Record production and high prices encourage investments in the sector
An estimate from the National Agricultural Confederation (Confederação Nacional de Agricultura – CNA) foresees 9% growth in the Agribusiness GDP this year, when compared to 2020, and also 17.4% of the Gross Production Value (GPV), exceeding BRL 903 billion. The soybean harvest, Brazil’s main commodity, has taken a hit with the excessive rain in some regions, which has delayed harvesting in several stated. However, the expectation of exceeding the 132 million tons harvested is confirmed. The Brazilian meat is also going through a good moment, with an increase in price which shall remain throughout the year, as a result of the restricted offer of cattle in the country and a strong demand from China, the greatest importer of meat from Brazil at the moment. In the planted forest sector, the expectations are promising, with forecast growth in the activity. The crop and production sector foresees that 2021 will bring a boost in exports, based on the performance of the second half of 2020, with an excellent result, despite the COVID-29 pandemic affecting the sector in the first half of the year.
In the region of São Jerônimo da Serra, in the north of Paraná, which gathers those three agribusiness economic activities, the results up to the moment confirm the expectations. The Paraná Wood Group (GPW) – a business ecosystem focusing on agribusiness with the gathering of the companies Paraná Wood Florestal, Paraná Wood Indústria Madeireira, Paraná Wood Agrícola and Paraná Wood Pecuária – is quite successful in its activities.
Paraná Wood Agrícola’s expectation, with the beginning of the soybean harvest, is to have a record production of soybean seed. “It was a wonderful season, and we expect 20% growth in relation to the former harvest”, declares the owner of GPW, the physician and businessman João Luiz Garcia de Faria. According to him, until the end of the harvest, the expectation is to harvest on average 64 to 66 bags per hectare. This is well above the Brazilian average, which in the 2019/2020 harvest remained at approximately 60 bags per hectare, according to the National Food Supply Company (Companhia Nacional de Abastecimento – Conab). For the businessman, the high price will remain or even increase a little, if “China’s appetite” is maintained. “The same can be said for the price of meat, with China buying a lot”, he assesses.
According to Faria, timber was the last of the commodities to react in price. “However, with the acceleration of the industrial production in the second half, more pallets were required, as well as more packaging, and that made the prices rise. In the past three months, we had almost 35% increase”, he states. According to him, the exports were essential, since the European market also started to absorb eucalyptus timber, which was not much used in the area. “Europeans preferred pinus, but this is already shifting, and they have an eye in the Brazilian production”, he declares.
GPW’s idea is to invest a great part of its revenue in businesses that are already consolidated, increasing production areas and continuing to make investments, such as the acquisition of new equipment. “We are also open to partnerships with investors, mainly in the forest area. We are focused on the transformation of this region, and we are already harvesting results. Anyone who wants to start from scratch needs expertise and land, both with a very high cost. We estimate that agribusiness will remain at this level of results for the next 10 years, better than in the financial market. And that is why we propose partnerships”, he explains.
The Paraná Wood Group is investing in Paraná, growing partnerships, willing to expand its operation, and also innovate in agribusiness.