RAYMOND, Maine — Brazil’s farmers have faced many challenges since 2019. Since 2019, there has been a series of droughts and crop failures, and extensive agricultural businesses competing with typical Brazilian family farms. The latest struggle that Brazil’s farmers are facing is fertilizer shortages as prices skyrocketed worldwide and exportation from Russia’s usual source became both expensive and challenging.
Economic Importance of Brazilian Farms
Brazil’s farms are part of the foundation of the nation’s economy. Annually, Brazil’s farming sector contributes to at least 4% of the country’s overall Gross Domestic Product (GDP), amounting to almost $72 billion. Moreover, 9% of Brazil’s employment is in the agricultural sector, with this figure remaining stable for several years. Large-scale agricultural businesses started expanding in 2016 when Brazilian legislation changed to favor more prominent companies over family farms. The large businesses use more of Brazil’s agricultural land and compete with the family-run farms that continue to be the dominant type of farm in Brazil. There are 4.4 million Brazilian family farms, which means the family farm structure accounts for 85% of the nation’s farms.
Brazil’s family farms are a major source of food security for Brazil. The Brazilian government began reforms in the early 2000s to support family farms. The reforms gave the smaller farms the legal support to grow and expand businesses. Part of the new legislation allowed for new contracts that enable the use of family farm produce in public institutions like schools, effectively increasing the farms’ earnings. Of the conventional produce that people eat daily in Brazil, family farms produce 87% of cassava, 70% beans, 34% rice and 21% wheat that Brazilians consume daily. Without Brazil’s family farms, Brazil’s food security will vanish, and food scarcity could drive prices up, causing people to lose their relied-upon income and financial security. One cannot understate the family farms’ importance to the Brazilian economy, but their struggles are far from over.
Brazil’s Farmers’ Struggles and Fertilizer Shortages
In January 2022, Brazil’s farms battled a drought that wiped out almost all their soybean production (90%). Brazil’s soybean farmers expected their soybean to reach a height of 50 centimeters, but it did not grow to even 20 centimeters, which meant that their soybean production for the season was not going to come to fruition. The 2021-2022 soybean farming season had heavy droughts that caused Brazil’s soybean farms to lose a minimum of 35% of their production. Crop loss is not the only failure to hit Brazil’s farms in 2022, though.
In February 2022, when Russia invaded Ukraine, the world rapidly found the need to change and force Russia to halt its assault on Ukraine. While many world governments are trying to force Russia to stop its military operations, one of the unexpected consequences hit Brazil’s farms. Brazil is the largest importer of fertilizer in the world. Brazil’s farms require heavy usage of fertilizers because their soils are often not nutrient-rich enough to sustain the produce as it grows. According to figures from 2021, Brazil imported more than 20% of its fertilizer from Russia because it was high-quality and low-priced.
However, as nations placed economic sanctions on Russia, Brazil found Russian fertilizer prices too high. Urea fertilizer’s prices have increased 45%, and phosphorus-based fertilizer prices have increased 16%. Also, due to the exportation and lack of transportation in and out of Russia, it would take too long for the fertilizers to reach Brazil. Prices and transportation issues of fertilizer left Brazil farmers scrambling to find affordable fertilizer that they could attain promptly. If Brazil’s farmers must pay for the more expensive fertilizers as a leading agricultural nation. In that case, prices will need to increase worldwide to accommodate Brazil’s farmers’ extra expenses.
Fixing Fertilizer Supply Issues for Brazil’s Farmers
Brazil has a limited supply of local fertilizer, predominantly due to slow production times and difficulties finding the resources needed to produce fertilizer. Brazil is acclimating to the demand for fertilizer and is seeking to acquire the lowest-priced fertilizer as quickly as possible.
In some ways, Brazil was already bracing itself for the possibility of fertilizer shortages. Brazil’s farmers have been increasing their application of fertilizer and nutrients steadily to bring life back to the soil and make the farms less dependent on fertilizer. Fertilizer in Brazil is still a significant demand, but in the short term, farms can manage without it.
Brazil’s government is implementing plans for rebuilding fertilizer supplies and investing in phosphorus mining so that Brazil can make fertilizer locally and cut future costs in half. Making fertilizer in Brazil allows for jobs in phosphorus mining and does away with importation costs in addition to what the farmers pay for the actual fertilizer. It might take several years for the fertilizer supply to build up enough to sustain Brazil’s farmers, but it can save the country and farmers thousands as a long-term plan.
In the short term, Brazil’s fertilizer supplies can last another three months. In that time, it is hopeful and probable that Brazil’s farmers will find alternative sources of fertilizer. New importation deals are close, and given the world’s reliance on Brazil’s crops, it is in many nations’ best interests to provide fertilizer at rates Brazil’s farmers can afford.
– Clara Mulvihill