The strong growth of the sector was driven by Chinese demand for food, especially soy
Sputnik – The projection of the agricultural Gross Domestic Product (GDP) of 2020, made by the Institute of Applied Economic Research (Ipea), increased from 1.6% to 1.9%. Good results from soybeans, mainly, would have leveraged the sector.
For the year 2021, the growth projection for agricultural GDP was reduced, after an increase, from 2.4% to 2.1%.
The economist and professor at the Armando Álvares Penteado Foundation (FAAP), Ana Paula Iacovino, in an interview with Sputnik Brasil, stated that the methodology applied by Ipea is what largely justifies the result of the projection on agricultural GDP.
According to her, Ipea calculates and makes comparisons in relation to previous quarters.
“As some of the main crops produced have their production concentrated in the first two quarters of the year, Ipea accounted for these increases, so this improvement is largely due to this concentration of production in some of the main Brazilian crops, such as soybeans, corn, coffee. So this study by Ipea is showing the result of these crops “, he explained.
Commenting on the reasons for the increase in the projection, the expert said that some factors contributed to the positive result, with soybeans as the main locomotive in the sector.
“From internal issues such as the good productivity of producers, as well as the increase in international consumption, mainly driven by the high Chinese demand”, argued the economist.
Ana Paula Iacovino pointed out that “the replenishment of Chinese food stocks has increased soy consumption and this has caused international demand to increase and push prices up”. In addition, she stressed that there was a “reduction in the production of an important Brazilian rival, which is the USA”.
According to the expert, there was a combination of favorable factors for the good results of soy, which made the product “pull the chain as a whole”. One of these factors was the rise in rice prices.
“Part of the increase in rice prices was due precisely to the fact that part of the rice producers switched production to soybeans, because soybeans were more interesting. This caused the rice supply to suffer and there was an increase in prices. product, “he said.
The economist also mentioned products such as coffee, corn and wheat, which had good results with heated demand and increased productivity, and pulled the result from the chain’s average, thus increasing the projection.
“Livestock, in turn, is a segment that we do not have such a positive outlook for. Despite the fact that pig production has remained high, but that cattle are not so much”, he added.
According to her, this year of the pandemic is being an atypical year in every way, but “the food production segment has been doing well, because there has been an increase in food consumption, both in the domestic and international markets” .
“So this sector is once again showing its importance, both in its concrete role as a food supplier for Brazil and for the rest of the world, and in the financial issue of Brazil, contributing to reduce the shock of the decrease in global GDP”, completed.
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