December 14, 2010

 

Brazil to hit new record 2010 agricultural exports

 

 

Brazil's agricultural exports will reach a new record level in 2010, regardless of a stubbornly strong currency pushing up export costs, due to consistent rise in farm output, the agriculture minister said Monday (Dec 13).

 

Wagner Rossi has been reappointed head of agriculture in the incoming government to be headed by President-elect Dilma Rousseff who has asked him to reorganise the ministry to help it keep the pace of the rapid growth of Brazilian farming.

 

"We are going to work with the aim of producing a lot more food, protein both animal and vegetable for the world, mindful of the environment and sustainability," said Rossi.

 

The world's leading exporter of soy, chicken and beef, Brazil should earn more than US$75 billion in 2010 from farm exports, Wagner Rossi said, helped by higher commodities prices.

 

That would be about 18% more than 2008's record US$71.8 billion, when Brazil's currency was similarly strong.

 

With ample spare agricultural land, Brazil sees itself shouldering a growing share of the burden in feeding an expanding world population in the coming years. Its top trading partner is now fast-growing China, its biggest buyer of soy.

 

Outlining development strategies, Rossi said his team would explore other ways to protect growers against adverse price movements, such as hybrid insurance policies that also cover against price falls as well as crop damage or failure.

 

He said more resources could be shifted to increasing subsidies paid toward growers' insurance premiums and away from a system of minimum price guarantees if this proved more efficient.

 

"We will study if it's possible and whether it will give results. It's a question of seeing where the resources would be best applied," Rossi said.

 

Crop insurance has expanded rapidly from a small base in the last five years since the launch of the subsidy.

 

Rossi said he would also seek to talk with his Argentinean counterpart about the idea of prohibiting wheat imports from its neighbour, its top supplier of the cereal, during the Brazilian wheat harvest period, to support to local growers.

 

Brazil grows 4-6 million tonnes of wheat annually but most is better suited to cakes than bread. That means it usually has to import a similar amount from Argentina, Uruguay and Paraguay to meet demand from its population of 190 million.

 

"We want Argentina to be our supplier like it has always been but it needs to come in at the right time and not compete with our sector. We want (Argentine wheat) to enter the country only during our inter-harvest," Rossi said.