World Grain - August 2010 - 22

COUNTRYFOCUS

Focus on Brazil
Agricultural giant expected to produce a
record soybean crop in 2010-11
by Chris Lyddon

Brazil is the B in BRIC, the acronym invented by Goldman Sachs
economist Jim O'Neill, who suggested Brazil, Russia, India and
China could become four of the most important global economies
by 2050. It's long been a giant in the world's agricultural economy,
and its guardianship of the Amazon rainforest makes it more important to world farming and the world's natural environment.
Brazil is the world's second largest producer of soybeans, second only to Argentina, and a massive exporter. The U.S. Department of Agriculture (USDA) has forecast a return to historical
record planted area at 23.3 million tonnes in 2010-11, which will
yield a record 67.5-million-tonne soybean crop. The attaché's estimate for 2009-10 production was 67.25 million tonnes.
"Increases resulted from favorable El Nino weather conditions, increased planted area, substitution from corn to soybeans
in southern Brazil and record yields in southern Brazil," the report said. "Average yields in Brazil continue to improve with
rapid adoption in the latest production and machine technology
and development of better soil management techniques."
However, there are problems. The attaché points out that Brazil's tropical climate demands improved pest and disease management as producers balance increased costs with the need to
increase productivity. "Lack of crop rotation practices in the
North and Northeast regions has amplified
disease and pest occurrences such as nematode, white fly and caterpillar," the report
said. "From the Center-West to southern BraBRAZIL
zil, soybean rust appears manageable, having
less affect on yields, but requiring significant
investments in agrochemical applications."
Brazil has to import fertilizer, the attaché
said, putting dependence on imports at 74%
for nitrogen, 49% for phosphorus and 92%
for potassium. "In 2009-10, the cost of fertilizer was estimated at 12 sacks (60 kg) of soybeans per
hectare, the attaché said. "For 2010-11, fertilizer usage
is expected to decrease slightly as prices for fertilizer
have increased over 20 percent in the past month and
continue to rise."
FRENCH GUIANA

VENEZUELA
COLUMBIA

PERU
BOLIVIA

PA
R

CHILE

AG
UA
Y

ARGENTINA

GRAIN CROPS
The International Grains Council (IGC) put Brazil's total grain
crop in 2010 at 60.7 million tonnes, compared with 61.1 mil22

Key Facts
Capital: Brasilia
Population: 201,103,330
Religions: Roman Catholic (nominal) 73.6%, Protestant
15.4%, Spiritualist 1.3%, Bantu/voodoo 0.3%, other 1.8%,
unspecified 0.2%, none 7.4% (2000 census).
Location: Eastern South America, bordering the Atlantic
Ocean.
Government: Federal republic. Chief of state and head of
government: President Luiz Inacio Lula da Silva (since Jan.
1, 2003).
Economy: Characterized by large and well-developed agricultural, mining, manufacturing and service sectors, Brazil's
economy outweighs that of all other South American countries, and Brazil is expanding its presence in world markets.
Since 2003, Brazil has steadily improved macroeconomic
stability, building up foreign reserves, reducing its debt profile by shifting its debt burden toward real denominated and
domestically held instruments, adhering to an inflation target, and committing to fiscal responsibility. In 2008, Brazil
became a net external creditor, and two ratings agencies
awarded investment grade status to its debt. After record
growth in 2007 and 2008, the onset of the global financial
crisis hit Brazil in September 2008. Brazil's currency and its
stock market - Bovespa - saw large swings as foreign investors pulled resources out of Brazil. Brazil experienced two
quarters of recession, as global demand for Brazil's commodity-based exports dwindled and external credit dried up.
However, Brazil was one of the first emerging markets to
begin a recovery. Consumer and investor confidence revived
and GDP growth returned to positive in the second quarter,
2009. The Central Bank expects growth of 5% in 2010.
GDP per capita: $10,200 (2009 est.); inflation: 4.2%
(2009 est.); unemployment 8.1% (2009 est.)
Currency: Reals (BRL); 1.784 reals equal 1 U.S. dollar (July
16, 2010)
Exports: $153 billion (2009 est.): transport equipment, iron
ore, soybeans, footwear, coffee, autos.
Imports: $127.7 billion (2009 est.): machinery, electrical
and transport equipment, chemical products, oil, automotive
parts, electronics.
Major crops/agricultural products: Coffee, soybeans,
wheat, rice, corn, sugarcane, cocoa, citrus; beef.
Agriculture: 6.1% of GDP and 20% of the labor force.
Internet: Code. .br; 15.929 million (2009) hosts and
64.948 million (2008) users.
Source: The CIA World Factbook

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