PRISMA WEEKLY MARKET REPORT #46 – UNITED STATES AND BRAZIL: FRIENDS OR FOES? PART 3/3

Despite all the trends stated on previous reports about the decline of the United States’ influence over Brazil, the sheer amount of pop culture, consumer habits and day to day behavior patterns derived from this single North American powerhouse towards Brazil is still unparalleled. Much of the technology built on the agribusiness would be impossible without the advancements that mainly start off in the United States and are later brought on across the continent. Even if Brazil does not immediately benefit from this, the tropical country remains close enough with the United States to be able to perceive changes and seize the opportunities accordingly, such are the advantages on having a neighbor as powerful as the United States.

In one hand, Brazil surely is a direct competitor of the United States in the agribusiness sector, yet, the exports of agricultural goods are not as key in the United States as they are for Brazil. In this fashion, while Brazil does compete with the North American country, there is still another face in this trade, that is the case for the machinery used in all the main agribusiness production sites in Brazil, from the farmland to the slaughterhouses, much of the productivity increase has come over the years with the addition of machines developed mainly in the United States. Adding everything up, there surely are great benefits in aligning with the United States.

Coming back on the topic of agricultural exports, the United States focuses much more in providing for its domestic market, as it can be seen on the latest report from the Brazilian Association on the Meat Exporting Industries (ABIEC), the United States is the world’s top beef meat consumer, at 12.535 thousand tons solely in 2020, going above any other country. In fact, Argentina does have a higher kg/per capita consumption of beef at 51,16kg/per capita in 2020, but overall numbers still bring the United States to the first place, even though China has been stepping up beef consumption over the last couple of years, the Asian potency will need more time, if the current trend continues, to surpass the United States domestic market appetite for beef.Despite all the trends stated on previous reports about the decline of the United States’ influence over Brazil, the sheer amount of pop culture, consumer habits and day to day behavior patterns derived from this single North American powerhouse towards Brazil is still unparalleled. Much of the technology built on the agribusiness would be impossible without the advancements that mainly start off in the United States and are later brought on across the continent. Even if Brazil does not immediately benefit from this, the tropical country remains close enough with the United States to be able to perceive changes and seize the opportunities accordingly, such are the advantages on having a neighbor as powerful as the United States.

In one hand, Brazil surely is a direct competitor of the United States in the agribusiness sector, yet, the exports of agricultural goods are not as key in the United States as they are for Brazil. In this fashion, while Brazil does compete with the North American country, there is still another face in this trade, that is the case for the machinery used in all the main agribusiness production sites in Brazil, from the farmland to the slaughterhouses, much of the productivity increase has come over the years with the addition of machines developed mainly in the United States. Adding everything up, there surely are great benefits in aligning with the United States.

Coming back on the topic of agricultural exports, the United States focuses much more in providing for its domestic market, as it can be seen on the latest report from the Brazilian Association on the Meat Exporting Industries (ABIEC), the United States is the world’s top beef meat consumer, at 12.535 thousand tons solely in 2020, going above any other country. In fact, Argentina does have a higher kg/per capita consumption of beef at 51,16kg/per capita in 2020, but overall numbers still bring the United States to the first place, even though China has been stepping up beef consumption over the last couple of years, the Asian potency will need more time, if the current trend continues, to surpass the United States domestic market appetite for beef.

That is not to say that the Brazilian domestic market stays behind, with over 7.545 thousand tons consumed annually, Brazil comes second as the world’s top beef consumer. Yet, compared to the United States, which also imports beef from overseas to completely fulfil its domestic market needs, Brazil leaves around 25% of its annual production to be exported. As latest data from ABIEC and the United States Department of Agriculture (USDA) show, of the 10.100 thousand tons produced in 2020, Brazil exported over 2.539 thousand tons. Much different from the United States take, producing around 12.379 thousand tons and exporting 1.341 thousand tons, a little over 10%.

It is also worth noting that according to the USDA, the United States has consumed 12.519 thousand tons of beef and veal meat, which is above the quantity produced nationally.?

Since the exports are not the focus for the United States beef, it would be expected a worse performance for their exports, but this is not the case. Looking at the most recent Beef Report from ABIEC, the United States sits in third place as one of the world’s biggest beef exporter, only standing behind Brazil (2.690 thousand tons in 2020) and Australia (1.391 thousand tons in 2020). Yet again, it is interesting to point out the different strategies and market demands from each country, where Australia exports more than 65% of their national production, United States and Brazil which have way more robust domestic markets, tend to preserve much of what is produced internally.?

Suffice to say, Brazil and United States have a very similar profile for the beef industry, although the weight carried by each is very different. The beef industry in Brazil is one of the core pillars of the Brazilian strength in agribusiness exports, on the other hand, the United States beef exports are only a complementary market to the country and do not account for as much.

Once again, both countries remain competitors in the international scenery, fighting over prices, shares in each market and opportunities yet unexplored by the other part. At the same time, Brazil is nurtured by much of the technology provided first handedly from its neighbor, benefiting the Brazilian productivity and quality of production in many sectors including the agribusiness; this goes both ways, as the United States is paid back and reverts the profits in growing its own country. There is space for Brazil and United States to help one another, there is also room for contention in many aspects, and much of this will depend on the context in which they are inserted; as always, nothing is set in stone. At the very least, now it is way more clear where are the gains and possible losses.

*All opinions expressed in this report solely reflect the current view by Prisma International and may or may not render to be true on the upcoming months.

