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Brazil Agribusiness Report Q3 2010

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No. of Pages : 79
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BMI View: Despite consistent growth in population and domestic incomes, Brazilian agricultural production will continue to rely extensively on exports. We expect growth in almost all sectors, with soybeans, poultry, corn, coffee and sugar leading the way. Aside from export demand, sectors will benefit from a wave of consolidation and private investment in the case of poultry, coffee, and cocoa, as well as increased demand for alternative energies in the case of sugar.
- Soybean production growth to 2013/14: 39%. Improving yields and increasing global demand for alternative fuels (which use soybeans) will drive soybean production.
- Pork and poultry consumption growth: 14% and 21% respectively due to higher incomes among lower income groups despite the fact that domestic per capita meat consumption is already relatively high.
- Corn and sugar production growth: 45% and 33% respectively. These sectors will continue to heavily rely on export demand, although corn production will benefit from growth in the livestock sector, which uses it as feed.
- 2010 Real GDP Growth: 5.3 % (up from -0.2% in 2009; predicted to average 4.1% from now until 2014).
- Consumer Price Inflation: 5.2% y-o-y in April 2010 (down from 5.4% y-o-y in April 2009). Brazil will remain the world's leading producer of high grade arabica coffee, despite our forecast of 21% decline in production out to 2013/14. This decline is due to the bi-annual 'on year', 'off year' cycle, meaning production for the 2012/13 season will increase by 20% over the 2008/09 season. This growth will largely come from higher yields owing to increased private investment, as well as renewed access to Japan after a coffee import ban was recently lifted.
A wave of consolidation has hit the livestock sector, as producers looked for ways to save money in the wake of lower export demand in 2008/09. We expect more acquisitions in 2010 as companies drive to increase their economies of scale. The moves towards consolidation will place the increasingly large companies in a strong position as demand for meat improves with the world economy returning to health. The sugar sector should slowly return to health after producers suffered in the 2008/09 season from the credit crunch. We expect production to improve in 2009/10 as producers capitalised on soaring sugar prices in Q408 and Q409. Over the medium term, exports and domestic ethanol demand will be key growth drivers to sugar production.

