Economy

Vaivém: Agribusiness loses space in the Brazilian economy this year

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The heavy costs that fall on agriculture begin to interfere with the GDP (Gross Domestic Product) of agribusiness.

The costs affect the agricultural activity, shorten margins, reduce the production of some products and affect the agro-industry and service activities aimed at the sector.

The result is that agribusiness, after two years of record growth and increased representation in the Brazilian economy, loses ground in 2022.

The share of agribusiness in the total economy, which was 27.7% in the first half of 2021, dropped to 25.5% this year, according to GDP assessment data compiled by Cepea (Center for Advanced Studies in Applied Economics), in partnership with the CNA (Confederation of Agriculture and Livestock of Brazil).

In the first half of this year, agribusiness GDP fell by 2.48%, a drop caused by retractions of 2.71% in the agricultural sector and 1.82% in livestock.

One of the reasons for the contraction in GDP was the increase in input costs. The rise of these products in the semester was 22.5%, which caused a fall of 8.9% in the GDP of agricultural activities within the gate.

The industry, also affected by the rise in costs, fell 0.27%, while the service sector, squeezed by a reduction in activities, retreated 3.21%.

In the agricultural sector, the strong rise of 32% in specific inputs for the sector helped to reduce the 14% of primary agricultural GDP, which measures activities within the gate. Agribusiness and agroservices were also affected.

In the livestock sector, the drop in GDP was 1.82%, mitigated by the reduction of specific inputs for the sector, mainly coming from animal feed.

Agribusinesses and the agro-services segment focused on the livestock sector had greater declines than those of the agricultural sector, according to Cepea and CNA.

Based on these figures from Cepea, but using the IBGE methodology, GDP would have risen 0.64% in the semester, with increases of 0.22% in the agricultural sector and 1.86% in the livestock sector.

The IBGE adopts the criterion of evaluating the volume of production. The GDP of Cepea and CNA reflects the real income of the sector, considering variations in volume and real prices in the calculation.

Beef Brazil lost its leadership at the beginning of the year in the supply of beef to the United States. It remained, however, in third position from January to July.

beef 2 In this period, Brazil was responsible for 17% of the beef imported by the United States. In the same period last year, the volume had reached 9%.

beef 3 Brazilians exported 170,000 tons to the Americans, 197% more than in the same period in 2021, according to data from the USDA (United States Department of Agriculture).

swine Agener União, a company focused on large animals, is creating a specific division for swine. The sector already represents 7% of revenues, but the company, a business unit of União Química, expects a growing evolution.

agribusinessAgricultureexportsGDPleaflivestock

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