AGRICULTURAL GDP expected to grow 3.2% in 2021, says Ipea

The Gross Domestic Product (GDP) of agriculture should gain strength next year and grow 3.2%, according to an estimate by the Institute of Applied Economic Research (Ipea) released on Tuesday (25).
The projection for 2020, however, was revised from 2% to 1.5%. Despite the improvement in estimates for the crop, from 3% to 3.6% in 2020, livestock should fall 2.8%, mainly due to the 6.3% drop predicted for beef production.
For 2021, Ipea's projection is for growth of 3.2% in crop GDP and 5% in livestock. Corn production is expected to advance 9.1% and soybeanproduction by 10.5%, according to forecasts by the National Supply Company (Conab). For livestock, the prospect is recovery in all segments – cattle, chicken, pigs, milk and eggs – led by the growth of 6.3% of beef.
- Crops in 2020
The performance for agricultural GDP 2020, should be sustained mainly by the crop. This year's highlight was the growth in soybean production (5.9%), rice (7.3%), wheat (41.0%), sugarcane (2.4%) and coffee (18.2%), according to the Systematic Survey of Agricultural Production (ibge).
Among the components of livestock, pork and eggs should contribute to the estimated growth, with 5.2% and 2.8%, respectively.
From January to July, Brazilian exports grew 11% in value compared to the same period a year earlier. Pork (162%), sugar and alcohol complex (59.1%), soy products (30.6%) and beef (161.1%) were the highlights.
As for imports, the ten main agricultural products imported by Brazil showed a 9% drop in value compared to 2019 – the result was pulled by salmon (-35%), malt (-15%) and garlic (-13%).
- Rural Credit
Regarding rural credit, ipea's analysis concludes that interest, delinquency and term conditions remained favorable for the next crop, especially for the small and medium-sized producers, despite the scenario of greater economic uncertainty due to the pandemic.
The volume of credit contracted in July – the first month of the 2020/2021 Safra Plan – reached R$ 23.9 billion, 48.8% more than in July last year. The data point to the continuity of credit expansion, in a solid and sustainable way, with emphasis on costing credit in the coming months.