and the high cost of home-delivered flowers.

A rose farmer in Ancash explains the rose cultivation process (Source: MIDIS Foncodes)

Roses were scarce, though not entirely absent, in Huaraz. Jesůs Gómez López, the director of glacier research at INAIGEM, an environmental institute in Huaraz, told GlacierHub that he saw no roses or other flowers being sold, or given as gifts, in Huaraz for Mother’s Day. He explained, “The movement of goods between provinces is restricted in the whole country. Only the transport of foodstuffs is allowed.” Ana Marlene Rosario, an environmental engineer in Huaraz, told GlacierHub that she and her family missed having roses on Mother’s Day. She added that her sister saw some roses at the main market, though in much smaller quantity than in previous years; they were only available for home delivery, at higher prices than usual. 

An account in the Peruvian press explained how the government-authorized sale of flowers played out for rose growers in the Callejón de Huaylas. The ones who took part, located in the communities of Wiñac, Copa Grande y Wiash in the district of Marcará, were all participants in a government program, Haku Wiñay, which in turn is sponsored by a government agency, FONCODES, the Cooperative Fund for Social Development. Though this project was designed to lift rural families from poverty and extreme poverty by instilling a spirit of entrepreneurship, the program for rose growers has a number of barriers to entry, which fall heavily on the poorest households. The application process for acceptance, for example, requires the presentation of a competitive business plan that required significant skills in Spanish and budgeting. The benefits of the program are distributed unevenly as well, giving the participating farmers, though not their workers, access to loans for greenhouse construction and to technical training. Though the successful farms expand local wage employment, they retain a large share of the profits, exacerbating inequality within the communities. 

The town of Marcará (Source: Angel Camor/Flickr)

When the resolution on 1 May created opportunities to market roses from Ancash in Lima, these larger growers possessed a number of advantages over smaller growers, beyond simple economies of scale, or higher-quality roses, which allowed them to take advantage of this opening. They could more readily document the status as a formal enterprise. They had capital reserves to supply their workers with the masks, gloves and hand sanitizer that were required to meet the stringent sanitary standards. Their contacts with FONCODES staff, including an agronomist in Marcará and an economist in Huaraz, could provide them with advice and support as well. Though their sales to Lima for Mother’s Day  increased revenue to Ancash, and expanded wages for many in early May, this windfall for the largest entrepreneurial farmers in these communities does not match with FONCODES’ stated orientation towards creating employment for the poor and the extremely poor employment, or with the declared emphasis on “small producers.” 

Oré explained to GlacierHub that this inequality builds on a long history of government policies in Peru which favor large-scale capitalized agricultural enterprises, despite the important contributions of small farms to food security and livelihoods. She noted the efforts in recent years of the National League of Irrigation Districts and the Peruvian National Agricultural Convention to achieve greater access to credit for small farms, as well as changes in trade and water policies that would distribute benefits more evenly. 

Barbara Fraser, a Lima-based journalist with long experience in Peru, described similar effects of government policies during the pandemic in Matucana, a small highland district close to Lima, where glacial meltwater, from Pariacaca, also contributes to streamflow and irrigation supplies. She writes:

“I’ve been watching how my organic farming friends up near Matucana have been dealing with it [the pandemic]. They are small producers – they were basically subsistence farmers when I met them about 20 years ago – and they seem to be successfully shifting to home delivery. It wasn’t easy, though – they can only bring products to the edge of the city in their truck, so they needed to team up with someone who had a car and a permit to drive in Metropolitan Lima during the lockdown. They managed – they found a relative, or a relative of a friend, or a friend of a relative, I can’t remember which – and are now taking orders by WhatsApp, making home deliveries and taking payments by bank transfer to the daughter’s account.” 

In both this case and the rose growers in Ancash, these products reach households of middle to high incomes in Lima, whether those who are willing to pay a premium for local organic produce, or those who can afford home delivery of roses from established flower shops, more expensive than the local open-air markets. In this way, the regulations favor wealthier consumers, much as they support larger, more capitalized producers.  

Fraser offered more general thoughts as well.

“The Covid-19 pandemic has shone a harsh light on the disadvantages faced by small agricultural producers, especially in transporting their products to market. It has been easier for large vehicles to get permits to travel to Lima, and small farmers, who rely on smaller vehicles, have had trouble getting their products from the fields to urban markets. Home delivery adds another hurdle, because trucks generally can only travel as far as wholesale markets, so growers must link up with drivers who have smaller vehicles and permits to drive in Lima during the lockdown.”

Martin Scurrah, a sociologist based in Lima, with extensive NGO experience, addressed these issues from a policy perspective. In an email exchange, he told GlacierHub, “the rules governing the procedures to be followed by companies as they resume operating are heavily weighted towards protecting the workers and consumers from possible contagion and for promoting permanent employment with formal contracts, rather than the gig economy.” The rules governing flowers parallel those for foodstuffs, he noted, and added that these new rules build on earlier restrictions on the informal economy, citing the management of public markets as an example. 

Scurrah offered a look forward:

“This is clearly positive from the perspective of defending workers’ and consumers’ rights. However, [the rules] will probably involve increased costs and more complex work procedures, which the larger, more formal enterprises will be in a better condition to undertake, possibly squeezing out the smaller, informal operators. There is clearly a trade-off here between promoting a formal economy with greater protection for rights versus an informal economy generating more employment and less concentrated wealth and income.” 

Ancash farmers prepare a bouquet of freshly harvested roses (Source: MIDIS Foncodes)

The Covid-19 pandemic continues to take a heavy toll in Peru, particularly in the coast and the eastern lowlands, though Ancash has the highest number of cases of the highland regions. The number of infections is increasing; on 6 May, Jorge Montenegro, the Minister of Agriculture and Irrigation, tested positive for the coronavirus, and began a program of social isolation. The government extended the strict quarantine to 24 May, with a gradual reopening of some economic sectors, such as mining and fishing. 

The long-term outcome remains unclear. As Scurrah stated, “The way this plays out will decide whether Peru returns to the previous situation of a largely informal economy with few guarantees or protection of rights or a ‘new normal’ of greater government regulation, more protections and more open unemployment.” The case of the rose growers, where a small group of wealthy and privileged farmers garner a large share of the benefits of public programs at a time of emergency that affects all Peruvians, points toward the latter.

Read More on GlacierHub:

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