Porto Alegre, December 05th, 2022 – The Brazilian Ministry of Agriculture (MAPA) justifies the expansion of the GPV for 2023 due to regular rainfall for the next 2023/24 season. SAFRAS & Mercado already pointed to a favorable climate for this off-season since the previous month.
The GPV of major commodities is also expected to increase. The most recent MAPA data on cane GPV brought the first estimate for 2023 in the Ministry’s November update. For sugarcane, the value is estimated at BRL 96.86 billion and must represent an increase of 1.01% over the estimated volumes for 2022 of BRL 95.90 billion, with an increase of BRL 966 million between 2022 and 2023.
In comparison to 2022, there was a downward adjustment of BRL 2.23 billion from the previous month’s estimate, or -2.28%. The decline for 2022 estimates was generalized for other products such as the GPV of grain crops, which fell by BRL 8.40 billion compared to the previous month’s estimate, from BRL 821 to 812 billion. For 2023, the GPV of crops is estimated at BRL 856 billion, up 5.36% from the 2022 data, currently estimated at BRL 812 billion. The same can be said of the total agribusiness GPV, which for 2022 had a downward adjustment of BRL 9.00 billion compared to the previous month’s estimate, which went from BRL 1.179 to BRL 1.188 trillion, or -0.76%.
For 2023, the MAPA’s first estimate indicates values of BRL 1.237 trillion, up 4.93% from the most recent estimated volume for 2022 of BRL 1.179 trillion. The advance of volumes in almost generalized terms in the agribusiness GPV stems, according to the MAPA, from more favorable and regular rains in the coming few months, which must benefit several types of crops, including cane. Since the previous month, SAFRAS & Mercado has released indications of monthly maps of expected precipitation for November, December and January, estimating an off-season with above-average rainfall over cane plantations in Brazil’s Center-South and Midwest regions.
This is in line with the GVP growth of cane for 2023, which must evolve due to the increase in volume, even though international sugar prices have been depreciated due to larger crops not only in Brazil, but also in India and Thailand. In the previous month, SAFRAS & Mercado published its first estimate for the cane production in the 2023/24 season for the Center-South, which must grow by just over 4%, from 545 to 565 million tons precisely due to this climate favorable to sustain the recovery of cane fields. Therefore, it is important to remember that, because of higher volumes, the cane GPV must have new upward adjustments over the next few months, although part of these adjustments must be neutralized due to the decline in international prices.
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