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February 25, 2016

Brazil Could Double Soybean Production in Cerrado Area

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

As farmers in Brazil harvest another record large soybean crop, the question is often asked if they could continue expanding their row crop production in the years ahead. The answer to that question is yes, provided that there are financial incentives to do so. It's not a question of if they will expand soybean production, but rather how much they will expand it because there is ample additional land available in Brazil for agricultural expansion

A study recently released by Agrosatelite entitled "Geospacial Analysis of Annual Crop Dynamics in the Cerrado Biome" looked at the factors that have led to agricultural expansion in the cerrado regions (savanna) of central Brazil and what the potential expansion might be in the future. The study was conducted in cooperation with the Gordon and Betty Moore Foundation from the United States.

The study concluded that the cerrado biome in Brazil encompasses 204 million hectares (503 million acres) of which, 103 million hectares is still covered by native vegetation (50.5%). The amount of cerrado land that is highly suited for grain and food production is estimated at 25.36 million hectares (62.6 million acres) with the majority of those hectares currently in pastures, sugarcane, or eucalyptus reforestation. Most of this hectares are located in the states of Mato Grosso, Minas Gerais, Goias, Mato Grosso do Sul, Sao Paulo, Parana, and Rondonia. The cerrado biome is the second largest in Brazil after the Amazon rainforest and it covers an area the size of the United Kingdom or six times larger than Holland.

Agrosatelite examined 2,500 satellite photos taken from 2000 to 2014 with the intension of identifying where the recent expansion of soybean, corn and cotton production has occurred in Brazil. From 2000 to 2014, 5.6 million hectares of pastures in the cerrado region were converted to row crop production with majority dedicated to soybean production.

Knowing how many hectares that are still available for row crop expansion in the cerrado region of Brazil is important information for politicians, preservationists, and environmentalists as they formulate agricultural policy. Agricultural expansion in the Amazon region has been significantly restricted, so most new production will occur in the cerrado areas.

According to the director of Agrosatelite, Bernardo Rudorff, it would be possible to double the soybean production in the cerrado region by converting mainly pastures to soybean production. Soybeans occupy only 8% of the cerrado areas of Brazil, but the cerrado region was responsible for 51.9% of Brazil's total soybean production in 2013/14. Since most of Brazil's corn is now produced as a second crop following soybeans, the corn acreage in Brazil could accompany the expansion of the soybean acreage.

The Brazilian Association of Vegetable Oil industries (Abiove) which represents soybean processors hailed the study as evidence that soybean production can expand in Brazil without any additional deforestation. In fact, both the government and environmentalists encourage the greater use of existing land as the sustainable way of increasing food production.