Corn may lead Brazil to next export boom, analysts say

“If Chinese purchases of iron ore caused the original export boom in Brazil, the new export boom will center around agricultural exports [corn]. The economic impact that will follow will depend on the terms of trade, which are currently very favorable to Brazil,” says analyst Tom Miller in a report by Gavekal Research released on the 20th.

Miller points out that the interruption of Ukrainian corn production has become an excellent opportunity for Brazilian agribusiness. Not by chance, since the beginning of the year, China and Brazil have been working to make it possible to import the grain produced here to supply the growing swine industry in the Asian country.

The Russian invasion of Ukraine created space in the international market to meet a demand of around 30 million tonnes of corn per year. Brazil is one of the leading candidates to absorb this market share, which cost China around US$ 10 billion last year.

Miller claims that with the predicted decline in demand for iron ore due to the slowdown in China’s real estate sector, the Chinese appetite for Brazilian supplies should ease international accounts.

Agribusiness should, once again, stand as one of the main economic pillars of Brazil in the coming years. “If global prices remain high, Brazilian farmers will be able to help the next government a lot,” assesses the analyst.

Source: O Antagonista

To read the full original article, please go to: https://oantagonista.uol.com.br/economia/milho-deve-ser-o-responsavel-pelo-proximo-boom-exportador-no-brasil/

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