New data for January this year confirm the expectations from SAFRAS & Mercado, which had already warned of the potential for sharp growth in cane GPV for 2022. Highs must still be observed over the year.
The latest MAPA data on the cane GPV shows strong annual and monthly growth for the culture. For the year, the gains hit 31%, with the values of 2022 at BRL 117 billion contrasting with last year’s BRL 89 billion. However, in the margin, between December 2021 and January 2022, there were considerable advances, going from BRL 96 to 117 billion, up 21% in the adjustment between what was expected in December last year and what was expected in January this year. In the previous month, SAFRAS & Mercado, when the cane GPV had suffered a downward adjustment of BRL 2.0 billion, anticipated a rise in the cane GPV throughout 2022. Our estimate fluctuates at BRL 130 billion at the end of the year. 2022, while the recent change from BRL 96 to BRL 117 billion only reaffirms this trend.
The reasoning comes from the expectation of partial reoccupation of the cane crop for the 2022/23 season, which must go from 520 to 560 million tons. Rainfall has been very regular in the Center-South since November 2021 and tends to be relatively frequent until March 2022. From April onwards, the rainfall tends to decrease, which will allow for the regular progress of the harvest after a rainy off-season. Therefore, the greater volume of cane will allow for the growth of the GPV in the same way that the reference prices show some lows in both sugar and ethanol. If not for the downward pressure on prices both in the external and internal scenarios, the gains in the cane GPV would exceed BRL 150 billion.
The GPV of crops also grew in the margin, going from BRL 816 to 867 billion, with an increase of 6% between December and January, or BRL 50 billion. That is why the share of cane in the GPV of crops has remained around 13%, as both cane and total crops have grown. The same can be said about the total GPV of agribusiness, which went from BRL 1.16 to 1.20 trillion, rising 3% in the margin or BRL 43 billion. As for cane, the Ministry of Agriculture (MAPA) is succinct in its comments, only classifying it as a part of the commodities with a favorable share in the advancement of the GPV. On the other hand, the negative contributions, according to MAPA, are related to reductions in the quantities produced.