There are some important facts that the Brazilian production chain should pay attention to every day during the month of June. This was reported by Marcos Fava Neves, who is a Full Professor at the Faculties of Administration at USP in Ribeirão Preto and EAESP/FGV in São Paulo, and a specialist in strategic planning for agribusiness.
The first fact, considered by the expert to be the most important, is the planting of the crop in the United States. “It is estimated that more than 2.5 million hectares will not be planted with corn due to the rains, which caused prices to rise to the highest level in 3 years and also increase in Brazil. The dates for planting and requesting insurance are closed and the most recent USDA report shows corn with only 67% of the planted area, compared to 96% in the previous 5 years, and soybeans with 39% compared to 79% of the five-year average, with some recovery still possible”, he states.
The second point is the impact of the evolution of African swine flu in China on imports and prices of meat and grains, which should considerably change trade in these products between the countries. In addition, it is necessary to keep an eye on “trade issues between China and the US and, more recently, between the US and Mexico and their impacts on trade flows.”
Fourth, “the progress of reforms in Brazil and the pressure on the exchange rate, which has appreciated again. And fifth, the impact of this isolated case of atypical BSE (mad cow disease) in an elderly animal on Brazilian livestock and its exports. We will not have any problems with the OIE, but MAPA has temporarily suspended exports to China, but I believe that this will be for a short time. What a turbulent period for grains and meat. In June, every day counts!”, he adds.
“In general, the international situation is favorable to Brazilian agriculture, what needs to gain speed is the internal situation, with an increasingly strong movement of organized civil society pressuring the political class to present and approve emergency reforms to correct errors, but also mainly a strategic plan for the country”, he concludes.
