With exports with an increase of 27.6% in October, when compared to September, and totaling US$ 22.52 billion, based on data from the Foreign Trade Secretariat of the Ministry of Economy, FGV Agro forecasts that the trade balance hit a record with the summer crop in 2022. Given the trend to regularize the rainfall regime and with the expectation that the real will remain devalued against the dollar, agricultural commodities should boost exports.
Important agricultural products that were affected by weather conditions in the second half of the year, such as corn and sugar, may recover in the next harvest, according to the researcher at the Agribusiness Center at FGV, Felippe Serigati. In October alone, corn had a 53% drop in sales abroad.
For next year, it is also estimated that the commodities keep holding the positive results. Only iron ore may suffer fluctuations due to the slowdown in the Chinese real estate market, impacted by the crisis at the construction company Evergrande.
Red meat, which also fell in the last survey, may have positive results in 2022. With a 38.5% reduction in exports in October, sales were mainly impacted by the Chinese embargo on Brazilian meat, due to the detection of two cases in the country of the disease known as “mad cow disease”, which affects the cattle herd.
“We have the United States and Uruguay as competitors. In the United States it is more expensive. Uruguay cannot keep up with the demand, so it is more likely that, sooner or later, China will return to negotiations with Brazil, asking for a fairer price, perhaps”, explained Serigati.
The researcher also highlighted that the trade balance surplus is mainly due to the devaluation of the real against the dollar, which favors the price of commodities, and not necessarily to a real increase in the volume of exports. In the October balance, soybeans (90%), ingots and other primary forms of iron or steel (80.7%) and crude petroleum or bituminous mineral oils, crude (114.3%) pushed the expansion of exports.
Exports to China, Hong Kong and Macau grew 14.3% and totaled US$ 5.99 billion. For Argentina, the country’s third largest trading partner, they rose 37.6% and accounted for US$ 1.13 billion. For the United States, they totaled US$ 2.99 billion with more than 52% increase. As for the European Union, exports increased 28.9% and reached US$ 2.93 billion.
New scenario in the second half of 2022
Exports may undergo a change of scenery in winter. Important products such as corn, wheat and coffee may be harmed in the second harvest, which can generate more expenses and less exports.
“In addition to climate issues, you have difficulty accessing production inputs, such as fertilizers and chemicals. They are more expensive and the producer will not always be able to have a good harvest without passing on this cost. It is a risk”, pointed out the researcher.
*Under supervision of Stéfano Salles
Reference: CNN Brasil
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