Research

Brazil agribusiness quarterly Q2 2025

9 July 2025 12:01 RaboResearch

Andy Duff

Head of RaboResearch Food & Agribusiness - South America; Global Strategist - Sugar

Andrés Padilla

Senior Analyst - Beverages, Dairy, F&A Supply Chains

Marcela Marini

Senior Analyst – Grains & Oilseeds

Guilherme Morya

Senior Analyst - Beverages

Bruno Fonseca

Analyst – Farm Inputs

Wagner Yanaguizawa

Analyst - Animal Protein

Renan Alves

Macro strategist

Maurício Une

Head of South America Macro Strategy

Read the latest developments in Brazil’s key agribusiness sectors, including planting updates, harvest outcomes, production forecasts, price movements, and more.

Highlights include:

FX: In the short term, US trade policy and the interest rate differential appreciate the Brazilian real, but geopolitical and fiscal risks may cause it to depreciate again. We see the exchange rate at BRL 5.90/USD by the end of the year.

Weather: While average rainfall may fall below historical patterns in Q3, key agribusiness regions should see adequate soil moisture.

Fertilizers: Rising fertilizer prices are expected to drive production costs for the next soybean crop higher. The availability of phosphates for this crop remains uncertain due to import delays.

Cane, sugar, and ethanol: World sugar prices fell 15% in Q2 2025, despite little change in global fundamentals. Center/South cane yields in May and June should help calibrate the crop's potential.

Coffee: Despite the onset of winter in Brazil, declining exports, and ongoing geopolitical tensions, coffee prices remain under pressure due to improved supply conditions, particularly as the Brazilian harvest begins.

Soybeans: Soybean exports from January to June reached 51.5m metric tons, up 3% year-on-year, according to SECEX. Despite US-China trade tensions, growth remained moderate in early 2025.

Corn: Changing domestic fundamentals and the appreciation of the Brazilian real contributed to a decline in corn prices over the course of Q2, with CEPEA estimating the ESALQ Corn Index fell by 23% compared to March 2025.

Cotton: Domestic cotton prices rose 12% year-on-year in June, while prices on the New York ICE exchange fell 9% over the same period. Strong external demand and positive export basis were key drivers behind the divergence.

Beef: Beef exports continue at a record pace, while supply slows on a year-on-year basis. Live cattle prices likely reached their lowest point of the year in Q2, with the futures market signaling a recovery starting in Q3 2025.

Orange juice: Rising global supply resulting from a project 36% increase in São Paulo production is expected to keep juice and fruit prices under pressure at the beginning of the 2025/26 harvest.

Dairy: Firm supply growth resulting from high farmer margins and favorable weather should cause farmgate prices to decline moderately in Q3 2025.

Pulp: Pulp prices are set to remain under pressure in Q3 as global supply rises. However, unscheduled downtimes are increasing, which should help rebalance the market by late 2025.