Brazil Agribusiness Rethinks the Future: Covid-19 Brings Short-Term and Long-Term Changes
As Covid-19 emerged in Brazil in March this year, questions were raised all over the world about the country’s ability to deal with the pandemic while maintaining the production and export of commodities to the world market. To date, Brazil has not let markets down. Nevertheless, the pandemic has created some real challenges for Brazilian food and agribusiness.
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For Brazilian agribusiness, the short-term impact has varied from sector to sector, depending on the extent to which the measures implemented to combat the spread of the virus affected demand. “The negative short-term effects have been felt most by sectors exposed to the domestic food service and fuel markets, while exports have benefited from the significant devaluation of the country´s currency, which has boosted margins and competitiveness,” according to Andy Duff, Head of RaboResearch Food & Agribusiness – South America. But looking beyond the short term, there are likely to be some longer-lasting consequences of the pandemic.
“Global perception of Brazil as a reliable supplier should receive a boost given its strong performance as a producer, processor, and exporter during the crisis. Farmers and companies have had their business models severely tested and have learned valuable lessons that will lead to greater strength and resilience in the future. And finally, consumer behavior and priorities may well alter following the experience of a global health crisis, creating new trends, or accelerating existing ones, in agricultural commodity demand.”
Where to go from here
Andy DuffHead of RaboResearch Food & Agribusiness - South America; Global Strategist - Sugar Read more
Victor IkedaSenior Analyst - Grains & Oilseeds Read more
Matheus AlmeidaSenior Analyst – Farm Inputs Read more
Guilherme MoryaAnalyst - Beverages Read more
Andrés PadillaSenior Analyst - Beverages, Dairy, F&A Supply Chains Read more
Wagner YanaguizawaAnalyst - Animal Protein Read more