Agro sustains Brazilian GDP, points out FPA president

The Gross Domestic Product (GDP) of agriculture grew more than the economy as a whole in 2019 and 2020. The projection for the agricultural sector this year and next was revised upwards by the Institute of Applied Economic Research (Ipea). The previous forecast was for growth of 0,5% in 2019 and the new projection is 1,4%. In the case of 2020, the growth projection ranges from 3,2% to 3,7%, depending on the harvest forecast.

According to the Brazilian Institute of Geography and Statistics (IBGE) released on Tuesday (3), national GDP grew 0,6% in the 3rd quarter, compared to the 2nd quarter. In current values, GDP totaled R$1,842 trillion. Supporting GDP in the first eight months of the year was possible, once again, through agribusiness, as pointed out by the president of the Parliamentary Agricultural Front (FPA), Alceu Moreira (MDB-RS). The deputy mentioned that the good performance of agriculture has been driven by the production of corn, cotton and eggs for the domestic market, combined with the growth in exports to the Asian grain market and the sale of beef, pork and chicken.

“We are increasingly industrializing agricultural products: here we have the refrigerated, processed and food industries that generate millions of jobs in the production and logistics chain. With the opening of markets that the Minister of Agriculture, Tereza Cristina, has done brilliantly around the world, we have the capacity to export and produce even more in the countryside,” said the president.

In 2020, growth is expected to be 2,3%. Historically, agribusiness is responsible for a fifth of the national GDP. According to deputy Zé Mario (DEM-GO), this entire result shows the strength of the agricultural sector. “China was hit by swine fever at the end of 2018, which gave us the opportunity to increase exports. As I always say: Brazil has a way! We still have a long way to go, but the important thing is that we are already overcoming the first stages in such a challenging scenario.”

Family farming accounts for 35% of agricultural GDP. Deputy Zé Silva (Solidariedade – MG) explained that small rural landowners are responsible for producing 87% of cassava in the country, 70% of beans, 46% of corn, 38% of coffee, 34% of rice, 21% of wheat, 60% of milk production, 59% of pigs, 50% of poultry and 30% of cattle, structural foods on the Brazilian table. “Agro represents the international demand in food production very well, but improving communication and technical assistance is still the sector’s biggest challenge. With approval of the Rural Connectivity project in Congress, we will change this reality and benefit 5 million producers in the country,” he said.

GDP is the sum of all goods and services produced and serves to measure the evolution of the economy. The vice-president of the Parliamentary Front for Agriculture (FPA), deputy Sérgio Souza (MDB-PR), highlights that one of the biggest challenges facing agribusiness for 2020 is income, improving access to technology and technical assistance for farmers. “Next year’s motto is that producers must have income and access to 4.0 technology; with this he can improve his production”, he explains.

International scenario – from January to November 2018, according to the National Confederation of Agriculture (CNA), exports reached US$93,3 billion, an increase of 4,6% compared to the same period in 2017. This year, the sector accounts for 42% of the country's total foreign sales and 7,2% of global agricultural exports, consolidating Brazil in third place among the largest food suppliers in the world.

The most prominent products are soybeans, cellulose, soybean meal, beef, chicken and cane sugar. The main destinations for Brazilian agricultural exports are China (29%), the European Union (17,2%) and the United States (6,7%).

Agricultural production – estimates released by the CNA indicate that the Gross Value of Agricultural Production (“from the gate inwards”) is expected to close 2019 at around R$610 billion, the same level as last year. For 2020, the expectation is that the amount will increase by 9,8%, to almost R$670 billion. In the scenario, next year's progress will be driven by livestock farming, whose production value could reach 265,8 billion, 14,1% more than the estimate for this year. In agriculture, the expected increase is smaller — 7,2%, to R$403 billion.