Recently, China and Peru announced the signing of the Memorandum of Understanding between the Ministry of Commerce of the People's Republic of China and the Ministry of Foreign Trade and Tourism of the Republic of Peru on the Substantial Conclusion of the Negotiations for the Upgrade of the China-Peru Free Trade Agreement.

In the memorandum, both sides confirmed the substantial conclusion of the negotiations for the upgrade of the China-Peru Free Trade Agreement, and will accelerate the completion of legal review, domestic procedures and other work, striving to sign the upgrade protocol as soon as possible. They also believe that this will help to further tap the trade and investment potential of both countries.

In addition, Peruvian President Boluarte recently embarked on a five-day state visit to China, and at the "Invest in Peru" event held in Shanghai, the Peruvian President also invited capable Chinese companies to cross the Pacific and invest in Peru, believing that investment by Chinese companies will help Peru enhance its national productivity and competitiveness and better integrate into global value chains, which benefits the Peruvian people and is even more beneficial to trade between the two sides.

As for Peru's coffee industry, China's coffee consumption is growing continuously, and the ability of both China and Peru to increase trade will help boost Peruvian coffee exports and enhance the international influence of Peruvian coffee.

It is understood that Peru has also been developing continuously in recent years. In the first quarter of 2024, its export value reached 16.384 billion US dollars, an increase of 150 million US dollars compared with the same period in 2023. The reason for this growth lies in the increase in mining output, while rising prices of some export commodities, including coffee, fruits and other agricultural products, as well as gold, drove the growth of exports. Among them, the growth rate of coffee was as high as 69%.

In addition, the Chancay Port project in Peru, in which a Chinese company invested earlier, also includes a container terminal and related infrastructure, and will be completed and put into operation in November.

According to the Minister of Foreign Trade and Tourism of Peru, the terminal will export 25% of Peru's total agricultural exports, helping to reduce the transport costs of various goods and enhance the competitiveness of Peruvian products. In addition, thanks to its geographical location and cargo capacity advantages, Chancay Port will become an "important gateway from South America to Asia", and neighbouring countries such as Brazil can conduct international transport through this port, as the transport time from this port to Asia will be shortened by 12 days.

In addition, an earlier coffee industry report pointed out that in the 2023/24 financial year, Peru was affected by the El Nino phenomenon, which led to higher local temperatures, insufficient rainfall and the continued occurrence of coffee leaf rust, affecting the growth of coffee plants.However, in the following quarters, Peru began to shake off the control of El Nino, and coffee production began to recover. It is expected that by the 2024/25 marketing year, coffee production will recover to 4.22 million bags (69 kg/bag).

Although Peru's coffee industry currently appears to have great opportunities for development, it is also about to face a climate crisis. According to forecasts by Peru's National Meteorology and Hydrology Service (Senamhi), Peru will enter winter by July, but this year's winter, due to unusually cold sea conditions, temperatures in coastal areas will be below normal.

However, Peru's coffee-growing regions are basically all located in the country's Andes Mountains and close to the coast, and coffee is grown at altitudes of 1000-1800 m, so the high-altitude mountainous areas will be hit by even colder weather.

Moreover, there is a relatively high possibility that La Nina will return in the second half of the year, which may intensify the impact of the cold weather, with temperatures continuing to drop and remaining below the historical average until September. But May-September is the harvest season for Peruvian coffee, and cold weather will affect the pace of harvesting, and local conditions are fragile, so low temperatures will be a worrying problem.