March 24, 2011
 

Brazil to target 190 million tonnes of grain crop 

According to Brazil's agriculture minister, Wagner Rossi, Brazil has 120 million hectares of degraded land that could be changed to agriculture and the expansion will allow Brazil to raise grain yields by more than a quarter to 190 million tonnes/year in the next 10 years.

Grain production in Brazil over the past two decades has risen by 150% while the planted land area has grown only 25%. Many of these productivity gains have been because of local innovations in technology and farming practices but they are also in part due to higher foreign investment.

Brazil's total exports in agribusiness have increased by an average of 14% a year over the past 10 years to US$76.4 billion, with growth this year predicted at 10%, according to Rossi.

However, not everyone acknowledged the government's figures as correct, especially with regards to the land available for farming.

An analyst said the amount of additional degraded land that could be successfully used to cultivate crops in Brazil is probably closer to 20 million hectares. This would require some deforestation of Brazil's cerrado savannah forests. Although less widely known than the Amazon, these also have rich ecosystems.

"My guess is that we have less than 20 million hectares of land available for cultivation but that is still enough to cover what the world will need in the next decade," he said. Given this potential growth, overseas interest in Brazilian agriculture is not surprising.

A study commissioned by the Organisation for Economic Co-operation and Development last year approximated worldwide private sector investment in agriculture would reach US$14 billion in 2010 and could triple over the next five years.

Analysts said much of that amount was on course for Brazil until the foreign ownership constraints were introduced last year, which in effect limited land ownership to 5,000 hectares by a company that is more than 50% foreign owned.