Brazilian agro exports to Latin America soar – 05/08/2023 – Market

Brazilian agribusiness exports, which keep growing each year, started 2023 with higher revenues than last year. From January to April, foreign sales of food and agribusiness by-products, such as cotton, cellulose and wood, already reached US$ 49.4 billion, 4% more than obtained in the same period of 2022.

This value could be much higher, were it not for the average drop in commodity prices. In volume, Brazilian exports grew 11% in the period, as verified by the Sheet based on Secex (Department of Foreign Trade).

External revenues obtained by agribusiness totaled US$ 101 billion in 2020, rose to US$ 121 billion in 2021 and reached US$ 159 billion last year. In 2023, the country has a greater volume of product to be exported, but prices are lower than in 2022.

However, the sector has been affected by the global economic situation. While food exports are up 8% this year, compared to the first four months of 2022, foreign sales of agribusiness products not belonging to the food sector are down 12%.

One of the highlights this year is Latin America, especially the countries in South America. These imported food worth US$ 2.7 billion this year, with an increase of 63% over 2022.

The greater participation of South American countries in the agricultural trade balance increases due to the fall in the grain harvest in Argentina. In addition to increasing imports of products, mainly soybeans, the neighboring country is having difficulties exporting other cereals such as corn and wheat.

Argentine spending increased by 176% with the purchase of Brazilian food this year, reaching US$ 754 million. The strong soy crop break forced Argentina to buy 943 thousand tons of the oilseed in this first quarter in Brazil.

As a result, Argentina, despite being the world’s third largest producer of soybeans, was the third largest importer of the oilseed from Brazil, second only to China and Spain. The crop failure in Argentine crops opened doors for several Brazilian products in South America.

Brazilian sales of corn, wheat and rice to countries in that region increased 379% this year, with revenues of US$ 454 million. Colombia increased corn imports; Ecuador, wheat, and Venezuela, rice. Chile, important in the purchase of meat, was also present in the corn and rice markets in Brazil.

The balance of agribusiness also improves due to the search for new markets. Mexico has already bought 1.1 million tons of food from Brazil this year, 112% more than from January to April 2022. cereal this year. Purchases of rice and sorghum also increased.

Mexico is also opening up the protein market to Brazil. This year, meat exports amount to 74 thousand tons, 20% more than in 2022, according to the most recent data from Secex.

If South America and Mexico increased their participation in Brazilian agribusiness exports, the same did not occur with the large importers. China, by buying the equivalent of US$ 18 billion this year, maintained its participation at 36% in total Brazilian foreign sales of food and products related to agribusiness.

The volume of goods purchased by the Chinese increased by 9% this year, but, due to the average reduction in commodity prices, expenditures grew by just 3.9%.

The European Union, on the other hand, reduced its presence in the Brazilian market. Europeans were responsible for 13.4% of the revenue obtained by Brazil from exports in the first four months of 2023, down from 15.8% in the same period last year. Imports from the bloc dropped to US$ 6.66 billion, down 11%. The bloc’s countries bought more meat and more cereals, but reduced their purchases of coffee and soybeans.

The appetite of the United States for Brazilian beef decreases this year. Even so, food imports by North Americans were stable at US$ 1.59 billion. However, North Americans reduced their purchases of products related to agribusiness, such as wood and cellulose. As a result, the country’s share of total exports in this Brazilian sector dropped to 5.5%, according to Secex data.