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PRISMA - RELATóRIO SEMANAL #46 – ESTADOS UNIDOS E BRASIL: PARCEIROS OU RIVAIS? PARTE 3/3

Apesar de todas as tendências estabelecidas em relatórios anteriores sobre o declínio da influência dos Estados Unidos sobre o Brasil, a grande quantidade de cultura pop, hábitos de consumo e padr?es de comportamento do dia a dia derivados desta única potência norte-americana em rela??o ao Brasil ainda n?o possui paralelos. Grande parte da tecnologia advinda do agronegócio seria impossível sem os avan?os que come?am principalmente nos Estados Unidos e posteriormente atravessam o continente. Mesmo que o Brasil n?o se beneficie imediatamente com isso, o país tropical continua próximo o suficiente dos Estados Unidos para poder perceber as mudan?as e aproveitar as oportunidades de maneira rápida, essas s?o as vantagens de ter um vizinho t?o poderoso como os Estados Unidos.

Por um lado, o Brasil certamente é um concorrente direto dos Estados Unidos no agronegócio, mas as exporta??es de produtos agrícolas n?o s?o t?o importantes nos Estados Unidos quanto s?o para o Brasil. Dessa forma, enquanto o Brasil concorre com o país norte-americano, há ainda outra face nesse comércio, é o caso das máquinas utilizadas em todos os principais locais de produ??o do agronegócio brasileiro, desde as fazendas até os frigoríficos, boa parte do aumento da produtividade que veio ao longo dos anos é devido à adi??o de máquinas desenvolvidas principalmente nos Estados Unidos. Em suma, certamente há grandes benefícios em se alinhar com os Estados Unidos.

Voltando ao tema das exporta??es agrícolas, os Estados Unidos se concentram muito mais no abastecimento do seu mercado interno, como pode ser verificado no último relatório da Associa??o Brasileira das Indústrias Exportadoras de Carne (ABIEC), os Estados Unidos s?o o maior consumidor de carne bovina do mundo, com 12.535 mil toneladas somente em 2020, superando qualquer outro país. Ainda que a Argentina possua um consumo maior de kg/per capita de carne bovina, este de 51,16 kg/per capita em 2020; ainda, os números gerais colocam os Estados Unidos em primeiro lugar, embora a China tenha aumentado o consumo de carne bovina nos últimos anos, a potência asiática precisará de mais tempo, se a tendência atual continuar, para superar o apetite do mercado interno dos Estados Unidos por carne bovina.

Isso n?o quer dizer que o mercado interno brasileiro fique para trás, com mais de 7.545 mil toneladas consumidas anualmente, o Brasil vem em segundo lugar como maior consumidor mundial de carne bovina. Ainda assim, em compara??o com os Estados Unidos, que também importa carne bovina do exterior para atender integralmente às necessidades do mercado interno, o Brasil deixa cerca de 25% de sua produ??o anual para exporta??o. Conforme mostram os últimos dados da ABIEC e do Departamento de Agricultura dos Estados Unidos (USDA), das 10,1 mil toneladas produzidas em 2020, o Brasil exportou mais de 2,539 mil toneladas. Diferente do panorama nos Estados Unidos, produzindo em torno de 12.379 mil toneladas e exportando 1.341 mil toneladas, pouco menos de 10% exportados.

Vale ressaltar também que, de acordo com o USDA, os Estados Unidos consumiram 12.519 mil toneladas de carne bovina, superior à produ??o nacional.

Como as exporta??es n?o s?o o foco da carne bovina dos Estados Unidos, seria de se esperar um desempenho pior para suas exporta??es, mas n?o é o caso. Olhando o mais recente Beef Report da ABIEC, os Estados Unidos est?o em terceiro lugar como um dos maiores exportadores de carne bovina do mundo, atrás apenas do Brasil (2.690 mil toneladas em 2020) e da Austrália (1.391 mil toneladas em 2020). Mais uma vez, é interessante apontar as diferentes estratégias e demandas de mercado de cada país, onde a Austrália exporta mais de 65% de sua produ??o nacional, Estados Unidos e Brasil que possuem mercados internos bem mais robustos, tendem a preservar muito do que é produzido internamente.

Basta dizer que Brasil e Estados Unidos têm um perfil muito semelhante para a indústria de carne bovina, embora o peso dado a cada um seja muito diferente. A indústria da carne bovina no Brasil é um dos pilares da for?a brasileira nas exporta??es do agronegócio, por outro lado, as exporta??es de carne bovina dos Estados Unidos s?o apenas um mercado complementar ao país e n?o respondem por tanto.

De certo, os dois países continuam competidores no cenário internacional, brigando por pre?os, participa??es em cada mercado e oportunidades ainda inexploradas pela outra parte. Ao mesmo tempo, o Brasil é alimentado por grande parte da tecnologia fornecida em primeira m?o de seu vizinho, beneficiando a produtividade brasileira e a qualidade da produ??o em muitos setores, incluindo o agronegócio; isso vale para os dois lados, já que os Estados Unidos s?o pagos e revertem os lucros para o investimento em seu próprio país. Há espa?o para que Brasil e Estados Unidos se ajudem, também há espa?o para contendas em muitos aspectos, e muito disso vai depender do contexto em que est?o inseridos; como sempre, nada é completamente certo. No entanto, agora sabem-se onde est?o os ganhos e as possíveis perdas.

?*Toda opini?o expressa neste informe reflete somente a vis?o atual da Prisma International e pode ou n?o vir a tornar-se realidade nos meses vindouros.