| SAO PAULO, April 5
SAO PAULO, April 5 Brazil's economy probably
came out of recession in the first quarter almost exclusively
thanks to a record soy harvest, economists said on Wednesday,
forecasting a broader recovery to start later in the year.
Brazil's agricultural output, which accounts for only about
5 percent of the country's economy, may have risen as much as 8
percent in the first quarter from the last three months of 2016,
according to private estimates, while industrial and services
activity probably remained stagnant.
The economy as a whole grew by between 0.1 and 0.3 percent
in the first quarter as a result, according to banks and
research firms, ending a two-year-long recession that has been
the deepest in the country's history.
"If it wasn't for that contribution (from agriculture), we
would likely be forecasting another fall in gross domestic
product," said Rodolfo Margato, an economist with Santander
Brasil, in São Paulo.
Agricultural output usually rises in the first few months of
every year, but 2017 is projected to be a particularly good one
thanks in part to expectations of a record soy crop. Brazil is
the world's largest soy beans exporter.
Brazil is also expected to be a relevant player in the
global corn market this year as output recovers from a strong
dry spell in 2016.
"We're projecting an increase of 6.8 percent in agricultural
output but we don't rule out an even higher figure," said Silvia
Matos, a researcher at the Getúlio Vargas Foundation think-tank.
Brazil's economy shrank 3.6 percent in 2016 and is expected
to grow about 0.5 percent this year, according to a weekly
survey of economists by the central bank. Agricultural output is
forecast to grow 5.8 percent in 2017 from 2016, while industrial
GDP is expected to rise 0.8 percent and services are projected
to fall 0.1 percent, the survey showed.
Aside from agriculture, industrial output is expected to
pick up speed in coming months, before services activity,
economists said. Service providers, which account for about 70
percent of Brazil's economic output, have struggled with
($1 = 3.1085 reais)
(Writing by Silvio Cascione; Editing by Sandra Maler)