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May 19, 2020

Brazil's Agricultural Gross Domestic Product up 8.6% in 2020

Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.

In spite of the Covid-19 pandemic and the economic crisis it has caused, the agricultural sector continues to be the star performer of the Brazilian economy and that was confirmed by a recently released study conducted by the Brazilian Ministry of Agriculture.

According to the Agriculture and Livestock Confederation of Brazil (CNA), the Brazilian agricultural gross domestic product (VBP agro) will increase 8.6% in 2020 to R$ 697 billion, which is the largest increase in 31 years.

The value of the Brazilian crops increased 10.4% to R$ 462 billion while the value of livestock increased 5.4% to R$ 235 billion. The weather was generally good in most areas of Brazil and record high domestic prices were decisive in increasing the value of the crops. The value of Brazil's wheat crop increased 31.3%, corn is up 17.6%, soybeans are up 16%, oranges are up 9.2%, dry beans are up 8.5%, sugarcane is up 2.5%, and rice, coco, and coffee are up 35.4%.

The livestock sector also saw strong gains due mainly to increased meat exports to China. The value of beef is up 13.2%, pork is up 10.2%, and eggs are up 11.6%

The center-west region of Brazil has the largest agricultural GDP at R$ 218.7 billion followed by the Southeast at R$ 172.3 billion, South at R$ 168.4 billion, Northeast at R$ 66.4 billion, and the North region at R$ 44.22 billion.

The value of Brazil's agricultural exports exceeded US$ 10 billion in April for the first time. This represents an increase of 25% compared to April of 2019. Soybean exports to China was the main factor for the increase. The Minister of Agriculture reported that soybean exports during April totaled 16.3 million tons, which is 73% more than April of 2019.