Brazil sugar sector poised for ‘wave of mergers’

July 21, 2014

Agrimoney, 7/21/2014

A leading sugar banker cautioned over this year’s drought in Brazil’s Centre South region hitting cane crops in 2015-16 too as he forecast a wave of mergers among mills, their financial prospects further undermined by the crop downturn.

Alexandre Figliolino, director at Banco Itau BBA, said that the cane harvest in Brazil’s Centre South, responsible for 90% of the domestic crop, could fall to 550m tonnes this season, following the drought which hit the region early in the year.

The forecast, down from 596m tonnes in 2013-14, compares with an estimate of 560m tonnes from Datagro and 575m tonnes from Kingsman, although Canaplan has a forecast of 540m tonnes.

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Kenya: Brazil’s cultural similarities enhance trade

August 5, 2013

Bernard Ayieko – All Africa, 08/05/2013

The Second Brazil in Eastern Africa Expo which was held in Nairobi from July 24 to July 25 underscored the need to build business relations between investors of the two regions.

The theme of the expo, ‘Bridging the Missing Link’, indicated that the existing trade links could be strengthened. What better way to do this than to hold a multi-sectoral expo showcasing the evolution of Brazilian technology in the areas of agricultural machinery and implements, industrial equipment, renewable energy, building and consumer goods.

More than 60 Brazilian companies and institutions exhibited during the three-day event.

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Agriculture and food security: Brazil’s chance to assume leadership among the BRICS?

June 11, 2013

Oliver Stuenkel – Post-Western World, 06/09/2013

The stark differences between Brazil’s and India’s agricultural productivity and their differing positions during trade negotiations in the past years are an often used argument of why South-South cooperation will always be an elusive dream. And indeed, India has often been accused of being a nay-sayer in the realm of agriculture, even by its fellow emerging powers.

It may then come as a surprise that agriculture and food security are among the first topics that emerged when the BRIC grouping began to discuss ways to cooperate. In fact, during the first BRIC Leaders Summit in 2009 in Yekaterinburg, a separate declaration on food security was issued, underlining the importance of the matter.

In the document, the BRICs professed to be “committed to opposing protectionism, establishing a just and reasonable international trade regime for agricultural products, and giving farmers from developing countries incentives to engage in agricultural production.” The 2-page document argues that “the developed and developing countries should address the food security issue according to the principle of common but differentiated responsibility”, a concept that would become a trademark of future BRICS declarations, particularly in the field climate change. Finally, the BRICs signaled their interest in cooperating by “sharing the best practices of operating successful public distribution programmes.”

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Exclusive – Brazil’s Rousseff sides with farmers in Indian land fight

May 15, 2013

Brian Winters, Caroline Stauffer – Reuters, 05/14/2013

Brazilian President Dilma Rousseff has ordered her government to stop confiscating farmland to create new Indian reservations, government officials say, a policy reversal with major implications for one of the world’s top agricultural producers.

Brazil has in recent decades set aside about 13 percent of its territory for indigenous tribes. Vast additional areas, including prime territory for the production of soy, beef, sugar and other commodities, are under consideration for possible transfer.

That policy has been hailed as one of the world’s most progressive but had caused mounting clashes in recent months as thousands of farmers were evicted from land they had been cultivating, in some cases for decades.

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The queen of the cowboys

April 29, 2013

Mac Margolis – Newsweek, 04/29/2013

The Brazilian cerrado is no place for a tenderfoot. In the dry season in Aliança, the township just below the Amazon basin where Kátia Abreu farms, a withering sun leaves the land parched and choked in dust. A few months later, from November to May, downpours lash the dirt into a moonscape of potholes and mud. Many planters have stumbled here, and their tumbledown plots are strewn like headstones along the savanna. But for those who endure, fortunes can bloom. Once this sparsely peopled flatland was carpeted by niggardly scrub, home to jaguars and braces of toucans. Now corn, cotton, and soybeans grow on plantations the size of American counties, and cowboys in Land Rovers mind herds of bleached Nelore beef cattle that stretch to the horizon. The cerrado is the Western Hemisphere’s newest agricultural frontier, and no one rides taller here than Abreu.

She is not the biggest landowner or even remotely the richest (that title belongs to Blairo Maggi, the agrimogul who is the world’s largest single producer of soybeans). But this 51-year-old rancher’s widow turned land baroness, then national lawmaker, has left her brand on this Latin American powerhouse, provoking admiration, praise, and fierce opposition in competing measures. Abreu and her two sons tend a formidable stretch of the cerrado—three farms of soybeans and sorghum and 12,000 head of cattle in Tocantins, Brazil’s newest state and part of the planet’s emerging breadbasket. “It’s hard to say where she doesn’t have land,” said one government employee in Palmas, the state capital, quickly asking not to be named.

Abreu is no pampered heiress. Since 1987, when a plane crash killed her husband and nearly broke her, she has had to fend for herself. “I knew nothing about ranching,” she said. “But I am stubborn and don’t give up.” Pride and fear of failure did the rest. She cropped her hair to look less girlish and took care never to cry in front of the farmhands, sobbing only to herself at night. Ever since, the reluctant rancher has managed to command respect, authority, and a loyal following in the baritone world of cattle, crops, and rural rainmakers.

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In Brazil, a landholder who speaks for agribusiness

December 17, 2012

Juan Forero – The Washington Post, 12/17/2012

A landholder and power broker in the country’s capital, Katia Abreu has heard all the warnings about ranches and soybean farms carving up Brazilian forests.

