Drought affects agriculture and brings down the sector’s GDP

Folha de S. Paulo , Mauro Zafalon in 01/09/2021

The agricultural sector registered a drop of 2.8% compared to the first quarter of 2021, after several important crops, such as coffee and sugarcane, suffered from the water crisis.

Initially forecast at 274 million tons, the expectation for the 2021 harvest was reduced to 254 million tons and could go down even further. In the assessment of the Institute for Applied Economic Research (Ipea), the agricultural GDP should end the year at a rate of 1.7%.

In addition, the effects of frost and extremely low temperatures in the second half of 2021 should affect productivity in 2022.

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