Biodiesel industry expected to grow by almost 27% in 2024

Growth should mitigate the projected 5,77% drop in GDP from the soybean and biodiesel chain

29.10.2024 | 16:33 (UTC -3)
Dulcelene Jatobá

The GDP of the soybean and biodiesel chain could fall by 5,77% in 2024, totaling R$521,3 billion. The reduction, after a strong 2023% increase in 22, is linked to the failure of the soybean harvest and its negative impact on agribusiness services. This is highlighted by the survey carried out by Cepea (Center for Advanced Studies in Applied Economics), from Esalq/USP, in partnership with the Brazilian Association of Vegetable Oil Industries (Abiove), based on data available up to the second quarter of this year. The figures also show that the good performance expected for the industry should mitigate the drop in the GDP of the production chain, especially the biodiesel industry, which will see an increase of 26,92%.

Although falling, the GDP of the soybean and biodiesel chain in 2024 should still significantly exceed the pre-pandemic level and should represent 20,8% of the national agribusiness GDP and 4,5% of the Brazilian economy as a whole.

Prices remained unfavorable compared to 2023, but there was an improvement in the second quarter. The estimated drop in relative prices is 17,1%, implying a 21,88% reduction in real income.

Job market 

The estimate for the second quarter of 2024 for the number of people employed (PO) in the soybean and biodiesel chain maintained the downward trend compared to 2023, with a total of 2,24 million workers (a 4% reduction in the comparison between the second quarters).

As a result, the share of the production chain in the agribusiness PO (9,51%) and in the Brazilian economy (2,23%) decreased again. The declines are due to the declines recorded for soybeans (-6,13%) and agribusiness services (-4,78%). In the opposite direction, the inputs segment (1,92%) and agribusiness (17,06%) increased the number of people employed in this same comparison.

Foreign trade 

In the second quarter of 2024, the volume of exports from the soybean and biodiesel chain (fresh soybeans, soybean meal, soybean oil, glycerol, biodiesel and soy protein) totaled 48,98 million tons, a reduction of 3,71% compared to the same quarter of the previous year.

The exported value also fell (-20,87%), totaling US$ 24,24 billion. These figures indicate a slowdown in exports, resulting from the decrease in prices on the international scene, the smaller quantity of soybeans produced by Brazil and the increase in domestic demand.

Between the second quarters of 2023 and 2024, there was an increase in the volume exported to China (2,88%), East Asia (8,56%), the Middle East (18,10%) and Africa (23,17%). These regions, together, represented 75% of the total volume of Brazilian exports from the soybean and biodiesel production chain in the second quarter of 2024.

On the other hand, there was a reduction in exports to other regions, including the European Union (-3,26%), Southeast Asia (-9,89%) and North America (-37,27%), which together accounted for 20,54% of the total volume exported in the period. For the other destinations (“Others”), there was a reduction of 54,60% compared to the same period of the previous year, indicating a decrease in the diversification of export destinations in the specific quarter.

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