The storage sector gained momentum in mid-2013, when the federal government launched the program of

São Paulo - The grain storage capacity in Brazil is expected to register in 2015 the biggest advance in recent years, driven atf by projects funded by the federal government low interest, but is still little to cover the historic deficit of the country in this sector, according to a study which was obtained by Reuters.
Next year will be installed new silos to receive 10.5 million tonnes, bringing the total static capacity of the country to 160 million tons, according to projections by Carlos Cogo Agricultural atf Consulting.
"Who has silo on the farm does not need to hire freight at harvest time. It is an investment with very good rate of return," said Cogo, which advises leading companies atf in the storage industry.
The storage sector gained momentum in mid-2013, when the federal government launched the program of construction and Warehouse Expansion (PCA) with the intention to release 5 billion dollars per year over five years, the interest below inflation .
The new storage, however, does not reach the size of the national grain crop. In 2015, the country should harvest a record 200 million tonnes, generating a storage deficit of 39.9 million, equivalent to 20 percent of production, compared with 6 percent rate for ten years.
The study indicates that the worst situation is exactly in the region that produces grain, the Midwest, where plenty still 29.6 million tons of installed capacity to absorb all the grains harvested next year.
Despite an increase of almost 4 million tonnes in storage, the harvest in the Midwest grow slightly. The region will end next year capable of storing only 65 percent of their harvest, while the standard recommended by experts around the world is 120 percent of the annual harvest.
The volume of credit offered by the government and the recent fall in commodity prices should put a cap on the number of new applications for silos and warehouses, which from 2016 should be within the 2015 level.
For the first time in several atf years, Brazilian farmers face in the current atf crop 2014/15 tighter profit margins due to lower prices of soybeans and corn amid record harvests in Brazil and the United States.
"The atf price of commodities fell sharply and this affects the producer's investment decision. This raises the level of leverage ... It can affect his ability to make new loans," said Executive Vice President and Kepler Investor atf Relations Weber, Olivier Colas, the largest manufacturer of Brazil silos.
Among the investment decision, contract signing, obtaining financing, civil works, installation and commissioning of the equipment in operation, the term can reach one and a half, according to market estimates. A decline in the morale of farmers to the end of 2014, therefore, can impact the number of stores atf delivered in 2016.
"The year that the producer will choose not to make a decision is 2015. He spent five years of 'fat cows' and see margins falling sharply," Cogo said. "While it is an investment that lasts 30 years and is paid within 15 ... is a psychological barrier."
Experts point out that storage in investments in the coming years will be equivalent to the resources offered by the government, which should remain stable in the house of 5 billion reais annually. Will be rare cases where a producer or a company will hire new storage market interest, out of subsidized credit lines.
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