Facility is expected to increase production of pivots by 50%

03/25/2024

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Rodrigo Parada and Luiz Alberto Roque — Foto: Divulgação

Bauer do Brasil, an irrigation equipment company, will invest R$40 million in the construction of a new plant in São João da Boa Vista, São Paulo. The investment is intended to expand the company’s operations in Brazil and Latin America and increase its share of the irrigation market. The new unit will occupy a plot of land opposite the site where the company has been operating since 2017. The land was donated by the local city government, and in return, Bauer committed to creating at least 100 new jobs over up to four years.

The Austrian company has been present in Brazil for 20 years, and today 95% of its turnover comes from the sale of pivots produced in the country. In 2023, according to the company, total sales will reach R$460 million.

In an interview with Valor, Luiz Alberto Roque, Co-CEO of Bauer do Brasil, said that with the new plant, the goal is to increase the capacity to produce pivots by 50%. In addition, the new plant will assemble reels, another irrigation model, and separators dedicated to waste and manure management. This equipment is currently imported from Austria.

According to Rodrigo Parada, also co-CEO of Bauer do Brasil, starting to manufacture other products from the catalog in the country means more than increasing profitability, as it reduces dependence on imports. “The whole issue of intellectual property and technology that characterizes Austrian quality is now coming to Brazil and Latin America,” he said.

Bauer’s sales in Europe are divided almost equally between the three products it offers, according to Mr. Parada. Brazilian executives hope to increase the share of reels and separators in the company’s sales and reduce the dominance of pivots.

Separators are used on livestock farms to separate solid waste from liquids.

Both pivots and reels are sprinkler irrigation systems that simulate rain. While center pivots are suitable for large areas and irrigate in circles, reels are more suitable for smaller areas as they work in a line. Bauer’s main customers are producers of soybeans, cotton, corn, and wheat.

Work on the new factory is expected to begin this year and be completed by 2025. The structure will include a new factory, training center, and offices.

The training center will be used to train sales staff and agents. Bauer works with a dealer system, with representatives spread throughout the main agricultural regions of Brazil and Latin America. Aiming to create a kind of “model” of best practices for selling its products, Bauer will open its first store in Campo Grande, Mato Grosso, in June.

Before the company recoups its investment, it expects its sales to grow by 23% to 26% this year. “The company has boomed during the pandemic. In the last four years alone, we’ve grown 7.6 times, mainly in the pivot market, but also in the technology solutions and services market,” added Luiz Alberto Roque.

Mr. Roque founded Irricontrol, an irrigation technology platform that manages and automates processes, which was acquired by the Bauer Group in 2019 to become its global technology arm.

(*Nícolas Damazio reporting was supervised by Alda do Amaral Rocha.)

*Por Nícolas Damazio* — São Paulo

Source: Valor International

https://valorinternational.globo.com/