According to the National Institute of Meteorology (Inmet), the forecast for summer 2024 is for above-average temperatures throughout Brazil, with emphasis on the North, Northeast and Central-West regions. Rainfall is also expected to be above average in the North and Northeast, but below average in the Central-West and Southeast.
These climatic conditions may have significant implications for some sectors of the Brazilian economy, such as:
Construction
Civil construction is also an important sector of the Brazilian economy and is currently awaiting a scenario of falling interest rates and financing supply, which would trigger a boom in the sector that is already in full recovery in this post-pandemic period. Adverse weather can affect the productivity of works, increasing costs and execution time, especially in the phase of preparing the land and implementing the foundations of houses and especially buildings.
In summer, the strong sun and intense heat can make it difficult for workers to work, reducing productivity and increasing the risk of accidents. Rain can also cause delays in works, due to the need for drainage and repairs.
Turismo
Tourism is an important sector of the Brazilian economy, and the climate is a determining factor in the sector’s performance. In summer, the warm and pleasant climate is ideal for tourism, but bad weather can cause damage to the sector.
Rains can cause cancellation of reservations in hotels and inns, which results in a reduction in passengers on flights, in the volume of cars traveling and in the vehicle rental segment and contracting of transport services for tourists. Dry periods also end up driving away tourists from the affected regions.
Commerce, tourism and investments
The climate can also affect the economy in general, making access to commerce and external activities difficult. In summer, bad weather can reduce the flow of customers in street stores, causing a drop in sales.
Outdoor activities, such as sporting events and concerts, can also be affected by inclement weather, causing cancellations or reduced attendance.
Extreme weather events also have the potential to consume public budgets and resources in an emergency, causing a contingency of funds previously destined for investments and which are now directed to minimize the scourge of people affected by droughts, windstorms and/or floods.
Agribusiness
Without a doubt, the agribusiness segment is the most sensitive to climate instability, as in summer the excess sun reduces soil moisture, which can lead to drought with the potential to harm plant development and consequently reduce productivity, while rain in excess they can cause floods and landslides, destroying crops and infrastructure.
Agribusiness is one of the most important sectors of the Brazilian economy, contributing in a stable and substantial way to the Brazilian GDP. Climate is a determining factor for agricultural productivity, and adverse weather conditions can cause significant losses that quickly impact various segments of the economy linked to agribusiness.
Significant anomalies in the climate, in the first analysis, lead to an increase in food prices, a condition that breaks the fragile bonds of inflation, the “Pandora’s box” from which unpredictable results can result not only in the economy, but also with direct implications in the political sphere.
Summary of expectations for food harvests in Brazil in 2024
The prospects for crops of essential foods for human and animal consumption in Brazil in 2024 are, in general, positive. The expectation is for a record grain harvest, with production estimated at 288.4 million tons, an increase of 3.2% compared to 2023.
The main agricultural products that are expected to show growth in production in 2024 are:
- Corn: production is expected to grow 5.3%, to 112.9 million tons.
- Rice: production is expected to grow 1.5%, to 112.2 million tons.
- Military: production is expected to grow 3.2%, to 140.5 million tons.
These positive outlooks are driven by a number of factors, including:
Favorable climatic conditions: climate forecasts for 2024 indicate that climate conditions will be, in general, favorable for agriculture.
Investments in technology: Investments in agricultural technology are increasing, which is leading to productivity gains.
Increased demand: demand for food is increasing, driven by population growth and rising incomes.
However, it is important to highlight that the climate is still an unpredictable factor, and adverse conditions can cause damage to agricultural production. Additionally, rising production costs, such as fertilizers and fuel, could put pressure on food prices.
Impact of the 2024 grain harvest
The grain harvest in 2024 should reach a result close to or even slightly higher than 2023, providing a positive impact on the Brazilian economy, contributing to an increase in agricultural production, rural producer income and food supply on the domestic market.
The expectation of an increase in agricultural production should generate jobs and income in the countryside, contributing to the economic development of producing regions. Furthermore, the increase in the availability of food at retail should contribute to reducing its prices, benefiting the mass of consumers.