What explains the intensification and diversification of Brazil´s agricultural production and exports?

Via http://www.brazil4africa.org

Summary

Since 2000, Brazilian agricultural production and exports have increased enormously. The production of crops rose by over 150%, while exports multiplied eightfold from 1990 to 2012.

We have undertaken new econometric analysis to understand the factors driving this growth and have found:

1. Brazil is no longer predominantly an agricultural country, despite the fact that agriculture continues to represent around 5.2% of GDP and supports a diversified and fast-growing agribusiness sector which in turn amounts to 22.2% of GDP.

2. Agricultural and agro-industrial production and exports have increased and diversified simultaneously since the 1970s with the farming of new areas.

3. The location of the fastest-growing farming areas shifted during 1970-1990 from the South and Southeast regions to the Central-West region. Since 2000 a new agricultural frontier has emerged in the Cerrado (savannah) areas bordering the states of Maranhão, Tocantins, Piauí and Bahia (known as MATOPIBA).

4. Global GDP growth and increased Brazilian agricultural and agro-processed production have been the main drivers of rising Brazilian agricultural and agro-industrial exports, rather than international prices. In the international market Brazil has taken over a share vacated by the USA and European Union countries.

Brazil does not have a predetermined ‘model’ for intensifying its agricultural performance. Instead Brazil has adjusted its agricultural policies in response to the constraints and opportunities arising in both domestic and international markets, while maximising the advantages it has in terms of agricultural land availability and a good climate.

Full article here

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