But as she rides a chestnut mare across fields of sorghum and corn — her 12,355-acre spread here in the soft hills of north-central Brazil — Abreu insists Brazilian farmers should be commended, not demonized. Big Agro has transformed this country into a breadbasket to the world, she said, one that’s poised to feed billions.

“We are not ashamed of anything,” Abreu said. “What’s important is that Brazil increase production.”

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Brazil to produce more sugar, less ethanol

December 13, 2012

AFP, 12/13/2012

Brazil’s sugarcane production will rise 6.5 percent this year but ethanol output will slump 5.22 percent as a greater focus is put on exporting sugar, the agriculture ministry said Wednesday.

Data from the national crop-forecasting agency Conab said sugarcane production in the world’s leading producer could reach 595.13 million tons during the 2012-2013 harvest, up from 560.36 million in 2011-2012.

“Improved weather conditions from the second half of the year in the main producing areas, such as the central-south, makes possible an increased volume of sugarcane for the milling season,” an official report said.

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Brazil Inflation Boosted by Farm Price Shock, Hamilton Says

August 3, 2012

Raymond Colitt and Matthew Malinowski – Bloomberg, 8/3/2012

Brazil’s inflation was quickened by a temporary shock from agriculture price increases and will slow later this year, said Carlos Hamilton, the central bank’s director for economic policy.

Consumer prices rose faster than analysts expected in the month through mid-July, as adverse weather conditions in Brazil and abroad pushed up food prices 0.88 percent from the previous month. Brazil’s inflation will converge to the central bank’s target during the second half of the year as the climatic effects pass, Hamilton said to reporters in Salvador.

“The shock to supply originated in climatic changes,” Hamilton told reporters in Salvador while commenting on the central’s bank’s quarterly regional report, released today. “We have to wait to see its duration and intensity. Supply shocks are understood to be temporary.”

The bank, which has cut the benchmark rate by 450 basis points in the past year to a record 8 percent, targets inflation of 4.5 percent plus or minus two percentage points. Prices in the month through mid-July rose 5.24 percent from the year before.

In the Spotlight: How will commitments to the environment affect U.S.-Brazilian relations?

June 27, 2012

Compiled by Elizabeth Sweitzer – Brazil Institute, 6/27/2012

Photo credit: Sam Beebe, Ecotrust

The outcome of last week’s Rio+20 Conference on Sustainable Development foreshadowed the need for continued international cooperation concerning the environment, while also pointing to the economic implications of sustainable development. While the Conference’s outcome was met with mixed feelings, U.S. Secretary of State Hillary Clinton offered optimistic remarks on various international achievements while signaling to the U.S.’s most pertinent environmental initiatives. In her speech on June 22,  Clinton urged nations to develop partnerships with private-sector industries, announced various U.S. initiatives to fund sustainable projects in developing nations as well as Brazil, and addressed promotion of women’s rights as integral aspects of sustainable development.  Importantly for U.S.-Brazil relations, the speech also elucidated the nations’ joint commitments to urban sustainability projects and forest conservation.

Despite the U.S.’s assurance that their efforts will curb deforestation, the status of the Forest Code bill remains contentious in Brazil. The original Forest Code which dates back to 1965 is admittedly a very controversial document; it both sets protections on the forest while giving agribusiness sectors access to logging in order to farm. As a result, Brazil faced the blame for erosion of the world’s rainforest in some of its most vulnerable regions, including riverbanks and areas of incredible biodiversity. It was precisely these incidences which prompted the most recent revision of the forest code in 2012. Although President Dilma Rousseff vetoed parts of the proposed bill, many environmental activists still argue that the bill needs to be vetoed in its entirety.

The twelve most controversial sections, including a decree that would give amnesty to illegal deforestation prior to 2008, were amongst those sections vetoed. Ruralistas, farmers who grow on cleared land in the Amazon, argue that they need to Forest Code to maintain an income and support Brazil’s booming agribusiness sector. Various economists also suggest that keeping the bill will be necessary in order to avoid a harsh rise in food prices and economic turmoil. Other environmental activists contend that enough arid land already exists, and that Brazil could gain fiscal benefits from the international carbon market through forest preservation, especially considering the fact the rainforest absorbs some 2 billion metric tons of carbon dioxide each year.

The government now has until September 25, 2012 to revise the forest code. Nevertheless, this debate remains entrenched in whether or not President Rousseff’s congressional support will be erased in the event she does ultimately veto the Forest Code. While she currently enjoys popular support for keeping Brazilian unemployment at a historic low, her efforts to promote social equality could be tested by the fact that ruralistas and the entire Brazilian agribusiness sector will be directly affected by a veto.

Even in the event the Forest Code is ultimately vetoed, Brazil faces another indirect factor. If the U.S.’s economic position changes, increased deforestation may occur due to renewed demand for commodities from the Amazon. Indeed, while the U.S. has recently experienced a weakened demand for corn and ethanol fuel from Brazil, Obama has been increasingly eyeing Brazil’s oil resources whilst Brazil cannot yet confirm its ability to supply the amount of oil the U.S. would need.

Will Brazil import U.S. soybeans?

May 4, 2012, 05/04/2012

It’s been over a decade since Brazil, the world’s #2 soybean producer, has had to import the country’s “King” commodity from the United States. That streak could end as early as this year because of South America’s worsening crop shortages.

Due to a drought in the first months of the year, southern farmers in Brazil rushed to sell their soybean stock to China to compensate for their losses by taking advantage of excellent international prices.

Nearly 80% of the country’s soybean crop has already been exported this season, according to independent estimates. The percentage is 20% higher than the same month of 2011. The Brazilian government denies any type of “rationing,” but says that in the future – perhaps next year – the nation could import soybeans from other sources, including the U.S.

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