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In A World Of Unprecedented Uncertainties, The Idea That Nations Depend On Brazil For Their Food Is A Dangerous Myth. Risk Management And The Focus On Added Value Are Crucial.
The Brazilian agribusiness operates under the belief that the world needs its products to feed itself, but this is an illusion. In reality, countries seek self-sufficiency and food security, avoiding dependence on imported food. Navigating this new chaotic global scenario requires Brazil’s agro to abandon old myths and adopt rigorous risk management.
The Illusion Of Global Dependence On Brazil’s Agro
There is a widespread idea that the world needs Brazil to secure its food, but this is not true. According to Marcos Jank of the Insper Global Agribusiness Center, countries do not want to depend on food that comes from abroad. Food security is a critical issue, especially for nations with over a billion inhabitants. The priority is always domestic production.
This mistaken perception can lead to fragile strategies. Thinking that Brazil is the planet’s only food solution is a mistake that can be costly.
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Saudi Arabia bought nearly 397,000 tons of Brazilian chicken, but now wants to create a poultry empire in the desert: the self-sufficiency plan targets local production, threatens shipments from BRF, JBS, and Seara, and raises an alert for Brazil in the halal market until 2030.
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War in Iran raises fertilizer prices, triggers alert in Brazilian agribusiness, and leads the government to seek new suppliers to avoid impacts on the harvest.
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Soybeans plummet in Chicago with favorable weather in the United States, and Brazilian producers hold off sales due to price pressure and lack of market response.
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Raising tilapia, the most farmed fish in Brazil, with solar-powered tanks is a trend gaining strength in the field because the panels ensure water oxygenation in places without electricity and reduce costs, although profitability depends on management, feed, and market.
The New Compass For The Rural Producer
The current scenario is described as a “chaotic multipolar world.” The main message for the rural producer is clear: risk management has never been as fundamental as it is today. We are living in a period of unprecedented uncertainties, influenced by the strong hegemonic dispute between the United States and China.
This new global disorder directly affects markets, prices, and logistics. Therefore, the producer from Brazil’s agro needs to be prepared for volatilities and abrupt changes, protecting their production and business in a strategic manner.
The Real Size Of Brazil’s Agro In The Global Scenario
It is common to hear that Brazil is “the largest in the world” in agribusiness, but this statement needs context. The country is neither the largest global producer nor the largest consumer. Considering the European Union as a bloc, Brazil is the third-largest exporter, behind Europe and the United States.
The true Brazilian leadership lies in the export of agricultural commodities. In this specific area, the country is indeed number one. However, when it comes to value-added products, Brazil has still not done its homework and falls behind its main competitors.
The Asia Factor And Demographic Pressure On Consumption
A force driving global demand is the shift in consumption patterns in Asia. The continent’s population is becoming predominantly urban. As people migrate from the countryside to cities, they leave subsistence farming and start buying food, seeking a better and more varied diet.
Moreover, the planet is facing significant demographic pressure, with a positive balance of 70 million people per year. This continuous growth of the global population increases the need for food and represents an opportunity for Brazil’s agro, as long as the sector knows how to position itself.
Negotiations That Threaten Brazil’s Agro
The real concern for Brazilian agribusiness is not just direct tariffs. What worries more, according to Jank, are the negotiations the United States is conducting with countries that are markets of great interest to Brazil.
While a specific tariff may have a limited impact, competitors’ trade agreements can redefine access to entire markets. It is in this geopolitical field that Brazil’s agro faces its greatest challenges, where competitors’ actions pose a bigger risk than direct tariff issues.
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