The Brazilian Government, under the administration of Lula Da Silva, announced an investment of more than 4.7 billion reais (around US$ 1 billion) to improve agricultural routes.
This increase of 34% compared to the previous year seeks to enhance agricultural production and strengthen competitiveness, being vital for the sector in a scenario where the quality of roads is essential for the efficient transportation of grains and agro-industrial products.
Read also: Costs for agriculture: freight transportation prices rose more than 20% in January
“The price is directly linked to transportation costs. If we did not have these conditions on the roads, it is likely that the cost of soy production would be lower,” stressed Carlos Favaro, Minister of Agriculture.
Do you want to receive more information about the field?
In this sense, Favaro highlighted that “in Brazil, nothing contributes more competitiveness to agriculture than logistics infrastructure.” He highlighted the importance of having efficient and integrated transportation, along with ports that ensure fluidity, to increase income and the ability to compete in increasingly demanding markets.
The Minister of Agriculture, Carlos Favaro, emphasized that “these improvements are crucial to prevent soybean production costs from exceeding profitable margins.” (Photo: REUTERS/Ueslei Marcelino). By: REUTERS
They planned to divide the works considered “structural” into two large parts: “North Arc” and “South-Southeast Arc.”
Within the framework of the plan called “Agricultural Routes”, the Lula Government's main objective is to achieve that 80% of all routes in the country are in the category of “good condition.” To achieve this, they planned to divide the more than 60 works considered “structural” into two large parts.
Meanwhile, investments aimed at improving road infrastructure in Brazil will be distributed between two key regions, the “Northern Arc” and the “South-Southeast Arc.” In the first case, which covers the northern and northeastern states of the country, the investment will increase from 2,000 million reais in the previous year to a final contribution of 2,660 million reais in the current year. Meanwhile, the second division, which encompasses the south, southeast and central west of Brazil, will experience an increase from 1.5 billion reais in 2023 to 2.05 billion this year.
Read also: The rural protest spreads across Europe with roadblocks and demands for reforms
The focus of these investments aligns with the Lula government's strategy, which seeks to reduce transportation costs and increase Brazil's competitiveness in grain production. This 30% increase in the allocation of public resources for road improvements seeks to promote the development and logistical efficiency of the country, the Government explained.
The 34% increase in investment in Brazil seeks to boost agricultural production and strengthen competitiveness, being essential for the efficient transportation of grains and agro-industrial products. (Photo: NA)
Finally, Transport Minister Renan Filho argued that the spending limit imposed in Brazil during Michel Temer's government made the country the country that invested the least among all relevant economies. The restriction on public investment had a negative impact on infrastructure, and although “it is currently being improved, the liabilities accumulated in recent years are still being recovered.”
Created in 2016, the spending ceiling limited the increase in public spending to changes in inflation. Last year, this mechanism was replaced by the new fiscal framework, which adjusts spending according to government income and allows spending to be increased in the event of an increase in income.