By Daniele Siqueira, AgRural
My plan for this week was to write something not related to the coronavirus pandemic, since many of us already seem to be sick of so much information (and, unfortunately, misinformation disguised as clickbait headlines) about the disease and the measures that have been taken around the world to control its spread. But things have escalated fast here in Brazil over the last few days and it is impossible to keep going as if everything was normal. Right now, nothing is normal.
Although many Brazilian farmers have been selling soybeans at record prices, thanks to our weakening currency (a direct result of the risk aversion caused by the pandemic), some of them are not exactly in a bed of roses. In central and northeastern states, there are farmers who have debts in US dollars, due to the type of credit they use, and those debts have skyrocketed in just a few weeks.
That situation is likely to impact their cash flow, their access to credit and, ultimately, the size of the planted area later this year, among other problems. But let’s think about that later, along with the economic disaster that we have ahead of us, a fragile economy which was just starting to recover from a very long and serious crisis. Right now, there are more urgent problems.
No disruptions yet
So far, Brazil has been able to keep exporting soybeans and other goods without significant disruptions caused by the pandemic. Since February, however, we have had a vessel jam in our ports that might get worse over the coming weeks, depending on how quarantine and lockdowns will affect not only loading activities at the ports, but also the transportation from producing regions to the ports.
The Ministry of Infrastructure took measures last week to avoid disruptions, working together with Brazilian states to detail and harmonize proceedings at ports, ensure the safety of workers and keep the flow of goods across the country. Brazil is a federal republic and our 26 states have the autonomy to close their borders, for example, which is troublesome in times like this, when nobody is completely sure about what is the best thing to do – thus the importance that the federal government issues clear guidelines.
The problem is that port workers are afraid of the disease, like almost everybody else, and strikes are very likely and even understandable. The timing couldn’t be worse, because Brazil is approaching the peak of its soybean export season (which normally happens in April and May) and because China needs soybeans right now to avoid a soymeal shortage.
Not by chance, the Chinese purchased US soybeans last week after a long hiatus, on the same day that workers were deliberating about a strike in Santos, Brazil’s largest port. Brazil is harvesting its best soybean crop ever, but will have to prove to the world, once again, that it has the capacity to ship those soybeans to whoever needs them.
Harvest reaches 66% of area
Speaking of harvest, 66% of Brazil’s soybean area had been harvested by Mar 19, according to AgRural, compared to 67% a year earlier. That means that the delay we have seen in the 2019/20 crop is no longer a problem. At least that.
Most of the country is now shutdown, but farmers and rural workers keep working and proving, more than ever, how important they are. While some opportunistic environmentalists use their social media, from the comfort of their home offices, to celebrate how clean the planet is now (at what a price, right?!), food producers are at the frontline, harvesting the 2019/20 crop in South America and starting to plant the 2020/21 crop in the US, to keep us all fed and strong during these times of trouble.