Tag Archives: LatAm

>Brazil – prepare for devaluation


>Brazil – prepare for devaluation
Guest post By Thierry Apoteker, CEO and chief economist at TAC

TAC quantitative models show that the BRL is currently overvalued by about 25 to 30 per cent. The IMF index for the BRL real effective exchange rate suggests a 50 per cent overvaluation. With a combination of slower growth, higher external deficits, large speculative inflows and difficulty in cyclical management, the question is now not if the currency will depreciate, but when and by how much.

Guest post: Brazil – prepare for devaluation

China’s Brazilian shopping spree


China’s Brazilian shopping spree

[3] http://www.amazon.com/Rising-Powers-Shrinking-Planet-Geopolitics/dp/0805080643

Brazil | Foreign Investment | China | Resources

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The global power of Brazilian agribusiness – CMAE | Commodities Corn, Soybeans, Soybean Meal, Suppliers and Exporters.


The global power of Brazilian agribusiness

The global power of Brazilian agribusiness
Brazilian farmers don’t need wait for Government to solve the problems of infrastructure or credit to become “world leaders unattainable”, according to a study from the Economist Intelligence Unit, a British research Company linked to the magazine “The Economist”.
The study, titled “The global power of Brazilian agribusiness”, points out the challenges of infrastructure and other difficulties of rural producer such as to obtaining credit, but adopts a positive tone. Instead of lamenting, suggests ways for the farmer to overcome these problems, improving management techniques.

Brazil is world’s fi fth-largest country by geographical area and the largest in terms of arable land.
Although only a fraction of its land is exploited, the country produces a highly diverse array of
agricultural goods. This puts Brazil in a unique position to lead the global agricultural sector in the
medium to long term. With an abundant supply of natural resources—water, land and a favourable
climate—it has the opportunity to be the largest agribusiness superpower, supplying the world market while also providing affordable food for its own population.
The country already ranks as the top global supplier of products as diverse as beef, orange juice and
ethanol, and is expected to continue to expand its exports in other areas as well, such as cotton, soybean oil and cellulose. Its markets are also diverse: China is now the largest market for Brazilian agribusiness products, and sales to Eastern Europe, the Middle East and Africa are also growing rapidly.
To maintain this trajectory, Brazil must build on the signifi cant improvements in productivity that
underpin its current success and overcome the barriers to full realisation of its potential. Obstacles range from scarcity of credit to logistical logjams, from protectionist measures in key markets to environmental concerns.
Frontier regions are a testament to what is right, and wrong, with Brazil’s agribusiness sector. The rich
harvests from the country’s vast hinterland have more than paid back public and private investment in research to create new plant varieties adapted to the region’s soil and climate. Large-scale production and professional management have helped to offset the high costs and tight margins of farming such areas.
Attracted by the promise of growth, investors have both fi nanced agriculture’s expansion and provided technological know-how. Yet agricultural endeavours in these regions are burdened by inadequate transport and insuffi cient storage capacity. Productivity in such segments as beef production and corn remains low. Margins remain tight.
The industry’s strong performance today is based on changes in business models, farming practices and technology over the past 30 years. For Brazil to fulfi l its potential as a global agribusiness powerhouse in the coming decades, companies must continue to innovate, transforming how and where they do business.
Leading companies have successfully tested different paths to expanding Brazil’s agribusiness beyond
the country’s borders. To overcome protectionist barriers in the US and Europe, they have diversifi ed their offerings, improved sanitary controls and acquired foreign competitors. They have increased the value of products sold in developed markets, but also have penetrated emerging markets worldwide.

Further investments and transformations are needed so that the agribusiness sector can thrive in the
coming decades. These include:

  • l Infrastructure—transport, port and storage—must be upgraded to meet current and future needs.
  • l Land must be used more productively through innovative farming techniques. Growth will come through better use of existing crop and pasture land, not just the opening of new areas.
  • l Research must continue to ensure development of crop varieties adapted to Brazil’s climate and soil conditions.
The EIU study was sponsored by Accenture.
The report is available for download in English and Portuguese

The global power of Brazilian agribusiness – CMAE | Commodities Corn, Soybeans, Soybean Meal, Suppliers and Exporters.

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Colombian Exports Could Reach $40 Billion In 2010


charging ahead!!!

Colombian Exports Could Reach $40 Billion In 2010 
First Published Monday, 12 July 2010 11:29 pm – © 2010 Dow Jones 
(Updates with comments from Trade Minister; adds details and background) 
By Darcy Crowe 
Of DOW JONES NEWSWIRES 
BOGOTA -(Dow Jones)- Colombian exports are on pace to reach a record-breaking $40 billion this year as companies offset a decline in exports to neighboring Venezuela by finding new 
markets in Central America and the Caribbean, Trade Minister Guillermo Plata said Monday. 
The government expects exports to climb 22% in 2010 and break the $37.2 billion mark from 2008, despite a diplomatic dispute with Venezuela that has led to a 70% plunge in sales to that 
country, Plata said. 
“Colombia is diversifying its exports, and in the last three months, firms have started to offset the losses to Venezuela,” he said. Venezuela has traditionally been Colombia’s second-largest 
trading partner, surpassed only by the U.S. 
Venezuelan President Hugo Chavez essentially shut the border to Colombian products last year in a heated diplomatic spat with Bogota. President-elect Juan Manuel Santos has said that 
fixing diplomatic and trade relations with Venezuela will be one of his priorities. Chavez is slated to attend Santos’ inauguration on Aug. 7. 
Plata said that even if the new administration is able to reopen the Venezuelan border to Colombian goods, the main goal should be diversifying exports. “Putting all our eggs in one basket 
is very risky,” he said. 
Exports to Venezuela could also suffer even if relations are restored due an economic recession and strict currency controls. 
As a result of the problems with Venezuela, China is now Colombia’s second-largest trading partner. Plata, however, highlighted that the products Colombia used to sell to Venezuela, such 
as manufactured and agricultural goods, are being redirected to markets in Central America and the Caribbean. 
This year’s export boom, however, has been driven by sales of commodities like oil, coal, coffee and ferronickel. Manufactured and agricultural goods, among others, are down 4.5%, a 
figure that Plata says is the result of the problems with Venezuela, which was a key market for these types of items. 
“It’s actually a very good number if you consider that sales to Venezuela are down 70% and shows that other markets are compensating for the decline,” he said. 
Foreign direct investment, meanwhile, could reach $10 billion this year, as money continues to pour into Colombia’s booming oil and mining industries, Plata said. Foreign direct 
investment in the country so far this year was $4.4 billion, 8.5% higher than in the same period in 2009. 
-By Darcy Crowe, Dow Jones Newswires; (57) 1 703 8953; darcy.crowe@dowjones.com 
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