Circuito Aprosoja 2016 begins with political-economic analysis and prospects for the next harvest

Dourados, in the south of the State of Mato Grasso do Sul, hosted the first stage of the Aprosoja 2016 Circuit this Thursday (19), a project that reached its third edition with the aim of preparing rural producers, agricultural professionals and others involved in the agricultural sector with information and knowledge for the 2016/2017 harvest.

Around 90 people participated in the event, which took place during the 52nd Expoagro Dourados and was opened by the president of the city's Rural Union, Lúcio Damalia. The representative spoke about the new political moment that Brazil is experiencing, which is one of resumption and renewal of the Brazilian people's hope. Furthermore, he celebrated the results of the agricultural fair.

Esperança

“We have heard a lot about the crisis, but here at Expoagro we have had the pleasure of seeing great movement in sales and the strength of agribusiness in our region”, commented Damalia.

Christiano Bortolotto, president of Aprosoja/MS (Association of Soybean Producers of Mato Grosso do Sul), spoke about the positive results of the 2015/16 soybean harvest and the growth potential of crop areas in the State.

“We used 2,5 million hectares this harvest and harvested 7,6 million tons. Yes, we still have a lot of area for expansion, but for that we need a lot of knowledge, to understand even more about this agriculture, which is dynamic and which does not use the word crisis, but creates solutions and develops”, he stated.

Production costs

The first speaker to share knowledge at this stage of the Aprosoja Circuit was agricultural engineer Mauro Osaki, master in Applied Economic Science from Esalq-USP (Escola Superior da Agricultura Luiz de Queiroz of the University of São Paulo) and PhD in Production Engineering from the Federal University of São Carlos. During the talk, Osaki highlighted the producer's challenges with production costs.

“In terms of productivity, we are similar to the United States. But why did we lose competitiveness?” asked the researcher. According to Osaki, the answer lies in the fact that Brazil faces high production costs, has high cost variation and high expenses with fungicides, pesticides and other inputs.

Furthermore, Brazil's financial costs have very high interest rates, a scenario that is different in the United States. All of this contributes to the North American country achieving higher profitability and productivity than Brazil.

Risks and challenges

“Brazil has doubled spending on agricultural pesticides since the 2009/10 harvest. Added to this, we have a very small margin between productivity indices and expenses with the total and operational cost of the harvest, which is very risky for the producer's pocket”, analyzes Osaki.

Still in the opinion of the expert, who is a researcher at Cepea/Esalq (Center for Advanced Studies in Applied Economics), every year since the 2010/11 harvest, Brazilian profitability with soybeans has been repressed. However, for two cycles, the country has been saved by the favorable exchange rate, due to the rise in the dollar.

Expanding on Osaki's analyses, economist and consultant Flávio Roberto de França Júnior, a specialist in agribusiness and commodities markets for 30 years, presented numbers and, mainly, trends for the 2016/17 harvest.

He highlighted the political-economic volatility, and how this reality has affected agribusiness. “Brazil absorbs a lot of the instabilities of the international market. But currently, the real crisis we face is not external, but entirely internal. Out there, the world is growing, and only Venezuela and Brazil have been lagging behind,” he says.

Economy and prospects

According to França-Júnior, the country has several accounts to “close”, but many numbers “don’t add up”. “Our situation will not begin to be resolved until we adjust the public account. The country is at a standstill waiting for a political decision on the presidency. In the midst of all this we have the possibility of El Ninã, which is a concern for the next harvest. We are going to reap positive results now, but they are still frustrating due to the effects that El Niño caused in the 2015/16 harvest”, adds the specialist.

Despite the worrying factors and tighter margins this year, the gains are still mostly positive. In other words, for him, Brazil has many points in its favor, such as favorable conditions for advance sales, compensatory premiums and an exchange rate favorable to exports.

“It remains for the producer to be able to lock in sales prices, seek attractive values ​​for the acquisition of inputs and increase their market share. We are living in a moment of recovery in our economy”, he concluded.

Presidents Luiz Otávio Britto Fernandes, from the Rural Union of Rio Brilhante and Otávio Vieira de Mello, from the Rural Union of Itaporã, as well as the directors of Aprosoja/MS, Thaís Carbonaro Faleiros and Luís Carlos Seibt, also participated in the event.

Due to weather conditions, agronomist Luiz Antonio Digiovani's flight was changed and there was no time for him to participate in the event. At the Circuit, the agribusiness market manager at the Banco do Brasil Superintendence in Paraná would talk about rural agricultural insurance.