Mar 24, 2010
Sugarcane Expansion In Brazil Occupies Mostly Pastureland
Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.
The question is often asked that if Brazilian farmers continue to expand their sugarcane production will that take away land form other row crops. On a nationwide basis, the answer to that question is basically no because the displaced row crops will be grown in other locations of Brazil. Even on a smaller regional basis, sugarcane production is displacing more pastureland than row crop acreage.
Take for example what has happened in the northern part of the state of Sao Paulo near the town of Ribeirao Preto, which is near the heart of Sao Paulo's sugarcane production. The state of Sao Paulo is responsible for over 60% of Brazil's sugarcane production and the production of sugarcane has been expanding rapidly in the state. According to the State Institute of Agricultural Economics, over the last 13 years, the sugarcane acreage in the region expanded 15% while the acreage of other crops declined 93%. That decrease of 93% looks significant until you take a closer look at the numbers.
In 1995, sugarcane production occupied 328,600 hectares in the region of Ribeirao Preto. That number increased to 377,600 in 2008, or an increase of 49,000 hectares, but the majority of the increased sugarcane production came from the conversion of pastures into sugarcane. In 1995, the region had 125,000 hectares of pastures, which declined to 87,000 in 2008 or a reduction of 38,000 hectares. In other words, 77% of the increase in sugarcane production came from the conversion of pastures.
The increase in sugarcane production did replace some row crop acreage, but it was relatively small to begin with compared to the amount of pastures in the region. The acreage of soybeans and peanuts declined 79% during the same period, but the acreage of these two crops was only 37,000 hectares for both crops combined. The acreage of permanent tree crops such as oranges, coffee, and mangos also declined, but only by 6.5%.
For local landowners, sugarcane production offers a much better economic return than virtually any other crop, especially when they consider that the sugar mill will do virtually everything to produce sugarcane such as planting, harvesting, and transporting the cane to the mill. Some of these well-to-do ranchers in Sao Paulo, who now rent their land to the sugar mill, have moved their cattle operations to the Amazon Region. In fact, the vast majority of deforestation in the Amazon Region is to clear land for cattle ranching and not to grow row crops.