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Brazil remains optimistic about EU deal

Government expects Mercosur pact to be signed despite concerns over safeguards

 

 

 

 

12/16/2025 

EU safeguards could temporarily suspend tariff preferences on Mercosur farm imports — Foto: Marcos Oliveira/Agência Senado
EU safeguards could temporarily suspend tariff preferences on Mercosur farm imports — Photo: Marcos Oliveira/Agência Senado

Amid mounting pressure from European countries in the final stretch ahead of the signing of the trade agreement between Mercosur and the European Union, Brazil’s Foreign Ministry has received signals that the deal will be approved next Saturday (20).

Despite the optimistic tone, Gisela Padovan, secretary for Latin America and the Caribbean, said the safeguards approved by the European Commission are a source of “concern.”

“The signal is one of confidence [that it will be signed],” the ambassador told reporters on Monday (15). According to her, if there were any “minor delay” in the signing, this would not initially be “a major problem.” “What matters to us is to close out 26 years of negotiations that are important for both sides,” she added.

Padovan said Brazil managed to include important elements in the agreement compared with the 2019 negotiations, especially in the areas of government procurement and intellectual property. “Brazil remains optimistic. We depend on the vote in the [European] Council, but we have signals that the idea is indeed to sign.”

That confidence stems in part from the fact that even if France and Poland oppose the agreement, it would still have a quorum for approval. There are, however, concerns over the safeguards that will be examined on Tuesday (16) by the European Parliament.

In practice, the new safeguards allow for the temporary suspension of tariff preferences on agricultural imports from Mercosur countries if those imports harm European Union producers. “I am familiar with the safeguards issue and I think it is something that deserves concern,” the ambassador said.

President Luiz Inácio Lula da Silva is expected to travel to Foz do Iguaçu on Friday (19) to attend the Mercosur and Associated States Summit the following day. There is also an expectation that the agreement will be signed on that date. It has yet to be confirmed whether the Brazilian president will hold bilateral meetings, as his schedule will be tight.

According to the ambassador, European Commission President Ursula von der Leyen and European Council President António Costa are expected to attend. Mercosur heads of state are also expected to be present.

As reported by Valor, the Brazilian government sees no room for a months-long postponement of the signing of the Mercosur–European Union agreement. The federal administration’s assessment is that if the European Union delays the process until February or March, for example, new obstacles will continue to emerge that could prevent the trade deal from being finalized.

In the view of government sources, in a context of weakening multilateralism, failure to conclude the Mercosur–European Union agreement would send a negative signal, suggesting an inability to reach an understanding between two of the world’s largest economic blocs.

Government interlocutors also say concessions have already been made on agricultural products, especially meat, and that there would be no justification for resistance to the agreement.

*By Sofia Aguiar  — Brasília

Source: Valor International

https://valorinternational.globo.com/

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Brazil, a society in transformation

Valor Econômico’s 25-year anniversary edition explores how country can lead change through Amazonian bioeconomy, along with ongoing impacts of social, technological, and political changes domestically and abroad

 

 

 

05/02/2025

Fishers at the Middle Juruá Extractive Reserve in Amazonas state — Foto: Araquém Alcântara
Fishers at the Middle Juruá Extractive Reserve in Amazonas state — Photo: Araquém Alcântara

Big changes in the world are triggering a broad rearrangement of society and demanding solutions as innovative as the challenges created. Urgent and significant actions are critical to mitigating the impacts of the climate emergency, the world’s biggest threat now. This edition of Valor Econômico, which also commemorates its 25-year anniversary, brings a special report showing how Brazil, holding 60% of the Amazonian biome, can transition into a low-carbon economic model that protects biodiversity through bioeconomy.

Farmers and experts report on the many challenges of development based on sustainable use of the forest, and of promoting production chains connected with sociobiodiversity, as the image above shows. Captured by the lenses of photographer Araquém Alcântara, it records the day-to-day of fishers in the Middle Juruá Extractive Reserve in Amazonas state.

Socially, other stories translate to our readers the zeitgeist. Such issues as gay relationships, using frozen embryos, and digital asset inheritances have been demanding legislative changes.

Other transformations like religious conversions, entrepreneurial culture, and social media, meanwhile, are affecting political identification in Brazil.

This commemorative edition also offers a broad menu of special reports, including a one-week foray in Buenos Aires probing the actions of President Javier Milei, which have struck down inflation and pleased businesses but also triggered doubts about their social cost.

*By Daniela Chiaretti, Marli Olmos, Laura Ignacio and Cristiane Agostine  — Belém, Buenos Aires and São Paulo

Source: Valor International

https://valorinternational.globo.com/

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Brazil poised to become the “Saudi Arabia of carbon markets”

Milken Institute hosts São Paulo meetings to showcase sustainable investment opportunities

12/02/2024

Executives from the Milken Institute, an American think tank that connects philanthropists and investors globally, are holding their first major event in São Paulo this week. The gathering brings together entrepreneurs, CEOs, public officials, and environmental specialists to explore investment opportunities, particularly in climate change initiatives. Brazil’s burgeoning carbon credit market is a key focus for the institute.

