Understand the 8% fall in agriculture in GDP

The fall in agriculture in GDP (Gross Domestic Product) in the third quarter reflects a combination of factors that include seasonal effects, a high base of comparison and losses from the adverse weather in the country, indicated this Thursday (2) the IBGE (Brazilian Institute of Geography and Statistics).

The sector fell 8% compared to the three immediately previous months. It is the biggest reduction since the first quarter of 2012, when there was a fall of 19.6%. With the negative impact of the countryside, the national GDP retreated 0.1% between July and September.

According to the IBGE, the decline in agriculture largely reflects the end of the soybean harvest, which also impacted exports. The harvest of the country’s main agricultural commodity is more concentrated in the first two quarters of the year.

Thus, the sector’s production tends to be smaller as of July, explained the coordinator of National Accounts at IBGE, Rebeca Palis.

In the third quarter, Brazil also experienced periods of drought and frost. Together, the extreme factors hampered the planting and productivity of several segments, including coffee, corn and sugarcane.

“Agriculture comes from a high basis of comparison, as it was the activity that grew the most during the pandemic period and, for this year, the perspectives were not so positive, in a year of negative bienniality for coffee and with the occurrence of factors adverse weather conditions at the time of planting some grains”, pointed out the IBGE analyst.

Researcher Felippe Serigati, from the FGV Agro study center, also draws attention to the impact of climate on the sector’s performance. “This took wheat, corn, coffee and vegetables, for example.”

According to the expert, the scenario for agriculture tends to be more positive in 2022, based on better weather conditions. On the other hand, the researcher reports that the sector should continue to be pressured by issues such as rising prices for part of the inputs. Among them are fertilizers and fertilizers.

“The weather maps are more favorable for 2022, but it is obvious that this could change. We are not completely at ease. We also have difficulties in accessing some goods, such as fertilizers,” he points out.

This Thursday, the Ministry of Economy linked the drop in GDP to climate conditions.

“It is essential to distinguish what is economic policy from adverse and punctual climatic factors of nature,” stated the SPE (Secretariat of Economic Policy), linked to the ministry.

“The biggest water crisis in 90 years of history and the occurrence of severe frosts had an impact both on energy-intensive sectors and on sectors that depend on the climate, such as agriculture”, he says.