For the Mato Grosso Institute of Agricultural Economics (Imea), 2018 was a challenging year for agribusiness in Mato Grosso. “Faced with all the political, economic, dollar variation, truck stoppage and freight tabulation, 2018 was a year of many challenges for major crops and reflected directly in the 2018/19 crop planning.
The meats sector was the one that most suffered from the lack of recovery of the Brazilian economy, considering that the main destination of the product are other federative units of the country, “said Imea Superintendent Daniel Latorraca during a press conference promoted at auditorium of Famato last Thursday (13).
According to the president of the Famato System, Norman Corral, the outlook for agribusiness Mato Grosso in 2019 is growing. “The expectation is good, especially in the main economic base of the state that is soy, with ever increasing demands. Mato Grosso has a history of overcoming, especially in agribusiness, although we still have many problems that need to be solved, such as the difficulties in the disposal of soy. But we have differentials such as the regularity of climate, farmers who know what they are doing, who invest in technologies and are producing more and more, “said the president.
At the press conference, Latorraca highlighted the impact of the commercial war between the United States and China, as Mato Grosso’s economy is all about exporting and producing surpluses to other states. “This impacts negatively on us as we have a very large stock of soybeans in the United States and this can become a tragedy. So everything we say in terms of agriculture remains uncertain, “he said.
The expectation for 2019, according to Latorraca, is that the Brazilian economy resumes economic growth so that the state performs well, not only in meat production for slaughterhouses, but also for dairy products. “For the resumption of the economy to occur there are three main factors: the pension reform, the issue of freight tariffs that has not yet been resolved and all the international tension that is still impacting,” said the superintendent.
For cotton, production is expected to increase by 17%, with boom production increasing by 1.5 million tons. According to Latorraca, the explanation for the increase is the advance of commercialization in 65% of all production that is already sold. First-crop cotton begins to be planted in December, and the second harvest begins in January, which corresponds to a large part of Mato Grosso’s production. “This shows that the producers have managed to at least reduce the cost, which is not the case in soybeans and corn,” Latorraca said.
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For the meats market, the Imea verified that the great expectation is in the export and in the domestic market. In the case of exports, the state was unable to close the 2018 numbers positively. There was a fall in the accumulated from January to November of the total exportation of fresh meat in the state compared to 2017. “In this comparison made nationally, Mato Grosso exports did not grow, so the state was not in the growth of Brazil, a factor that can be justified by the greater logistical difficulty faced in Mato Grosso, especially during the truckers’ strike, “he clarified.
With the consolidation of China (Hong Kong) and Russia’s return to shopping, Imea expects a recovery in Brazilian beef exports by 2019. Another important factor is the maintenance of the dollar at the level of R $ 3.80 that will contribute to exports to take place.
Of the total beef production in Mato Grosso, which has already reached five million heads slaughtered until November, 75% goes to the domestic market and 25% goes to export. Latorraca says that even with the dollar issue, the opening of markets is fundamental to sustain the price of arroba in 2019, but what is expected in fact is the recovery of the Brazilian domestic market. With the resumption of growth in the Gross Domestic Product (GDP), Brazilians will return to consuming more meat per year, since this consumption has fallen a lot in recent years because of the crisis.
“In sum, the expectation is a resumption of economic growth and with the reduction of unemployment, domestic demand for meat will re-grow so that we have a better year for the livestock market,” Latorraca said.
Regarding dairy farming, production is differentiated, with several “actors”, with more than 60 thousand producers, small, medium and large. Mato Grosso has a large milk production, but has suffered with the slowdown in domestic demand. By 2019 the expectation is that both milk and its derivatives will grow again. This year, only the month of October showed growth in relation to the same period of the previous year.
This text was translated by machine from Brazilian Portuguese.