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Rattlesnake Frontier Answers Brazil’s Farmland Shortage

September 25, 2013
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Atop a mountain plateau in Brazil’s northeastern Piaui state, Luciano Curioni inspects shriveled corn cobs as dust whirls across his rattlesnake-infested farm that has no water, power or a phone.

Farmers like Curioni are testing the limits of climate and technology, pushing the country’s agricultural frontier into increasingly inhospitable regions, as the world’s fourth-largest farm exporter runs out of arable land. Companies providing solutions, such as Deere & Co., Monsanto Co., and Bayer AG, stand to gain.

Unable to afford acreage in the productive western grain belt where his family has farmed for decades, Curioni invested 3.5 million reais ($1.6 million) two years ago to clear 2,000 hectares (4,940 acres), the equivalent of 2,801 football fields, of virgin savanna near the town of Bom Jesus. A drought this year left him owing 1.3 million reais and nearly drove him into bankruptcy.

"I was about to give up but others here have made money, so I’ll try again -- I’ll be praying more than usual next season," Curioni said, dodging knee-deep potholes as the wipers clear dust off the windshield of his beat-up pickup truck. "The land here is cheap but operational costs are high, logistics poor and rains are, well, uncertain."

Driven by rising global food demand, stricter environmental laws and expansion of protected areas, arable land prices have risen as much as sevenfold in some regions over the past decade.

That’s more than four times the return of shares in Petroleo Brasileiro SA, the country’s largest company by market value. The United Nations’ Food Price Index, which is made up of 55 agricultural commodity prices, in August was about double its level a decade ago.

 

Farm Exports

 

Brazil, which accounts for about eight out of 10 liters of orange juice shipped worldwide, has more than quadrupled its farm exports to $83.4 billion last year, according to the Agriculture Ministry.

"Technology and management, not land, are the future," former Agriculture Minister Roberto Rodrigues said by phone from Sao Paulo. "The cost in traditional growing regions makes expansion inviable and is pushing the frontier to its limits."

The winners in this rural transformation are farmers who embrace the latest know-how. After losing 70 percent of his crop to the worst drought in 30 years, Curioni has ordered detailed soil testing and will install satellite-monitored humidity sensors. He also plans to intensify tilling and use more limestone to allow deeper roots so plants can better resist dry spells.

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RELATED TOPICS: Corn, Land, Exports, Global Markets

 
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