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Clear Differences within Investment Intentions

Chart of the month (June/2019)

Comparison of the top four investments in arable farming in Germany and Brazil – Importance of changing climatic conditions leads to a demand of higher effectiveness and impact – farmers have higher income due to rising exports – current “Chart of the Month” by DLG Agrifuture Insights

Brazil's role in the world’s agriculture is becoming more important as US-China trade disputes means increased soya exports from Brazil to China. The export of poultry and pork is also booming. This has a direct influence on significantly increasing investment intentions. For example, 56 percent of the producers in Brazil surveyed, are planning to invest during the next 12 months, which represents an increase of 20 percent compared to 2018. About 40 percent of the mentions state that soybean production is the most important investment field. For another 20 percent of the investments by the farmers surveyed, investments in crop cultivation technology is also considerable.

The current chart of the month by DLG-Agrifuture Insights shows a comparison of the investment intentions in the top four focal areas of tractors, combines, seeders as well as fertilizer and crop protection technology.

In particular, the increase in clout is a key investment reason for Brazilian farmers. For 64 percent of the cash crop producers – and this is by far the biggest group of statements – the challenges of the upcoming climate change is the most important reason as there will be shorter time frames left for the work to be done on the field. Therefore, farmers are reorganizing their sowing technology to best adapt to these changes.

Within the next 12 months, one out of every two of the cash crop producers surveyed in Brazil wants to purchase mulch or direct sowing technology, compared to 13 percent of the farmers surveyed in Germany. This underlines also a main difference in cultivation practices between Brazil and Germany.

Another 39 percent of the cash crop producers polled in Brazil want to purchase tractors, compared to 13 percent in Germany. And the investments in combines, planned at 18 percent in Brazil, will be significantly higher than the 7 percent in Germany. The Brazilian cash crop growers are thus vigorously renewing their machinery in order to increase production with high efficiency and clout. Thereby they want to gain profits from the favorable conditions on the international markets.

DLG-Agrifuture Insights is the new DLG knowledge brand and platform for international trend analysis in the agricultural sector. It examines the business environment in agriculture and agribusiness through a global panel of 1,650 leading farmers in 11 countries. Every month, DLG-Agrifuture Insights publishes a "Chart of the Month" from the extensive range of development trends in the international agricultural markets.