Posted on 07/20/2003 12:15:30 PM PDT by Destro
U.S. farmers see Brazil as lucrative investment
"U.S. Farmers Put Down Roots in Brazilian Soil," Simon Romero. New York Times (www.nytimes.com), December 1, 2002.
"Iowans bid to broaden farming prospects in Brazil," Jerry Perkins. Des Moines Register (www.desmoinesregister.com), November 11, 2002.
"No Bad Soils," Marcia Zarley Taylor. Top Producer (www.agweb.com), November 2002.
An Iowa farmer has purchased more than 7,000 acres in Brazil as a way to bring his son into the family farm operation. Another may sell more than 1,000 acres of Iowa farmland to buy 10,000 acres in Brazil. Investment pools are being set up for farmers who see opportunity in Brazil, but who don't have enough capital to invest on their own. More than 200 American farmers, including a Mennonite colony, are now farming in Brazil.
"Brazil is where we're going to expand Iowa," said David Kruse, an Iowa farmer and commodity broker who expects a 20 percent annual return on investment.
Crop-ready land in Brazil can be purchased for $400 to $500 an acre. The average price for Iowa farmland is $2,400 an acre. About 120 million acres have been cleared for crop production and pastures and another 200 million acres are in reserve.
Production costs in Brazil are also lower and the tropical climate supports double-cropping, or growing two crops a year. The country's government is committed to agriculture as a vehicle for economic growth, and there are few restrictions on foreign ownership of land. Brazilian officials have visited the United States to talk with Americans considering farming.
U.S. prairie states pride themselves on having some of the world's best farm land, but research in Brazil, first funded by Nelson and David Rockefeller in the 1950s, has provided information that now makes soil quality almost irrelevant. Research found that lime could counteract the aluminum toxicity and calcium and magnesium deficiencies in the country's soil. "With today's technology, anyone can make soil," said Carlos Roberto Spehar, a Brazilian agronomist.
Soybeans and related products from Brazil and Argentina now exceed U.S. exports. Some agronomists say the transformation of the tropics could be one of the next century's most important contributions to world food security, with the capacity to feed 500 million people using available technology.
Minnesota IssueWatch is an electronic newsletter published by Minnesota Planning to brief decision-makers and citizens on critical and emerging issues. IssueWatch draws from media sources to highlight issues, trends and ideas that could affect citizens and government. Information in Minnesota IssueWatch does not necessarily reflect the opinions or policies of Minnesota Planning or the state of Minnesota.
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