Agricultural growth forecast drops from 3,8% to 2,4% in 2020

The Institute for Applied Economic Research (Ipea) projects that the agricultural sector should grow 2,4% in 2020. The forecast is 1,4 percentage points below the previous assessment (3,8%).

“Even with this reduction, the performance is much higher in relation to other sectors of the economy, which are experiencing a recession caused by the Covid-19 pandemic”, highlights a note from Ipea.

According to Boletim Agro, released by the institute this Wednesday (29), the main reason for the reduction in the estimate is the decline in soybean production due to the drop in the grain harvest in Rio Grande do Sul, as already detected by the Systematic Production Survey Agricultural report made by IBGE.

National soybean production had an estimated increase of 10,4% for the year. This performance will be 6,4%, four percentage points lower according to the new calculations.

In agricultural products as a whole, forecast growth fell from 4,5% to 2,8%. Sugarcane production is expected to grow 1,4%, more than a percentage point below what was initially expected (2,5%). In this generalized scenario of decline, the increase in coffee production stands out, with a growth projection raised from 14,2% to 15,4%.

The assessment considers that the recession will have impacts especially on meat production. The forecast growth rate for this segment fell from 3,5% to 1,1%.

“The beef market, the most expensive protein, may be the segment with the greatest negative impact due to the crisis caused by the Covid-19 pandemic”, describes the director of Macroeconomic Studies and Policies at Ipea, José Ronaldo de Castro Souza Júnior.