COUNTRY CORNER
Expansion of agricultural frontier in Brazil is a familiar story
By Steven Fairchild
Brazilian agriculture weighs heavy on the U.S. producer. That much was evident at this year’s University of Missouri Breimyer Seminar. The topic was “Growth in Brazilian Agriculture—Implications for the U.S.” Judging by attendance and the rapt attention paid by the audience, the implications are serious.
Here was the Food and Agriculture Policy Institute’s (FAPRI) Pat Westhoff explaining that in Brazil only 30 percent of the nation’s 2.1 billion acres were in use by agriculture. There would be expansion in soybean production, Westhoff said. And he showed FAPRI charts that predicted Brazilian exports at a steady climb. He explained lower fixed costs due to cheap Brazilian land, and that the conditions in Brazil are right for meat and poultry growth.
Then there was Phil Warnken of AgBrazil explaining why his company has focused on the Brazilian state of Bahia. Based in Columbia, Mo., AgBrazil assists U.S. farmers in locating farmland in Brazil. Bahia’s deep soil and plant friendly climate make it a garden spot for crops such as irrigated coffee, papaya, edible beans, table grapes and peanuts. The land is also generous to crops that hit a little closer to home such as cotton, rice and soybeans. Warnken said with lower fixed costs, farming margins in Bahia are better than in the U.S.—so much better that they are worthy of venture capital. In some cotton friendly areas, he said, the net profit could pay for the land in just 2 or 3 years.
It’s at that point that we should begin to feel the familiarity. We studied this topic in fifth grade. It’s the Western Expansion, gone south—literally. Back in the office, I Googled up a site that had promotional posters from the 1850s. Same language. A Burlington & Missouri Rail Company poster pushing settlers toward the Big Blue between Camden and Crete, Nebraska, claimed: “[Farm] products will pay for land and improvements.”
Midwest farmers aren’t many generations from the pioneers who settled this land. We still hear stories today about how great-grandfathers broke the prairie with a team and plow. A few generations later, the mood still strikes at some hearts.
That’s why another of the meeting’s presenters has been in Brazil for about a year. Brian Willott, a Missouri native and FAPRI alumni, talked about why he has chosen to farm in Brazil. He said there are really two questions to be answered. First, why farm? That, he said, is an addiction, and one that finally caught up with him. Second, why farm in Brazil? Willott said that being a number cruncher in FAPRI for better than a decade made him cynical about return on investment for farming enterprises. He chooses to farm in Brazil because, even with the inherent risks of farming compounded by a foreign government and language barriers, he sees economic promise.
Willott is part of a consortium of farmers who have pooled resources to purchase land in Brazil. I suspect we’ll see more in the future. Maybe it’s the call of the frontier spirit. Maybe it’s old fashioned crop diversification tempered with diverse geography. Or maybe it’s a good read of the writing on the wall.
Willott, who focuses on crops other than soybeans, sounded wearied by the suggestion that by farming in Brazil he has committed some sort of agricultural treason. Still, that exposes a new wrinkle in agricultural competition. When your neighbor, with the same love for farming as you, feeds his addiction by capturing some frontier in Brazil, there is a simple question that arises. It’s the same question that settled farmers had to ask about those who pushed west a century and a half ago. Do you want those who chase the frontier to succeed or fail?
Steve Fairchild, editor
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