Research

Brazil agribusiness quarterly Q1 2025

9 April 2025 12:01 RaboResearch

Andy Duff

Head of RaboResearch Food & Agribusiness - South America; Global Strategist - Sugar

Andrés Padilla

Senior Analyst - Beverages, Dairy, F&A Supply Chains

Marcela Marini

Senior Analyst – Grains & Oilseeds

Guilherme Morya

Senior Analyst - Beverages

Bruno Fonseca

Analyst – Farm Inputs

Wagner Yanaguizawa

Analyst - Animal Protein

Renan Alves

Macro strategist

Maurício Une

Head of South America Macro Strategy

More authors

Read the latest developments in Brazil’s key agribusiness sectors, including planting updates, harvest outcomes, production forecasts, price movements, and more.

Highlights include:

Special - A first look at tariffs: On April 2, US President Donald Trump revealed the reciprocal import tariffs that the US will now levy on trade partners worldwide. For Brazilian goods, the tariff was set at a baseline of 10%, while significantly higher tariffs apply to other trading partners.

FX: We project the exchange rate at BRL 6.09/USD by the end of 2025. The appreciation of the Brazilian real against the US dollar is driven by the cooling of the US economy, increases in interest rate differentials, and strong trade and investment flows, while its depreciation is influenced by anaemic global growth and domestic fiscal uncertainty.

Weather: After a rainy January, February and the first half of March were drier than normal. While this has benefited the harvest and planting of grains, it has raised concerns for sugarcane, orange, and coffee crops.

Fertilizers: The depreciation of the exchange rate during the last quarter of 2024 contributed to improved soybean margins in the current season. However, this improvement does not fully resolve the issue of tight margins.

Cane, sugar, and ethanol: Below-average rains in February and the first half of March have tempered some of the earlier optimism regarding the size of the 2025/26 crop. However, the weather in early Q2 2025 can still influence crop prospects and market sentiment.

Coffee: Geopolitical tensions, adverse weather conditions, and supply uncertainties are causing volatility in the coffee market.

Soybeans: RaboResearch estimates record soybean production of 170m metric tons for the 2024/25 season, marking an increase of 15m metric tons compared to the previous year.

Corn: Over the past 12 months, corn prices in Brazil have experienced a significant increase, rising by approximately 42%. This substantial growth reflects the dynamic changes in the market and the various factors influencing supply and demand.

Cotton: Prices in the Brazilian market fell by 2% compared to twelve months ago. However, on the ICE, the fiber showed a 31% drop for the same period.

Beef: Exports remain strong while supply is slowing down, and calf prices are experiencing a significant appreciation.

Orange juice: Prices moved sharply lower in Q1 2025 due to expectations of a rebound in the Brazilian orange harvest in 2025/26 and weaker global demand. Fundecitrus is set to issue its first 2025/26 crop estimate in May, likely confirming a larger crop ahead.

Dairy: Firm supply growth from high farmer margins and less robust demand is expected to cause farmgate prices to start declining later in Q2 2025.

Pulp: While global prices rebounded in Q1 2025 due to early buying from importers, a more consistent price recovery is not expected before late 2025 as supply continues to increase.