Bolivia's Agricultural Wealth: Exploring Cash Crops

Bolivia's cash crops include soybeans, cotton, sugar, and coffee. In the 1980s, soybeans were the most lucrative legal cash crop in the country. By the late 1980s, soybeans had become the country's most important oilseed crop, with an annual production of about 150,000 tons. Coffee was the second most important agricultural export after timber. Bolivia has been self-sufficient in sugar production since 1963, and it is a significant cash crop for both the domestic and export markets. Cotton, which was a boom crop in the early 1970s, has seen a decline in production since 1975 due to various factors. Other cash crops of lesser importance include tobacco, tea, cocoa, and oilseeds such as sesame, peanuts, castor beans, and sunflowers.

Soybeans: Bolivia's most lucrative legal cash crop in the 1980s

In the 1980s, Bolivia's economy was heavily reliant on the production and export of agricultural goods, with the sector contributing to approximately 23% of the country's GDP in 1987. During this decade, soybeans emerged as the country's most lucrative legal cash crop.

The rise of soybeans in Bolivia can be traced back to the early 1970s when an increase in the world price of soybeans sparked interest in their cultivation. By the late 1980s, soybean production had become a significant economic activity for the country. In 1988, soybeans were cultivated on approximately 65,000 hectares of land, yielding about 150,000 tons of soybeans. This marked a substantial increase from a decade earlier when only 19,430 hectares were dedicated to soybean production, resulting in 26,000 tons.

The soybean harvest in Bolivia served multiple purposes. About one-third of the harvest was used domestically by the poultry industry in the form of soybean meal. Additionally, soybean meal was exported to Peru and Western Europe, while raw soybeans were transported via rail to Brazil. To meet the local demand for soybean oil, Bolivia maintained a crushing capacity of 150,000 tons in 1988.

The success of soybean production in Bolivia during the 1980s can be attributed to several factors. Firstly, the crop was well-suited to the country's agricultural conditions. Secondly, the dynamism of soybean cultivation provided farmers with better access to credit compared to producers of other legal cash crops. Moreover, the strong organisation of soybean farmers played a crucial role. The National Association of Soybean Producers (Asociación Nacional de Productores de Soya—Anapo), a powerful association, advocated for the interests of soybean growers and facilitated the construction of new storage facilities with assistance from the United States Agency for International Development (AID).

In summary, soybeans were a vital component of Bolivia's economy in the 1980s, offering opportunities for both domestic utilisation and international trade. The expansion of soybean production during this period underscores the crop's significance as a lucrative legal cash crop for the country.

Coffee: the second most important agricultural export after timber

Coffee is Bolivia's second most important agricultural export after timber. In 1988, coffee production in the country reached 13,000 tons, nearly double the 1987 output, which was impacted by disease in western Bolivia. Over 20,000 hectares of land were dedicated to coffee cultivation, with small farmers in the valleys and large farmers in the lowlands making up most of the coffee producers.

Bolivia consumed 25% of its coffee crop locally in 1988, exporting the rest both legally and clandestinely. Legal exports of coffee that year totalled 102,000 sixty-kilogram bags, equivalent to over $15 million and the country's export quota for 1988. As a member of the International Coffee Organization (ICO) since 1968, Bolivia was permitted to export 170,000 sixty-kilogram bags in 1989. However, approximately 25% of coffee exports left the country illegally in the late 1980s.

The Bolivian Coffee Committee (Cobolca), an autonomous government agency established in 1965, played a crucial role in the coffee industry. Cobolca was responsible for running model farms, controlling diseases, and allocating ICO quotas to its members, who were mostly commercial farmers. The coffee industry also received technical assistance from the Bolivian Institute of Coffee, which helped control diseases and manage model farms.

Coffee holds particular importance in Bolivia as the primary substitute crop offered to coca growers under the eradication program.

Sugar: a significant cash crop for both domestic and export markets

Sugarcane has been cultivated in Bolivia since the colonial era, and in the 1980s, it was a significant cash crop for both the domestic and export markets. In 1988, Bolivia's sugarcane cultivation spanned 62,000 hectares, resulting in a production of 140,000 tons of sugar. This marked a decline from the previous year, as farmers opted for more lucrative crops, such as soybeans, due to falling sugar prices.

The sugarcane industry in Bolivia faced several challenges, including poor management, dwindling yields, and inadequate quality control. In 1988, the country's six sugar mills were operating at only 37% of their capacity. Additionally, sugarcane was also processed into methanol, which was sold domestically and exported. Despite the liberalization policies of the late 1980s, Bolivia maintained strict controls on sugar imports.

The price of sugar had experienced a surge in the mid-1970s, leading to an increase in the number of hectares under sugarcane cultivation. However, as sugar prices declined, farmers began seeking alternative crops. The decline in the sugar industry was also attributed to poor management, decreasing yields, and a lack of quality control.

Sugarcane cultivation in Bolivia has a long history, dating back to the colonial era. In the 1980s, it played a significant role in the country's economy, catering to both domestic consumption and export opportunities. However, the industry faced challenges due to management issues and competition from other crops, resulting in a decrease in production.

Cotton: a boom crop in the 1970s that declined in the 1980s

Cotton was a boom crop in Bolivia in the early 1970s, but its production had declined by 1975. Grown mostly in the Santa Cruz Department, cotton covered 54,000 hectares in 1975 but only 9,000 hectares in 1988. This decline in cotton cultivation was primarily due to price fluctuations, with farmers opting for more lucrative crops such as soybeans when cotton prices dropped. Insect problems, disease, and lack of credit also contributed to the decline.

The shift away from cotton had significant economic implications for Bolivia. Cotton farmers in Santa Cruz, an important constituency, had traditionally received highly favourable credit terms. However, when cotton growing became unprofitable, many defaulted on their loans, leaving the government's Agricultural Bank of Bolivia in a precarious financial situation by the late 1980s. The decline in cotton production also impacted the country's cotton mills, which operated at less than half their capacity during this period.

Bolivia's experience with cotton highlights the challenges of an economy heavily dependent on natural resources and susceptible to market fluctuations. The country's efforts to diversify its economy and manage the impact of volatile commodity prices have been ongoing.

Coca: an illegal but highly profitable crop, with one-third of the world's coca grown in Bolivia in the 1980s

Coca, a tea-like shrub, has been cultivated in Bolivia for centuries. In the 1980s, coca was Bolivia's most lucrative crop and economic activity. The country was the world's second-largest grower of coca, with one-third of the world's coca being grown in Bolivia during this period.

Coca leaves are processed clandestinely into cocaine, and Bolivia supplied approximately 15% of the US cocaine market in the late 1980s. The export of coca paste and cocaine generated an estimated $600 million to $1 billion annually in the 1980s, surpassing the country's legal exports. The Bolivian government estimated that coca production expanded from 1.63 million kilograms of leaves covering 4,100 hectares in 1977 to a minimum of 45 million kilograms over an area of at least 48,000 hectares in 1987. The number of growers increased from 7,600 to at least 40,000 during this time.

The expansion of coca cultivation in Bolivia led to US-backed efforts to criminalize and eradicate coca as part of the War on Drugs. However, these eradication efforts had limited success and faced resistance from coca growers, who advocated for policies of "social control" over coca growing. The lucrative nature of the coca crop, combined with the economic crisis in Bolivia during the 1980s, made the risks associated with coca cultivation worthwhile for many Bolivians.

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