Brazil's Challenging Ag Environment

Brazil's Challenging Ag Environment

Post-harvest dilemma appears as abundant grain supplies have nowhere to go

Brazilian farms have the ultimate advantage – year-round growing weather. But somehow it's not used to its full advantage, mostly because of poor infrastructure and limited storage, a University of Illinois study shows.

"There is a 34% under capacity of soybean storage, and the situation is aggravated by the rapidly increasing production of second-crop maize," said University of Illinois agricultural economist Peter Goldsmith.

Through a research project which used Geographic Information System software to map the coordinates of storage facilities in Mato Grosso, Goldsmith notes if all farmers were to grow a second crop of maize, storage would be a top issue.

Post-harvest dilemma appears as abundant grain supplies have nowhere to go

Goldsmith explained that the research mapped GIS coordinates for every commercial storage facility with capacity greater than 50,000 metric tons and then overlaid a) amount of current grain production and b) projected production totals if farmers were to produce and store a second corn crop on 100% of the bean crop.

The overlay revealed areas that had the most congestion and the least congestion, Goldsmith said.

According to the maps, one region in the northern part of Mato Grosso is about 6.9 million metric tons under capacity. That's 270 million bushels – equivalent to 5,420, 50,000-bushel grain bins, he estimated.

"Of course, the actual undercapacity situation may be less because it assumes double crop production on every acre. It would be highly unlikely that every acre would be farmed for soybean, maize, and a safrinha," Goldsmith said. "Alternatively, though, maize yields are less than half that commonly found in the Midwestern United States."

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Goldsmith explained that while storage is an issue, there are several other problems in Mato Grosso – Brazil's significant agricultural player in grains and livestock – that contribute to post-harvest loss.

"Losses occur in three areas: grain that's left standing in the field after a harvest; during the short-haul when grain falls off of the truck in transportation from the field to either storage or commercial sale; and loss of private storage," he said.

"Short-haul loss is fairly trivial in the United States but it is significant in developing countries where there is no infrastructure, no paved roads. And the roads that are paved are full of potholes and in very poor condition. Commercial trucks used for hauling grain are not in the best shape so there's a 3% loss of grain that falls off the truck," Goldsmith noted.

And while year-round weather allows for significant production, it can actually contribute to the loss because farmers have to harvest soybeans during the rainy season. If they were to wait, they couldn’t plant corn because the dry season wouldn't allow for proper pollination.

In turn, this creates a moisture and drying problem, as well as a speed issue.

"Speed is important because you've got to get the beans out to get the corn in. A farmer might sacrifice soybeans to get the corn planted. And the equipment is in constant demand and kept far from the farmstead so the combines and trucks don't get maintained properly," Goldsmith noted.

While there are significant challenges to grain production in Brazil, Goldsmith said his study provides a look into what can be done to help other regions produce more of the world's food through efficient harvesting, transporting and storage.

"(Brazilians) are part of the global market at the frontier of agricultural production systems," Goldsmith said. "Places like Mato Grosso are at the margin where the food gap can be closed."

"Mapping private, commercial, and cooperative storage in Mato Grosso" was co-authored by João Antonio Vilela Medeiros and published in Portuguese in a 2013 issue of The Soybean Research Journal.

Want more on Brazilian Ag? Check out Bryce Knorr's series on farming in Brazil, or read James Thompson's blog South American Crop Watch.

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