AgroPages-BASF forecasts up to 35% of revenue from barter operations in Brazil-Agricultural news

BASF has projected a revenue between 30% and 35% coming from "barter " operations with farmers in Brazil. These payment exchanges of inputs with post-harvest grain delivery without monetary intermediation have been sought by farmers as an alternative to the current financial insecurity in the country.

"This percentage was a little bit below 30% in the last few years, but the barter operations have been in a process of consolidation," affirmed the vice-president of the Crop Protection Unit , Francisco Verza, to Brazil Newspaper Valor Econômico.

According to the executive, the current exchange variations, commodity prices, high interest rates and difficulties in obtaining credit reinforces the insecurity and uncertainty in the sector, but increases the importance of "Barter" for the operation could help to "offset" some negative effects of these factors. "We will continue to extend the possibility of barter for other products like coffee, sugar, ethanol, and cotton, always with a trading intermediation," he reveals.

Verza explains that these operations tend to follow concentrated in Cerrado regions in the states of the Midwest and also in Matopiba (confluence region between Maranhão, Tocantins, Piauí and Bahia) - the latter even with many new planting areas, where profitability is most at risk.

In 2007/08, the "barter" accounted for 13% of total sales of crop protection products in Brazil; in 2013/14, the slice level dropped to 4%.