The Milken Institute, a non-profit organization, hosts high-profile conferences in cities like Singapore, London, Abu Dhabi, New York, Washington, and Los Angeles to tackle global challenges with innovative ideas.

“Within the institute, there is a network of more than 400 pension funds, sovereign wealth funds, and family offices managing a collective allocation of approximately $34 trillion,” said Rodrigo Bettini, senior advisor and head of the institute’s Latin America division.

“They attend our events to meet people and learn about advancements in diverse sectors such as agribusiness, AI, finance, education, and climate.” These meetings also attract professionals seeking capital injections for their projects.

Around 150 participants are expected at the São Paulo events, including a dinner on Monday and a breakfast on Wednesday. “Our goal is to guide foreign investors toward sustainability opportunities in Brazil,” said Daniella Levy, head of the institute in Brazil. Another aim is to strengthen relationships with Brazilians who could join the institute’s flagship annual conference in Los Angeles.

The Milken Institute was founded by Mike Milken, a prominent figure in the U.S. financial market during the 1980s. Convicted of securities law violations, Mr. Milken served time in prison and was granted clemency in 2020 by then-President Donald Trump. Today, he focuses on the institute, where he serves as chairman, and on the Milken Center for Advancing the American Dream.

Ms. Levy, Mr. Bettini, and the institute’s CEO, Richard Ditizio, are spearheading this week’s discussions. Mr. Bettini highlighted Mr. Ditizio’s positive impression of Brazil during a visit in January. “He was struck by the breadth of actions and policies here addressing sustainability and ESG standards,” said Mr. Bettini. “In our opinion, Brazil is advancing in sustainability, technology, fintech, and infrastructure in innovative ways, but the world isn’t aware of these developments.”

The institute aims to expand global awareness of Brazil’s innovations, “channel more foreign investment into the country, and support these initiatives on a global scale,” said Mr. Bettini. A key focus is the carbon credit market, seen as a transformative opportunity for the nation.

“We believe Brazil will be the Saudi Arabia of the carbon credit market, and we are confident this sector will revolutionize and create significant socio-economic opportunities for Brazilians,” said Mr. Bettini.

In November, the Chamber of Deputies (Brazil’s Lower House) approved a bill establishing rules for the carbon credit market, following its earlier passage in the Senate. The formalization of these rules has been highly anticipated, with Brazil widely recognized for its immense potential in carbon projects.

The agenda for the two meetings, hosted at a São Paulo hotel, will cover themes such as sustainability, environmental preservation, economic growth, living conditions in the Amazon, and strategies to attract foreign investment. These topics are expected to gain further prominence in 2025 when Brazil hosts COP30 in Belém.

By Marcos de Moura Souza

Source: Valor International

https://valorinternational.globo.com/
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Analysis: Brazil remains one of the world’s biggest vehicle producers

For a while, it looked like carmakers were about to give up production in the country

03/07/2024

Stellantis's unit in Goiana: carmaker announced an investment of R$30 billion in Brazil over the next five years — Foto: Divulgação

Stellantis’s unit in Goiana: carmaker announced an investment of R$30 billion in Brazil over the next five years — Foto: Divulgação

For a while, it seemed as if carmakers were on the verge of abandoning production in Brazil. At least, that’s what some facts indicated at the beginning of the decade.

The most striking was that of Ford, which decided to close all its factories in the country between 2020 and 2021. Then Mercedes-Benz also closed the car factory it had built in the state of São Paulo, arguing that the facility could not accommodate the most modern lines of cars of a new era, that of electrification.

Also in 2020, Audi decided to stop production at its partner Volkswagen’s plant in Paraná to assess the conditions in the country and the market. At the same time, there was speculation that General Motors would also leave the country. First, following a statement by the company’s CEO, Mary Barra, who implied that the operation would not be maintained if it continued to make losses.

Other automakers limited themselves to one-time investments. Renault, for example, announced a smaller program that would run for a year until it had a clearer idea of what would happen to the market after the pandemic.

COVID-19 was partly to blame for the slump in the industry. So was the semiconductor crisis, which shut down entire factories for many days over several months in 2021, 2022, and part of 2023.

Still, it was striking to see the automotive industry announcing major investments in electric car factories in developed countries while little progress was being made here.

Some said, among those who risk analyzing the sector, that the huge park of vehicle and auto parts manufacturers in Brazil was doomed to become scrap metal.

But suddenly this scenario changed completely. It began with the Chinese brands. BYD and Great Wall Motor decided to enter the country. GWM bought Mercedes’s plant and BYD took over Ford’s former plant in Bahia. At the same time, Audi decided to take back its space and resume production in Paraná.

From the end of 2023, new cycles began to emerge for incumbent companies. Renault’s Brazilian operations were incorporated into the company’s global plan.

