The most recent data on Brazil’s agricultural Gross Value of Production (GVP) for sugarcane in 2020, with values calculated for the month of April this year, point to the value of BRL 61.91 billion, up 2.53% from BRL 60.39 billion in 2019. This level of gain in the annual comparison is well below that observed in the immediately previous month, when projections indicated an increase of 4.45% in the GVP of sugarcane compared to 2019.
Although it did not nominally mention sugarcane in its report, the Ministry of Agriculture (MAPA) points to very favorable climatic conditions for the development of grain crops in the country, justifying the increase of more than 8% in the total agribusiness GVP, which must reach BRL 697 billion in 2020. Sugarcane, on the other hand, still faces problems in the prices of its by-products. Still in April, the market was at the height of the impacts of the social distancing measures that caused strong losses in the prices of ethanol and sugar in the foreign market. Yet, at the end of May, the scenario is not so negative, with intense recovery movements seen in these two products.
Therefore, in the month of June, when the MAPA updates its figures for May, it will be possible to observe a gradual resumption of the sugarcane GVP, which will have the peak of its gains observed in the reports with data relative to June and July. In this context, with the help of the sugarcane GVP, the general GVP of Brazilian agribusiness may continue in its upward trend and breaking records, and only now with the April data (but released in May), the GVP was already the greatest in 31 years, with gains of 10% in crops and 5% in animal husbandry, which justified the previously mentioned increase of 8.6% in the general GVP of agribusiness.
Returning to the most recent data, we observe that between March and April there was a negative adjustment of BRL 108 million, or -0.17%, compared to BRL 62.02 billion estimated for the sugarcane GVP in 2020 in the previous month. The current sugarcane GVP at BRL 61.91 billion for 2020 accounts for 13.40% of the total value of crops estimated at BRL 462.09 billion, which is below the level of 13.68% observed in the previous month. Losses in the participation of sugarcane compared to total crops were relatively stable because this total GVP in crops had a negative adjustment in the margin, at the same intensity in the period, also decreasing 0.48% year over year.
By way of comparison, soybeans, with an estimated GVP of BRL 163.62 billion in 2020, is likely to account for 35.41% of the total GVP of crops, above 35.12% in the previous month, while corn, with BRL 76.61 billion, must account for 16.58%, above the level of 16.80% observed in the previous month. Coffee, with a GVP of BRL 27.46 billion, must represent 5.94% of the total GVP of crops, above the level of 5.87% seen last month.
Looking only at the total GVP of crops of BRL 462.09 billion in 2020, we can see a decrease of 0.48% from BRL 418.69 billion in the previous year. Between March and April, there was a positive adjustment of BRL 8.73 billion, or +1.93% compared to the estimate of BRL 453.36 billion in the previous month. On the side of total agribusiness GVP, which includes crops and animal husbandry, we can see the value of BRL 697.03 billion, up 8.63% from BRL 641.67 billion in 2019. There was a positive adjustment in the margin of BRL 7.05 billion, or +1.02%.