Brazilian Agriculture Development
In a Global Perspective
Milton Suzuki
Bayer CropScience
Development and Field Trial - Latin America
Nuffield International Contemporary Scholars Conference
New Zealand - March 2011
Content
1.
Latin America Agriculture Potential
2.
Brazilian Agriculture Overview
3.
Opportunities
4.
Challenges
Latin America: Agricultural Potential
Evolution of agriculture global demand and supply
drivers
Yield
main crops
in Latin as
America
[ton/ ha]
Latin of
American
production
percentage
of
global agriculture [in tons]
1960
2008
Global land available for agriculture
expansion
Tech improvement
Corn
Area
expansion 4.3
1.4
(~3x)
23%
Asia PacificNAFTA
Soybeans Europe/
ME
Index
Demand
Yield
Acreage
14%
Wheat
1.1
17%
19%
LatAm
2.8
(~2.5x)
15%
Africa
1.1
2.7
(~2.5x)
1.8
4.8
(~2.5x)
49
80
(~1.5x)
Rice
Sugarcane
Source: FAO, USDA, Goldman Sachs Commodities Research, FAPRI, Syngenta
21%
People
Brazil’s profile in a nutshell
 Population (2010 est.): 201 million - annual growth rate: 1.17%.
 Ethnic groups: African, Portuguese, Italian, German, Spanish, Japanese and Indigenous peoples,
 Religion: Roman Catholic (74%).
 Language: Portuguese.
 Education: Literacy--88% of adult population.
 Health: Infant mortality rate--21.86/1,000.
 Life expectancy--72.6 years in 2010.
 Work force (2009 est.): 101.7 million.
Geography
 Area: 8.514.204,86 Km² slightly smaller than the U.S.
 Cities: Capital--Brasilia (pop. 2.5 million).
 Other cities--São Paulo (10.9 million), Rio de
Janeiro (6.1 million), Belo Horizonte (2.4 million),
 Terrain: Dense forests in northern regions
including Amazon Basin; semiarid along northeast
coast; mountains, hills, and rolling plains in the
southwest, including Mato Grosso; Midwestern
savannahs; the world's largest wetland area; and
coastal lowland.
 Climate: Mostly tropical or semitropical
with temperate zone in the south.
SOURCE: IBGE
Brazil: a country with continental dimension
Source: J.L.Coelho, John Deere, 2001
Brazil: Estimated Land
(millions of hectare)
Area: 8.514.204,86 Km²
 Amazon Forest
 Legal Forest Reserves
 Cities, Lakes, River and Wetland
 Other uses
 Reforestation
Sub-total
 Pasture (livestock)
 Annual Crops
 Permanent Crops
 Available Area for Agribusiness
Sub-total
Total
350
55
20
54
5
484
215
47
15
90
367
851
Natural resources:
 Iron ore, manganese, bauxite, nickel, uranium, gemstones, oil, wood, and aluminum.
 Brazil has 14% of the world's renewable fresh water.
SOURCE: CropLife Latin America 2010
Brazil: Agriculture outlook
 Agriculture is a major sector of the Brazilian economy, and is key for economic growth
and foreign exchange.
Agriculture accounts for about 5.5% of GDP (25% when including agribusiness) and
36% of Brazilian exports.
Brazil enjoyed a positive agricultural trade balance of US$55 billion in 2009.
Brazil is the world's largest producer of sugarcane, coffee, tropical fruits, frozen
concentrated orange juice (FCOJ), and has the world's largest commercial cattle herd
(50% larger than that of the U.S.) at 170 million head.
Brazil is also an important producer of soybeans (second to the United States), corn,
cotton, cocoa, tobacco, and forest products.
The remainder of agricultural output is in the livestock sector, mainly the production of
beef and poultry (second to the United States), pork, milk, and seafood.
SOURCE: state.gov.
Brazilian Agribusiness – Production and Exportation
World wide ranking - 2009
Products
Sugar
Coffee
Orange Juice
Soybean
Cattle Beef
Ethanol
Poultry
Corn
Swine
Sources:
Production Exportation
Market
Exportation
amount
US$ Mio
Brazil: The Opportunity, Still a Challenge
?