The coming and going of the top executives of the sector began in Brasília. The global heads of these companies decided to come to the country to personally deliver the news to the Brazilian government.

Since November, several high-ranking executives have visited the presidential palace, including Makoto Uchida, CEO of Nissan, Shilpan Amin, head of GM’s international division, and most recently, Carlos Tavares, CEO of Stellantis, who was in Brasília on Wednesday.

The announcement of an investment of R$30 billion in Brazil over the next five years is not only a decisive step by Stellantis to maintain its leadership in Latin America, an important region for its activity. It also confirms that Brazil will not disappear from the map of the automotive industry—at least not before the next decade.

“I’ll see you in 2030,” Mr. Tavares said in an interview on Wednesday (6). In that time, Brazil will have everything it needs to remain among the world’s top 10 vehicle producers. It was eighth in 2022. The 2023 ranking has not yet been announced.

The country’s economic environment weighed heavily on the assessments of these companies, which tend to make long-term investments. Executives also appreciated the government’s tax incentives in programs that reward innovation and emissions reductions, such as the recently launched Mover.

In the case of large companies such as Stellantis, Toyota, Volkswagen, Renault, and perhaps GM, the funds will be used to produce hybrid cars—with an electric motor and an internal combustion engine that can run on ethanol.

This solution will help put Brazil on the electrification map without causing major trauma to the current production park and without making cars unaffordable for the majority of Brazilians.

*Por Marli Olmos — Brasília

Source: Valor International

https://valorinternational.globo.com/
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Brazil sees unprecedented delay in fertilizer sales

By the end of the first two months, purchases had reached only 20% of what was expected, half of what was sold in previous years

03/06/2024

Marcelo Altieri — Foto: Divulgação

Marcelo Altieri — Foto: Divulgação

Fertilizer sales in Brazil have never been so slow, according to companies in the sector, reflecting farmers fearful of crop failures and climatic problems.

By the end of the first two months of the year, the Brazilian market had bought only 20% of the volume of fertilizer expected for 2024, half the percentage sold in previous years at this time, when it was close to 40%, according to Yara, the Norwegian multinational that leads the nitrogen market in the country.

“It’s creating a lot of stress in the logistics chain. We’re expecting some hurdles,” Yara Brasil CEO Marcelo Altieri said after an event in Brasília. “We have never seen a purchasing reality so far behind the annual progress, so it could bring logistical problems.”

The company did not provide specific figures on expected fertilizer sales for 2024 but said the slower pace was a reality of the market in general.

This delay could lead to distribution and logistics problems in the country in the coming months, as when sales start to flow, orders could pile up at dealers and the fertilizer may not be delivered in time for planting of the 2024/25 crop.

A survey by StoneX shows that the volume of fertilizer sales for delivery in the first half of the year reached 51% by February. A year earlier, this percentage was 62% and by February 2022 it was 60%.

For deliveries scheduled for the second half of the year—when the agricultural calendar for the 2024/25 harvest begins—there is also a lower commercialization rate of around 20%. Compared to the last two years, the rate in this period was 30%.

According to the Israeli company ICL, which produces minerals and special fertilizers, the scenario is expected to reverse in the coming months, given the favorable conditions of the exchange ratio (an indicator that measures purchasing capacity) between fertilizers and grains.

“The resumption of the market is essential to avoid logistical problems and the consequent difficulty for producers to access technology,” said Ithamar Prada, the company’s chief marketing and innovation officer. According to him, producers are now focused on completing the harvest and assessing the conditions for commercializing soy.

Mr. Altieri said that farmers are waiting until the last moment to make a purchase decision. In 2023, the delay in purchases was due to the expectation of lower prices. Nevertheless, the chain managed to organize itself and meet demand.

“This year is different. The trends are not the same, many products are already at the [price] bottom and some are already recovering. The longer farmers wait, the more logistical problems we could face during the harvest,” Mr. Altieri added.

The doubts generated by the delays in purchases have not yet shaken the scenario of stability projected for 2024. According to Mr. Altieri, the profitability levels of the agricultural sector and the fertilizer industry have returned to pre-pandemic levels after years of historic highs and lows in the market in 2022 and 2023, respectively.

“There was a lot of suffering, a lot of pain, and a lot of price declines during this transition. There were almost 12 months of falling fertilizer prices. It was very challenging. But this year is a year of stability,” he said.

However, the executive admitted that the scenario of financial hardship in the agribusiness sector, with the rise of requests for court-supervised reorganizations by companies and farmers, is concerning.

“Farmers pay the bills of all our companies. If farmers are struggling, it’s something that concerns us and we want to work to help reverse this scenario as quickly as possible by generating more productivity for them, and higher quality and profitability,” said Mr. Altieri.

*Por Rafael Walendorff, Isadora Camargo — Brasília, São Paulo

Source: Valor International

https://valorinternational.globo.com/
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