December 17, 2010

4% of Brazilian Properties Produce 70% of Total Food Production

Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.

A recent study released by the Agricultural Confederation of Brazil (CAN) revealed that just 4% of the rural properties in Brazil are responsible for 70% of the total food production in Brazil. This means that more than four million rural properties in the country produce very little or nothing at all. The vast majority of these lower-producing properties are subsistence farmers especially in northeastern Brazil where the property owners barley produce enough to feed their own families.

To reverse this trend of concentration in agriculture, the president of CAN, Katia Abreu who is a senator from the state of Tocantins and a critic of President Elect Rousseff, feels that more emphasis must be placed on sustained agricultural prices and more available credit for small producers. With less credit from the private sector available for small producers, she feels that the federal government needs to do much more in the way of providing credit for small family farmers.

For the most productive properties in Brazil, 2010 was a year of recuperation after the financial crisis of 2008. Commodity prices have strengthened and as a result, agricultural income in Brazil is expected to increase 7% in 2010. CAN estimates that agricultural exports in 2010 will surpass US$ 76 billion and that the agricultural sector will continue to expand in 2011. The principal basis of their optimism is the fact that the Chinese economy is expected to expand by 8% and China is the main buyer of Brazilian agricultural products.