Executive Summary ........................................................................................................................................ 6
SWOT Analysis ................................................................................................................................................ 8
Brazil Agricultural SWOT ..................................................................................................................................................................................... 8
Brazil Political SWOT ......................................................................................................................................................................................... 9
Brazil Economic SWOT ..................................................................................................................................................................................... 10
Brazil Business Environment SWOT .................................................................................................................................................................. 11
Industry Forecast Scenario ........................................................................................................................... 12
Brazil Livestock Outlook .......................................................................................................................................................................................... 12
Table: Brazil – Poultry Production, Consumption & Trade ............................................................................................................................... 13
Table: Brazil – Pork Production, Consumption & Trade.................................................................................................................................... 13
Table: Brazil – Beef & Veal Production, Consumption & Trade ......................................................................................................................... 13
Table: Brazil – Poultry Production, Consumption & Trade ............................................................................................................................... 18
Table: Brazil – Pork Production, Consumption & Trade.................................................................................................................................... 18
Table: Brazil – Beef & Veal Production, Consumption & Trade ......................................................................................................................... 18
Brazil Cocoa Outlook .............................................................................................................................................................................................. 20
Table: Brazil – Cocoa Production & Consumption ............................................................................................................................................ 20
Table: Brazil – Cocoa Production & Consumption ............................................................................................................................................ 21
Brazil Coffee Outlook .............................................................................................................................................................................................. 23
Table: Brazil – Coffee Production & Consumption ............................................................................................................................................ 24
Table: Brazil – Coffee Production & Consumption ............................................................................................................................................ 27
Brazil Sugar Outlook ............................................................................................................................................................................................... 28
Table: Brazil – Sugar Production, Consumption & Trade .................................................................................................................................. 29
Table: Brazil – Sugar Production, Consumption & Trade .................................................................................................................................. 32
Brazil Dairy Outlook ............................................................................................................................................................................................... 33
Table: Brazil – Milk Production & Consumption ............................................................................................................................................... 34
Table: Brazil – Butter Production, Consumption & Trade ................................................................................................................................. 34
Table: Brazil – Cheese Production, Consumption & Trade ................................................................................................................................ 34
Table: Brazil – Whole Milk Powder Production, Consumption & Trade ............................................................................................................ 34
Table: Brazil – Milk Production & Consumption ............................................................................................................................................... 37
Table: Brazil – Butter Production, Consumption & Trade ................................................................................................................................. 37
Table: Brazil – Cheese Production, Consumption & Trade ................................................................................................................................ 37
Table: Brazil – Whole Milk Powder Production, Consumption & Trade ............................................................................................................. 38
Brazil Rice Outlook .................................................................................................................................................................................................. 39
Table: Brazil – Rice Production, Consumption & Trade .................................................................................................................................... 40
Table: Brazil – Rice Production, Consumption & Trade .................................................................................................................................... 41
Brazil Grains Outlook .............................................................................................................................................................................................. 43
Table: Brazil – Wheat Production, Consumption & Trade ................................................................................................................................. 44
Table: Brazil – Corn Production, Consumption & Trade ................................................................................................................................... 44
Table: Brazil – Barley Production, Consumption & Trade ................................................................................................................................. 44
Table: Brazil – Wheat Production, Consumption & Trade ................................................................................................................................ 46
Table: Brazil – Corn Production, Consumption & Trade .................................................................................................................................. 46
Table: Brazil – Barley Production, Consumption & Trade ................................................................................................................................ 46
Brazil Soybean Outlook ........................................................................................................................................................................................... 48
Table: Brazil – Soybean Production, Consumption & Trade ............................................................................................................................... 49
Table: Brazil – Soybean Production, Consumption & Trade ............................................................................................................................... 51
Competitive Landscape ................................................................................................................................ 53
Table: Agricultural Commodity Producers & Traders ....................................................................................................................................... 53
Table: Agribusiness Suppliers ............................................................................................................................................................................ 54
Table: Integrated Agricultural Producers........................................................................................................................................................... 55
Commodity Price Analysis ............................................................................................................................ 56
Grains Update ......................................................................................................................................................................................................... 56
Corn .................................................................................................................................................................................................................... 56
Table: Corn ........................................................................................................................................................................................................ 56
Rice ..................................................................................................................................................................................................................... 57
Table: Rice .......................................................................................................................................................................................................... 57
Soy ...................................................................................................................................................................................................................... 58
Table: Soybean ................................................................................................................................................................................................... 58
Wheat .................................................................................................................................................................................................................. 59
Table: Wheat....................................................................................................................................................................................................... 59
Softs Update ............................................................................................................................................................................................................. 60
Cocoa.................................................................................................................................................................................................................. 60
Table: Cocoa ...................................................................................................................................................................................................... 60
Coffee.................................................................................................................................................................................................................. 61
Table: Coffee ...................................................................................................................................................................................................... 61
Milk ..................................................................................................................................................................................................................... 62
Table: Milk ......................................................................................................................................................................................................... 62
Sugar .................................................................................................................................................................................................................. 63
Table: Sugar ....................................................................................................................................................................................................... 63
Downstream Supply Chain Analysis ............................................................................................................ 64
Industry Forecast Scenario ...................................................................................................................................................................................... 64
Consumer Outlook .............................................................................................................................................................................................. 64
Food ................................................................................................................................................................................................................... 66
Total Food Consumption .................................................................................................................................................................................... 66
Table: Brazil Food Consumption Indicators -- Historical Data & Forecasts ...................................................................................................... 66
Canned Food ...................................................................................................................................................................................................... 67
Table: Canned Food Value/Volume Sales -- Historical Data & Forecasts .......................................................................................................... 67
Confectionery...................................................................................................................................................................................................... 67
Table: Confectionery Value/Volume Sales -- Historical Data & Forecasts ......................................................................................................... 68
Mass Grocery Retail ........................................................................................................................................................................................... 69
Table: Mass Grocery Retail -- Value Sales by Format -- Historical Data & Forecasts ....................................................................................... 70
Table: Sales Breakdown By Retail Format (%) .................................................................................................................................................. 70
Trade .................................................................................................................................................................................................................. 71
Table: Food & Drink Trade Balance - Historical Data & Forecasts .................................................................................................................. 71
Economic Outlook.................................................................................................................................................................................................... 72
Table: Brazil - Economic Activity, 2007-2014 .................................................................................................................................................... 76
BMI Forecast Modelling ................................................................................................................................ 77
How We Generate Our Industry Forecasts .............................................................................................................................................................. 77

Brazil Agribusiness Report Q3 2010

Published By: Business Monitor International
 

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