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News

Brazil: A positive outlook for 2024

02/02/2024 - Sophie Colvine , Press release - 2024 Season
On the occasion of Tomato Day on 1st February, Tomate BR, the association created to promote the sustainable development of the tomato chain in Brazil, provides information on production, the scenario and expectations for 2024 
 
Brazil is variably ranked 6th or 7th globally in the production of tomatoes for processing, with the top three places occupied by the United States, China and Italy. Tomato products are present in practically every Brazilian home and constitute a widely diversified market that covers all consumer classes, offering everything from premium products to the most popular. In other words, from healthy pasta sauces to tasty condiments, tomato products are delicious and tasty and are packed with incredible nutrition, being a good source of vitamin C, fibre, potassium, iron, lycopene and other antioxidants. Even better, when fresh tomatoes are quickly cooked to become tomato products, the lycopene becomes even easier for the body to absorb. And today, 1st February, the date on which Tomato Day is celebrated, Tomate BR, the Brazilian Association of Processors and Users of Industrial Tomatoes, provides an overview of the sector and the production chain and also warns of the challenges to its sustainability.
 
As Vlamir Breternitz, Secretary Director of TOMATE BR, explains: ”The 2023 tomato harvest for processing in Brazil was undoubtedly one of the most challenging ever faced by the production chain. Shortfalls in productivity, due to adverse weather and production conditions, resulted in a volume around 22 per cent lower than that initially planned by the industries. This scenario had a significant impact on industrial planning and also on producers' profitability, which was practically nil in the face of production costs. " 
 
"In 2023, we cultivated a larger area with tomatoes in Brazil; however, the quantity produced was lower than in 2022." There is currently a global restriction on the supply of raw materials, which puts additional pressure on production costs. "Since Brazil is not self-sufficient in tomato raw materials, it is forced to import a significant part of its demand, putting pressure on the domestic market. In addition to the challenges related to supply, the tomato products  market is highly sensitive to the country's economic situation, a condition that can significantly influence consumption and therefore impact industrial and production operations" adds Breternitz,
 
Productivity in Brazil in the Main Producing Regions
- Recent years have seen consistent growth in Brazilian productivity.  
- However, in 2023, we returned to the production levels of the past decade, ending the harvest with a production of approximately 77 tonnes of fruit per hectare harvested.  
- This situation, atypical according to the expectations of the entire production chain, gives rise to hope that in 2024 the figures will return to levels close to those recorded in 2022.  
 
Producing regions: 
The production of tomato sauces and derivatives is active in most of the country. However, production of the fruit is concentrated, in order of quantity produced, in the states of: 
- Goiás (responsible for almost 70% of the total produced) 
- Minas Gerais 
- São Paulo.   
 
  

Growth 
Compared to 2022, the area cultivated with tomatoes for processing grew by 6%, however, due to climatic and production factors, there was a 7% reduction in the quantity of fruit produced over the same period.
 
For 2024, an increase in the planted area is expected, although this condition is not yet fully consolidated, since the climatic and operational situations are still being defined. 
 
Planted Area and Seasonality of the Crop: 
Brazil stands out as one of the few countries that grow tomatoes for industrial processing during the winter, unlike the others that have favourable climatic conditions only in the summer. As a result, all of the country's production regions grow tomatoes between February and October, with the transplanting period taking place from February to June and the harvest from June to October each year.  
 
Cost of Production: 
Growing tomatoes for processing involves advanced agricultural technology and mobilises an extensive production chain. Compared to 2023, the trend for 2024 indicates stability in production costs, with a reduction in input purchase values, but significant increases in costs related to labour and logistics. 
 
Profitability:
The tomato production chain faces narrow margins in all scenarios, both in the industry and among tomato growers. Production costs vary between 80 and 90 tonnes per hectare, depending on the level of technology used in cultivation.  This pressure represents a significant challenge for the entire chain, since any lack of control can result in considerable losses.
 
General Crop Balance in 2023 and Trends for 2024 
Despite the challenges identified in 2023, expectations for the 2024 harvest are positive. Production and operational bottlenecks identified in the previous year are being corrected by the chain, and a more stable climate is expected, with less rainfall, especially in the first half of the year, favouring crops that operate under irrigation systems. 
 
TOMATE BR believes that despite the major challenges that lie ahead, a joint effort between manufacturers and retailers is increasingly necessary if the chain is to establish sustainable and economically viable development, eliminating impacts and seeking solutions that benefit everyone involved.    

Source: Tomate BR 
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