The conflict between Ukraine and Russia could open a gap for Brazilian agribusiness. According to a projection by Safras & Mercado, a leading consultancy in Brazilian agribusiness, due to the war, the eastern European country reduced the supply of grains in the international market.
According to the consultancy, Brazil has the potential to meet this demand and may export up to R$2.3 billion more in 2022, compared to the previous year. The data were exclusively disclosed to the CNN .
The war in Eastern Europe caused a reduction in the supply of corn and wheat on the international market. Ukraine is responsible for almost 15% of world exports of both inputs. And, according to the consultancy, only three countries would be able to meet the demand: Brazil, the United States and Argentina.
“Ukraine is considered a granary of grain production in the world, especially two products: corn and wheat. The European country is our competitor in these products, which opens up an opportunity for Brazil in terms of exports. In addition to Brazil, Argentina and the United States share the market for these inputs. However, these nations do not have much more surplus to trade with other countries”, emphasizes the sector specialist, Elcio Bento.
In the case of corn alone, Ukraine should stop selling 14 million tons in 2022, according to the projection of Safras & Mercado.
The poor performance is largely influenced by the role of the Russian army in the war, which is destroying agricultural crops in the eastern European country and banning humanitarian corridors in the conflict area to allow the rescue of people and the transport of grain, according to found the CNN .
Thus, if Brazilian agribusiness manages to absorb the global demand for corn, entrepreneurs can profit approximately R$ 1,667 per ton – which would amount to R$ 2.3 billion.
The volume in the sector’s exports may increase even more, if the wheat harvest is taken into account. According to Safras & Mercado, Ukraine is one of the biggest exporters of the raw material in the world.
In practice, the country, which had the potential to export 24 million tons, should sell only 10 million, according to the consultancy.
In the meantime, the United States and the country’s allies are still looking for solutions to release the millions of tons of grain trapped in Ukraine, in order to mitigate a possible food crisis.
THE CNN found that the North American country is trying to open land routes for the flow of grains, which are also blocked in Ukrainian ports by Russia.
Source: CNN Brasil
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