In the last two years, the agriculture overall has had a better performance than livestock, changing a status which had remained stable for 13 years, from 1988 to 2001. In 2003, the crop-related sectors increased 2.2%, with a better performance than the livestock-related ones (-1.2%). The result of livestock is the first negative one in the last five years. 

The positive performance of agriculture industry in 2003 possibly results from the significant growth of industrial products used by agriculture (17.2%), with highlight to the segment of machinery and equipment (24.4%), which has recorded significantly high growth rates in the last three years. The favorable status of currency, the efforts towards the opening of new markets, and the adoption of programs to incentive the renewal of fleets (Moderfrota-BNDES) led to the increase of internal sales and of exports as well. 

Industrial products from agriculture face decrease of 1.7%

The group of industrial products from agriculture faced retraction of 1.7% in 2003. Only sugarcane derivatives (8.8%), corn (7.9%) and wheat (0.2%) accounted for positive results, but that was not enough to reverse the overall negative performance of crops. The Systematic Survey of Agricultural Production (LSPA) showed that the production of sugarcane reflected, to a great extent, the excellent prices of its main derivatives, sugar and alcohol, during the planting period, as well as the agreement between the federal government and the production sector in order to accelerate the production of alcohol and to guarantee the internal distribution of this product. The increase of milk output is related to the extremely favorable conditions of trade, such as the low level of international and domestic stocks, the rise of international prices and the favorable currency, besides the excellent climate conditions observed in the two harvests. On the other hand, as a predominant impact, there was retraction of the following industrial products: soybean products (-1.7%), coffee (-11.5%), cacao (-3.2%), cotton (-5.7%), orange (-25.4%), rice (-6.3%) and tobacco (-10.2%).  The decrease of orange was caused by climate-related factors which resulted in the postponing of harvesting. 

Industrial products used by agriculture record increase of 17.2%

The increase of 17.2% reached by the sector of industrial products used in agriculture, in 2003, is believed to have resulted, mainly, from the performance of agricultural machinery and equipment (24.2%), which accelerated once again. An example of this good performance is the cumulative increase of this sector, 106.5%, recorded between 1999 and 2003. Another highlight is the performance of manure and fertilizers, with increase of 10.9%. The significant production increase of machinery and equipment in the last few years has been affected by the bigger agricultural output, by the offer of low-interest rates in the modernization of agriculture program and by the bigger export of food products. 

Industrial products from livestock remain practically stable 

In 2003, the subsector of industrial products from livestock remained practically stable (0.1%), reaching, this way, the sixth consecutive year with positive rates. The slight increase recorded in 2003 reflects different performance among the segments. The group of cattle products (9.9%), which is most relevant among livestock derivatives, recorded its biggest increase since the beginning of the series, in 1992, and was benefited by exports. Hogs and pigs products (-11.0%) had its worst performance, as well as poultry products (-1.6%), which recorded the first negative result in this time series. The decline of domestic demand probably has contributed to the negative result of the latter. Milk products and offal also faced retraction, of -2.0% and -3.0%, respectively. 

Industrial products used by livestock recorded decrease of 4.7%

The subsector of industrial products used by livestock did not repeat the positive behavior of the last few years, and recorded the worst performance in the series (-4.7%), after five consecutive years of increase, a period in which the cumulative figure was 40.4%.  The result of -4.7% was a conequence of the reduced production of serum and vaccines (-18.1%) and of animal food (-1.0%). 

Agriculture industry recorded increase of 1.6% in 2003, whereas the average rate of national industry, in the same period, was 0.3%. In the last three years (2003/2000), agriculture industry grew 13.3%, surpassing the national industry (with a total 4.5%).  

For the third consecutive year, the growth rate of agriculture industry has surpassed that of general industry. It evidences the acceleration of industrial sectors related to agriculture industry when compared to industrial production as a whole. This result confirms the positive impact of agribusiness, mainly of exports, on the industrial activity. 

The evolution of quarterly-based index shows acceleration of agriculture industry in the fourth semester of the year.  After recording increase of 3.2% in the first quarter, agriculture industry remained unchanged in the second semester (0.0%) and recorded slight expansion between July and September (0.5%), eventually increasing 3.5% in the fourth quarter of 2003.