The uncertainties in the country’s economic scenario should impact the agricultural sector in 2022, according to the Confederation of Agriculture and Livestock of Brazil (CNA).
The organization forecasts a drop in the pace of agribusiness growth next year, when the sector should advance between 3% and 5% compared to 2021. For this year, the sector should close with an expansion of 9.37% compared to 2020, according to the CNA.
The data were released this Wednesday (8) during the presentation of the balance sheet for 2021 and the prospects for 2022 for the agricultural sector.
The sector was largely responsible for the downturn in activity in the third quarter, which led the economy into a technical recession.
Agribusiness dropped 8% as a result of the end of the soy harvest and climatic factors such as the severe drought that hit the countryside this year. These factors should remain a concern, according to the CNA.
Production costs
A point that was reiterated during the press conference and that has affected agribusiness is the high production costs. CNA identified an increase of more than 100% in expenses with fertilizers and pesticides for crops such as soybeans and corn, and the trend for next year is that this scenario will continue.
The variation in operating cost for corn, for example, increased by 65.3%. Next are coffee, with an increase of 63.7% and soy with 62.9%. Among agricultural inputs, herbicides registered an accumulated increase of 372% in 12 months.
For the technical director of CNA, Bruno Lucchi, “inputs increased significantly, the producer had to deal with much higher costs in production,” he said.
The rise in fertilizers and pesticides is the result of bottlenecks in the logistics and production chain of countries that export these inputs. Brazil imports 76% of the raw material, and the main suppliers — China, Russia, Belarus and India — face energy or political crises that affect the production chain.
Factors that must be monitored
The confederation also highlighted factors that have an impact on the sector and should be observed during the next year. Among them is the issue of logistics, the supply of inputs, and the climate phenomenon La Niña.
Lucchi stated that, despite La Niña’s tendency, “anticipation of planting was taken. It is a measure that can result in a good harvest for next year”.
In the international field, the behavior of Covid-19, the bottlenecks in maritime transport, the global supply of inputs, the environmental agenda and international trade must be monitored.
In addition, possible new variants of Covid-19 are on the confederation’s radar, as they could pose a risk to the global economy.
Foreign trade
Despite the potentially negative scenario, CNA’s expectations for exports are positive. According to the confederation, Brazil should have a record grain harvest in 2022, with a production of 289 million tons, 14% more than the 2021/22 harvest.
In this context, exports by the farming should rise 17.5% compared to 2021. On the other hand, the CNA estimates that shipments from the extractive and manufacturing industries will fall, respectively, 26.9% and 1.3%. As for imports, the three sectors should have, respectively, a drop of 14.3% and increases of 14.3% and 3.4%.
As already anticipated with exclusivity by CNN, agribusiness exports hit a record in the accumulated result for 2021 from January to November, reaching the value of US$ 110.7 billion, surpassing the previous record that was related to the whole year of 2018 (US$ 101.2 billion). In comparison with the same period in 2020, the growth was 18.4%.
In 2021, the main products that were exported by the sector were soy in grain, in natura beef, raw cane sugar, soy bran and in natura chicken meat. The main destinations were China, the European Union, the United States, Thailand and Japan.
Together, the five markets accounted for 62% of consumers who purchased Brazilian items. The country where the greatest expansion of foreign sales in 2021 was registered was Iran (71.3%), with revenues of US$ 734 million.
The president of the CNA, João Martins, commented on the Chinese veto of Brazilian meat. For Martins “it was not a sanitary problem, but a market move by China”.
Reference: CNN Brasil
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