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Agribusiness Brazil: highly technical, export-oriented and large-scale agriculture


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Agribusiness is the term used to describe an overarching production complex that goes beyond the traditional agricultural sector, and thus encompasses all economic sectors related to agriculture.
In Brazil, the term agribusiness is used to describe capital-intensive, high-tech, export-oriented, large-scale agriculture, which contrasts with small-scale family farming.

In Brazil, crops such as sugarcane, soybeans, corn, cotton, coffee, and oranges in particular are grown on a large scale. Likewise, poultry and pig production is very concentrated, especially in the south of the country, and is of a high technical standard. The country also holds a leading position in the world in the production of beef.

In recent years, Brazilian agribusiness has been characterized by high growth rates and record harvests, thus forming a driving force for the Brazilian economy. It generates one-third of the gross domestic product, 36 percent of all exports and provides about 37 percent of the jobs.

In 2007, US$58.415 billion worth of goods were exported, an increase of 18.2 percent over the previous year. The main customer for Brazilian products is the European Union, which imports 35.8% of all Brazilian exports. Ethanol production and exports, in particular, will continue to increase due to rising demand resulting from increased oil prices.

In 2007, the Brazilian agro-industry grew by 5% compared to the previous year. Within the agricultural sectors, livestock (2.8%) and the upstream sector of the crop protection industry expanded particularly strongly, with growth of 22.6% due to increased acreages of soybeans, sugarcane, corn and cotton. In terms of exports, meat (30.7%) and soy products (22.3%) in particular, as well as forestry products (11.9%), achieved great growth in 2007 compared to the previous year.

The main customers for Brazilian soy products are the EU and China. Beef is sold mainly to the EU and Russia, while chicken meat is exported to the EU, Japan, Saudi Arabia, China and Russia. The majority (54%) of pork exports go to Russia.

Overall, the main consumer countries for Brazilian agribusiness goods are the EU (35.8%), USA (11%), China (8%), Russia (5.8%), Japan (3%), Argentina (2.4%), among others.

The largest part of exports to the EU is soybean (35.4%), followed by cereals, flour and feed (14.5%) and forestry products (12.6%).

The reasons for the increased performance of agribusiness can be found in increased demand, as well as internationally rising prices for agricultural goods. In addition, there is an increased production of cereals and oil crops due to the increasing demand of the agrofuel industries.

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