Brazilian imbalanced distribution of GDP per state - 2009
Agriculture (5.6% of GDP):
Products ->coffee, soybeans, sugarcane, cocoa, rice,
livestock, corn, orange, cotton, wheat, and tobacco.
Industry (27.8% of GDP): Types--steel, commercial aircraft,
chemicals, petrochemicals, footwear, machinery, motors,
vehicles, auto parts, consumer durables, cement, and lumber.
Services (66.6% of GDP): Types--mail, telecommunications,
banking, energy, commerce, and computing.
Trade: Trade balance (2009) US$ 25.3 billion surplus.
Exports-> US$153.0 billion.
Major markets -> China 13.20%, United States 10.20%, Argentina 8.36%.
Imports-> US$127.7 billion.
Major suppliers-> United States 15.69%, China 12.46%,
and Argentina 8.84%.
Brazilian states split according
to 2009’ Gross Domestic Product. In Mio US$:
██ + 280.000
██ + 65.000
██ + 35.000
██ + 5.500
██ + 3.000
██ up to 3.000
Opportunities: Brazil’s Production Diversity
1998
2008
Soybean Complex;
25,0%
Others; 9,8%
Soybean Complex;
22,0%
Others; 11,2%
Fruits Juices; 3,0%
Fruits Juices; 6,1%
Cereals and
Flour; 3,1%
Tobacco; 3,8%
Cereals and
Flour; 0,2%
Tobacco; 7,2%
Meat; 7,5%
Leather and
Products; 8,8%
Leather and
Products; 4,4%
Coffee; 6,6%
Coffee; 12,1%
Forest
Products; 15,6%
Sugar and Ethanol;
9,2%
US$ 21,5 bi
Meat; 20,3%
Sugar and Ethanol;
11,0%
Forest Products; 13,0%
US$ 71,8 bi
Opportunities: Brazil’s Agro-exports Diversity
1998
Others; 4,1%
Others; 5,3%
Mercosur; 8,6%
E.U - 27; 41,1%
Aladi (-Mercosur);
3,6%
2008
E.U - 27; 33,1%
Mercosur; 2,8%
Aladi (-Mercosur);
6,0%
Africa (-Mid. East);
4,7%
Africa (-Mid. East);
6,7%
Eastern Europe;
3,2%
Eastern Europe;
6,9%
Mid. East; 5,9%
Mid. East; 7,1%
USA; 14,9%
China; 2,7% Asia (-China, Mid.
East); 11,2%
194 destinations
E.U. + USA = 56%
USA; 8,7%
China; 11,0%
Asia (-China, Mid.
East); 12,4%
211 destinations
E.U. + USA = 42%
Opportunities: Ethanol production / electricity co-generation
Generator
Electricity
Sugar cane harvest
Sugar mill (industrial plant)
Steamer
Sugar
Sugar cane milled bagasse
Flex fuel cars
Opportunities: Bio diesel
Issues and bottle necks
SOURCE: CropLife Latin America 2010
LOGISTICS
Transportation Genre (%)
13
4
25
58
Roadway
Railway
Source: Brazilian Infrastructure Yearbook – Exame Magazine (2006/07).
Waterway
Airway
Losing time and money on the harbor line…
Challenges: Logistics
Mess at the harbor…
Spending days on bad paved roads – delays and loses…
Challenges: Logistics
Santos’ harbor (BR) occupies position #41 world wide in container movement
Challenges: Logistics
Folha de São Paulo says: Worse logistic takes out US$3,9 billion from agribusiness
Challenges: Exchange Rate
SOURCE: BACEN
In sum, yes Brazil is not only...
Carnival party
Soccer/football
Amazon forest
It also is...
food
feed
fuel
Latin America has the potential to be a global efficient supplier
of food, fiber, feed and renewable energies.
Investment &
enablement of
technology
Investment in
human capital &
infrastructure
Business-oriented
policies
2007
2008
Thank you very much for your attention !
milton.suzuki@bayer.com
2009
2010