Flavio Maluf Outlines GDP Fluctuations in Brazil

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According to the Brazilian Institute of Geography and Science, Brazil’s economy grew by about 0.4 percent during the first quarter of 2018 in comparison with 2017’s fourth quarter. In comparison with the first quarter of 2017, the economy grew by 1.2 percent. These figures were drawn from the agriculture sector. When this sector was analyzed by itself, it was apparent that the growth between 2016 and 2017 was not as good as the growth between 2017 and 2018. Flavio Maluf talked about the subject in Terra.com.br recently and shared some insights about Brazil’s economy.

Flavio Maluf Becomes the President of Eucatex

Flavio is the president of Eucatex, which is a company that manufactures panels for construction, decorating and a variety of other purposes. It is one of the largest suppliers in Brazil today. However, it started out as a modest sawmill in the early 1950s. Flavio Maluf assumed his leadership position in the family business in 1997. He went to the Armando Alvares Penteado Foundation and studied mechanical engineering before that. His entrepreneurial spirit led him to pursue business instead. Flavio has been focused on the family business for more than two decades. Also, he is the president of Grandfood.

Many people who are familiar with Flavio also know of his father since he is a respected politician and an admirable businessman. Although the family business was already large and prosperous when Flavio took over, he expanded the empire with his skills, hard work and dedication. In addition to being a successful businessman, Flavio is an adviser to other entrepreneurs today. He cautions people who want to start businesses in Brazil. Many people assume that owning a business means working less and earning more.

However, Flavio gives them a more realistic perspective of what to expect. He emphasizes the importance of hard work and persistence to fuel success. Also, Flavio helps people understand that there are multiple business models today and that some structures do not require people to have a large amount of capital for an initial investment. He enjoys helping entrepreneurs find investors and other ways to acquire startup money.

Brazil’s Comparative GDP Statistics

Brazil’s 2018 GDP of livestock and agriculture dropped by about 2.6 percent between January and March in comparison with the same period in 2017. In late May, a large number of truck drivers staged a demonstration that stalled the transportation of products across the country for about 10 days. The agriculture sector’s numbers were also affected during April, May and June. In one major part of the country, production slowed in several smaller areas and stopped in others.

According to Flavio, almost 20 percent of the sugarcane harvest takes place between April and June each year. Also, more than 30 percent of the corn harvest takes place during that period. When these products were not properly circulated earlier in 2018, the delay affected everything from feed production to trading. With the feed issue, there was a disruption in the creation of important proteins. Flavio pointed out that meat producers did not have access to enough food for their meat animals, and the lack of animal food meant a lack of meat for Brazil.

Another industry that was affected was the coffee industry. During the second quarter, this industry completes about 60 percent of its harvest each year. It was especially affected by the reduction of the availability of raw materials in 2018. Exporters were not able to place their products in ports, and that affected the GDP as well.

While some industries suffered, the soybean industry flourished. It saw a record harvest with 119 million tons. In the soybean industry, about 60 percent of the harvest takes place during the first quarter each year. Another important industry for the first quarter is tobacco. About 50 percent of its harvest takes place during that period.

GDP Ups And Downs

Any benefits for the GDP that came from soy production in the first quarter were minimized by the decrease in corn production. Also, rice and tobacco reductions slowed the pace and brought down the GDP rate by a total of 2.6 percent. However, the drop in the GDP was not unexpected.

Flavio said that the previous year’s numbers were high and that 2017 was a year of greater productivity. There was a record harvest that totaled about 240 million tons across the entire agriculture sector. From January through March in 2017, the agricultural GDP grew by about 18 percent in comparison with the same period in 2016.

Category claims started on May 21 with the truck driver strike. The claims were due to a diesel oil price decrease along with road freight regulation changes. After the event, the consequences for the country were multiple types of food shortages and logistical challenges. Although there were considerable losses, the demonstrations garnered support from most of the population. Flavio hopes that the demonstrations will lead to positive changes that improve the economy and boost Brazil’s GDP next year.

Follow Flavio Maluf on Twitter @Flavio_Maluf

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