In this week’s edition…
All eyes on Lavoro
Jacto does Connectivity
Silos as a Service
Collaborative Ag
On-farm Bio deadline
Bumper grain crop
Coffee Bees
Dollar gains
Cowgirls
The Big Three
Biofuel accelerates
New Cocoa hub
Sustainable plans
Startup News
Riding out the storm…
Lavoro, one of Brazil's leading agricultural input distributors, remains under close watch following the recent Chapter 11 filing of its main competitor, Agrogalaxy. Last week, Lavoro reported a $150 million net loss for the 2023/24 season—a 250% increase year-over-year—citing low margins, high farmer default rates, low commodity prices, high interest rates, and adverse weather. Despite liquidity challenges and limited credit access, Lavoro remains optimistic about margin recovery in 2024/25.
Connecting the dots…
Jacto, Brazil’s leading agricultural machinery manufacturer, has ventured into the connectivity market by offering private 4G networks for rural areas in partnership with Virtueyes. The project officially launches in February 2025, aiming to install 100 antennas covering 5,000 hectares each to boost digital agriculture adoption.
Silos as a service…
Kepler Weber, a leading grain storage company approaching its 100th anniversary, is entering a new phase by offering silo rentals and using data analytics to optimize logistics. This service fills a critical gap with record grain crops expected next year, as currently only 30% of Brazilian farms have storage facilities, compared to 60% in the U.S.
Collaborative Ag…
A PwC report shows that 82% of Brazil's large agricultural companies and cooperatives are part of at least one innovation hub, and 76% practice open innovation. The report highlights a shift towards collaboration and technology adoption within the sector, which is good news for startups.
Tick-Tock for on-farm bio…
Brazil’s farm lobby group, FPA, is pushing for urgent approval of new biological input legislation to prevent on-farm bio-production becoming illegal from January 2025. The FPA argues that regulatory support for bio inputs is essential for sustainable and low-carbon farming, and in particular the safe and regulated use of on-farm biologicals.
Growing grains…
Brazil's grain production is projected to increase by 27% over the next decade, reaching 379 million metric tons by 2033/34, with primary growth in soybeans, corn, and wheat. The expansion will be supported by a 15.5% increase in planted area, totaling 92.2 million hectares. The study also forecasts a 22.1% growth in meat production, in particular poultry and pork.
Sting in your coffee…
A study by Embrapa suggests that managed bee colonies on coffee farms could boost Brazil’s arabica coffee revenue by up to $4 billion annually. Assisted pollination improves productivity and quality, while the São Paulo government has pledged $100 million to strengthen the coffee sector through public-private partnerships.
Dollar gains and pains…
Brazil's currency depreciated last week amid fiscal concerns and pre-U.S. election position adjustments, pushing the dollar to R$5.87, near its all-time high. A strong dollar benefits Brazilian exports but raises input costs, affecting fertilizer and chemicals.
Cowgirls…
A recent Higher Education Census shows that women now make up 52.4% of agricultural students in Brazil, with leading agribusiness school Atitus having 67% female enrollment in Agronomy and Veterinary courses. This trend highlights the increasing presence of women in Brazil’s agribusiness sector and underscores the sector's appeal, in contrast to trends seen in more developed countries.
Ag Trinity…
Forbes Agro100 reports that JBS, Marfrig, and Cargill—Brazil's top three agribusiness companies—each generate over $20 billion in revenue, with a combined total of $500 billion. JBS and Marfrig have benefited from high beef prices this year, while Cargill excels in grains and animal nutrition.
Biofuel Boom…
Itaú Bank forecasts a $4 billion boost in Brazil’s agricultural sector by 2025, driven by surging biofuel production. At a recent event, the bank emphasized renewable energy's role in shaping the future of agribusiness, highlighting that this segment is expected to grow rapidly and attract foreign investment. The focus on biofuels is viewed as a critical strategy to meet the rising demand for sustainable agricultural solutions.
Hot Chocolate…
Brazil’s northeastern state of Tocantins is positioning itself as a new center for cocoa cultivation, thanks to its hot climate and suitable soil conditions. Experts believe that introducing cocoa to this region could diversify agricultural output and support local economic growth, meeting the increasing demand for high-quality cocoa and promoting sustainability in Brazilian agriculture.
Native lands…
Brazil has unveiled an ambitious plan (Planaveg) to restore 12 million hectares of land by 2030, as part of its commitment to biodiversity and environmental sustainability. Announced at COP16 in Cali, Colombia, this initiative aligns with the global "30x30" target to restore 30% of land and water areas by the decade’s end. The plan aims to enhance ecosystems, boost carbon capture, and support local communities through sustainable practices.
Startup News
Hedging locally…
Brazilian startup Balcão Agrícola do Brasil (BAB) is launching a new over-the-counter derivatives platform to simplify and localize hedging for soybeans and corn. With quotes in Brazilian reais and focusing on physical settlement in key grain-producing regions, this platform addresses the "basis risk" between local and international prices. Founded by former LDC trader Eric Cardoni and supported by logistics giant Rumo, BAB is set to begin operations by year-end in Mato Grosso and Goias, aiming to handle around 5 million metric tons in its first year.
The Right Cow…
Gado Certo, a Mato Grosso-based startup, is revolutionizing cattle trading through its digital platform, streamlining the buying and selling process. Since its founding in 2019, the company has grown rapidly, moving from trading 528 cattle in its first year to a projected 70,000 by the end of 2024. Major clients, including SLC and Amaggi, are already using the platform. Earlier this year, Gado Certo secured an $800,000 investment from venture capital firms Bossa Invest and KPTL to fuel its expansion.