In order to understand the importance of the agrochemical industry to Brazilian agriculture, Reimagine Agro
spoke with João Sereno Lammel (Agronomic Engineer and Agrochemical Vice-President of ABIFINA, the Brazilian Association of the Fine Chemicals Industry, Biotechnology and its Specialties).
With extensive experience in the crop protection market, Lammel is also President of the Association of Agronomic Engineers of the State of São Paulo and Counselor of Ourofino Agrociência.
Reimagine Agro: How important is agribusiness to the country?
João Sereno Lammel: Statistics from the Brazilian Institute of Geography and Statistics (IBGE) show that Gross Domestic Product (GDP) grew by 0.2% in the second quarter of 2018, compared to the first three months of the year. The agricultural sector in the focus. However, to maintain and expand these numbers, the sector and the country need to evolve. Among the measures required to achieve development are increased productivity, greater income for farmers, and guaranteed domestic supplies and export surplus.
What about the agrochemical sector?
I consider the sector a key part of the agricultural chain, enabling it to reach and exceed its goals. However, it is a highly import-dependent market, lacking initiatives, corrections and a balanced tax structure to stimulate local production and reduce external dependence.
How do you assess the instability in the supply of raw materials in the sector?
Competitive and dynamic, defense companies are experiencing market instability due to changes in the Chinese chemical industry. The effects of this restructuring are already being felt, through the lack of products and increasing import costs. Of course, this situation will have further repercussions.
In Brazil, other factors that hinder growth and innovation are lack of predictability in the approval of products and lack of incentives for local formulation. Deadlines are also not met and procedures are time consuming, reducing and delaying the launch of solutions for the Brazilian agriculture market. In this scenario, it is essential to increase national production, to reduce our dependence on imports. To do this, the government needs to implement a stable and positive policy.
What are the main advantages of producing in Brazil?
There are many. The major ones include the fact that local companies operate with more independence and create solutions suitable for the Brazilian climate. Local companies also have production autonomy and greater mastery of technology. But Brazil still lacks this system, and its leaders should worry about creating a strong industry. Achieving this goal depends on many factors, such as the presence of industrial policies that encourage local production of technical and formulated products.
What is the role of the agricultural market in the Brazilian economy?
It is one of the main drivers of the country. The national producer, besides planting and harvesting, needs to consider several variables, such as climate, planting season, purchase of inputs, soil treatment and access to credit, among others, which include market conditions that impact his business, exchange, prices, costs, storage, and so on. Within the industry, the reality is no different, and increasingly complex scenarios that show themselves every day are challenging. The competitiveness of the pesticide market makes everyone look for constant improvements.
How do we overcome these challenges?
Strategic decision-making in agricultural production mainly requires knowledge and practice, but related industries are also key to obtaining a good harvest, with productivity and profitability. We need to understand the market and create plans to increase the competitiveness of farmers and companies, which will reap good rewards for Brazil.