China remains top destination for Brazilian agribusiness exports in 2024

Despite a year marked by weather challenges that threatened grain, coffee, and sugarcane crops, Brazilian agribusiness exports remained strong in 2024. 

Revenue reached US$165.13 billion, a slight 1.2% decrease from 2023, still marking the second-highest export revenue in the sector's history, according to Datagro Consulting's analysis of data from the Foreign Trade Secretary (Secex) of the Ministry of Development, Industry, Trade and Services (MDIC). This amount represented 49.0% of Brazil's total exports during the period.

China maintained its position as the primary destination for Brazilian agribusiness products in 2024. Sales to the Chinese market totaled $49.7 billion, a 17.5% decrease from 2023, or $10.54 billion less. Consequently, China's share dropped from 36.2% in 2023 to 30.2% in 2024. Soybeans remained the main export to China, with sales of $31.5 billion (an annual decrease of $7.4 billion) — China purchased 73.4% of Brazil's total soybean exports, 2.6% less than the previous year.

The United States was the second-largest destination for Brazilian agribusiness, with shipments worth $12.1 billion (+23.1%). The U.S. share of Brazilian agribusiness exports increased from 5.9% to 7.4% in one year. The main products exported to the United States were green coffee, cellulose, fresh beef, and orange juice.

The increase in Brazilian agribusiness exports in 2024 resulted from proportionally higher prices—the Quantum Index of Brazilian agribusiness exports fell 1.2%, while the Price Index of exported products grew 2.9% on average in 2024, according to Datagro calculations.

Among major agribusiness items, cotton exports showed the highest revenue growth in 2024, reaching $5.41 billion, 62.4% above 2023. This reflected a 16% increase in production during the 23/24 harvest due to improved productivity and sector promotion abroad (notably, Brazil surpassed the U.S. as the world's leading cotton exporter).

Coffee exports followed, growing 52.9% to a record $12.27 billion in 2024, despite container availability issues that led many producers to resort to break-bulk vessels. Categories including juices (+30.9%), paper and cellulose (+27.0%), sugar (+18.1%), and meats (11.4%) also stood out in the list of increased agribusiness exports last year.

Conversely, soybean oil export revenue fell 47.8% in 2024, followed by corn (-40.2%), soybeans (-12.5%), and soybean meal (-15.7%). The soy complex exports were affected by a 5% reduction in grain production in the 2023-2024 harvest due to productivity losses, increased competition from Argentine products in foreign markets, and stronger domestic demand, especially for soybean oil in the biodiesel industry.

Corn exports were also influenced by decreased production in the 2023-2024 harvest, both due to area reduction and agricultural productivity and equally strong domestic market demand, particularly from the corn ethanol industry. Not surprisingly, due to lower exportable surplus, corn export volume fell 28.8% in 2024 to 39.76 million tons, although accompanied by an 18.9% increase in average FOB price.

On the import side, agribusiness sector imports, including fertilizers and pesticides, grew 5.5% in 2024 to $41.70 billion CIF, mainly due to increased import volume of KCL and nitrogen fertilizers. Nevertheless, agribusiness imports' share of total Brazilian imports fell to 15.0% in 2024, compared to 15.6% in 2023 and 18.9% in 2022, marking the lowest rate in seven years.

Consequently, the Brazilian agribusiness trade balance, the difference between exports (FOB value) and imports (CIF value), fell only 3.3% in 2024 to $123.43 billion. Without the positive agribusiness trade balance, Brazil's total trade balance would have incurred a deficit of around $64 billion instead of a $59.50 billion surplus in 2024.

However, since it avoided gasoline imports due to domestic ethanol consumption (in gasoline equivalent), the agribusiness trade balance was 12.4% higher in 2024, at $138.77 billion, preventing Brazil's trade balance from showing an implicit deficit of $79.28 billion.

Notably, ethanol consumption (anhydrous plus hydrous) in Brazil hit a record 26.92 billion liters in gasoline equivalent in 2024, a 14.0% increase in one year. This means the gasoline import expenditure due to domestic ethanol consumption also hit a record $15.36 billion (CIF value) in 2024, 10.7% more than in 2023.

The year 2025 holds more significant opportunities for Brazilian agribusiness exports, starting with the dollar's appreciation against the Real. Donald Trump's election in the U.S. rekindled prospects of trade tensions, given the new president's plans to tax imports, especially Chinese products. Moreover, on the supply side, there are expectations of a grain harvest recovery and likely greater sugarcane supply due to good weather conditions since last October.

It is worth noting the likelihood of more significant opportunities for Brazilian grain exports as possible trade tensions between the U.S. and China may increase Beijing's purchases of Brazilian soybeans and corn over American products. However, despite the preference for Brazilian grain given the trade war scenario with the U.S., expectations of a Chinese economic slowdown urge caution regarding agribusiness export performance in 2025.

Additionally, after recording records, there are concerns about the exportable coffee surplus in 2025 due to drought and fire impacts on coffee plantations in 2024, while the orange juice sector faces another challenging year with aging orchards and increased disease spread, such as greening.

LOGISTICS

In logistics, the sector has invested in port expansion and modernization, such as infrastructure investments in the Port of Santana in northern Brazil. These investments will strengthen the Northern Arc as a strategic hub for grain flow.

Another example of logistical innovation, albeit long-term, is the Port of Chancay in Peru, receiving significant investments to enable a more agile route compared to traditional Atlantic ports. Although logistical challenges remain in Peru, such as the 800-kilometer Andes route, infrastructure investment combined with reduced navigation time represents a promising opportunity for producers in Brazil's North and Central-West regions.

Despite investments in alternative routes, Port of Santos has also received funding to improve agribusiness product flow. Last November saw the inauguration of the T-32 terminal and completion of DP World Brasil's (DPW) second phase, structures responsible for handling cellulose and paper cargo.

Meanwhile, Cofco invested in a Port of Santos terminal capable of handling 14 million tons of grain annually. The terminal's inauguration is scheduled for 2025 and should quadruple Cofco's port capacity in Brazil, allowing up to 200 ships annually. With direct railway connections, the new terminal promises to reduce logistical costs and optimize the flow of soybeans, corn, and sugar, Brazil's main exports to China.

(Editing by Leonardo Gottems, reporter for AgroPages)