Thursday, April 11, 2024

Brazilla vs Kong


If Brazilian ag was a creature, I picture it as Godzilla, emerging from the ocean, preparing to eclipse a nearby North American city, as seen in the movies. Maybe it's a friendly Godzilla, well-intentioned and not dangerous at all. But there’s no denying its scale and strength. And at this point we don’t even know how much is still hidden under the water. Each year, it’s still growing in production and exports, from 20-40%, depending the commodity.


Before I went to Brazil, I hadn’t spent a lot of time thinking about it. I was worried about the Amazon and knew that soybeans and beef were a big deal there and that was about it. None of that was misplaced but there’s a lot more to it, obviously. For scale, Brazil is roughly the same size as the contiguous US, or Australia with equally varied landscapes and growing conditions, although proximity to the equator means they can achieve two harvested crops per year, plus some grazing in between (following under-seeded corn to grass).  It wasn’t unusual to see a combine harvesting soybeans, followed closely by a corn planter. It was also common to see a crop in all its various stages within an hours drive. Soybeans being planted, harvested and at every growth stage in between. The lack of highly varied seasons makes for accelerated rotations that can do a whole lot more than us northern hemisphere folks limited by winter.



While Brazil has historically been through a roller coaster of export-driven markets from brazilwood to coffee to sugarcane to rubber, it’s been a roller coaster that has been steadily climbing up a hill with no great downfall anywhere in sight. Large scale agriculture there really only took off in the 1970s so it’s a relatively young country in the big ag world and it has taken some valuable lessons from those “developed” countries who are now trying to recover from decades of soil exploitation. The ground is rarely bare in Brazil, partly due to those two crops per year, but also because there is an acceptance that cover makes sense. They have put all their eggs in one particular grass basket which seems like a bit of a vulnerability but the Brachiaria variety of grass resists pests and grows well under Brazil’s conditions. It is sensitive to herbicides so requires lower doses in a no-till system and does well as fodder for cattle.  There is quite a robust network of researchers and extension agents for farmers at all scales and the trust and respect between the two seems very strong. 


The rules around deforestation are clear but enforcement may be spotty and it depends on who you talk to when it comes to the perception of fairness. The policy makers are clear on the rule being 20% of any private land holding must not be cut down, which is to say that 80% can be cleared.  Within the bounds of the Amazon, those numbers are reversed and it is 80% of any land holding must be maintained and not cut down. The governor claimed that penalties for breaking these rules were very severe, from large fines up to jail time.  But this also means that 20% of deforestation in the Amazon region is perfectly legal.  More than one farmer, when pressed about international pressures in regards to deforestation in Brazil said, “Bah, all the rest of you already cut your forests centuries ago, it’s our turn.”  One cannot help but be simultaneously dismayed and empathetic with this perspective. 


As a country that can grow a full sized hardwood tree for timber in 7 years, compared to our 45 years, can harvest two cash crops in one year and is still continuing to increase exports and yields year over year, Brazil could be the biggest ag-Godzilla the world has ever seen. But with great power comes great responsibility and to turn a blind eye to the crisis of the Amazon in favour of focusing on productivity, no matter how successful, is to ignorantly accept the “if I’m going down, you’re going down with me” adage, to detriment of us all. 


In a world convinced that it will be unable to feed itself soon (totally false but propped up by the “science” and the deep pockets of chemical and fertilizer companies), Brazil is doing its damnedest to fill the gaps and as it stands today, will continue to grow in leaps and bounds for years to come. By that measure, Brazil will soon reign supreme but by failing to recognize its very strong dependance on tenuous inputs and economies of scale that are exactly as efficient as they are vulnerable it will be very interesting to see what it looks like in a couple decades from now. Will Brazilla (see what I did there?) become the force that dwarfs King Kong (the other major producing and exporting countries)  or will they fall on their sword of currently-justified hubris? 


(Not Godzilla, just an ANACONDA that was in the same river I snorkelled in!! Glad I didn't see it while I was in there with it!!!)