BRAZIL: Soy Farmers Demand Greater Support in Crisis

By Mario Osava Reprint | | Print |

Mario Osava

RIO DE JANEIRO, May 15 2006 (IPS) - Protests by large soybean farmers and ranchers in Brazil, which will culminate Tuesday in demonstrations around the country and a march on the capital, reflect a crisis that was unimaginable just three years ago, when export agriculture was experiencing a boom that had foreign competitors on edge.

The so-called “alert from the countryside” movement that has been blocking roads and bringing activity in banks and government offices to a halt since Apr. 27 is demanding that the government take measures to guarantee farmers minimum prices for their products.

They are also calling for long-term restructuring of their debts, which built up over decades but have been aggravated by two years of drought and the overvaluation of the local currency, the real.

The financial aid announced in April, and additional measures announced last Friday, like increased availability of credits and measures to shore up prices and boost the incomes of farmers, “fall short and reveal the indifference to our plight on the part of the government, which has not yet comprehended the problems plaguing farmers,” Cesario Ramalho, vice-president of the Brazilian Rural Society, which represents large-scale farmers and ranchers, told IPS.

Tuesday’s protests will differ from the previous ones in that they will “bring out the grassroots” and will be dispersed around the country, especially bringing to a halt activity in the leading agricultural states, with the support of other sectors also hurt by the rural crisis, like truckers, shopowners, students and a few industries, said Ramalho.

Insolvency is afflicting the entire countryside, especially soybean farmers, who have seen their profit margin on exports shrink as international prices have dropped and the real has gained steadily on the dollar.

Brazil is now the world’s top exporter of a number of agricultural products, including soy, beef and chicken.

The country’s grain harvest grew from 83 million tons in 2000 to 123.3 million in 2003. But after that it began to shrink, to 113.9 million tons in 2005, according to Ministry of Agriculture figures. Layoffs in sectors tied to the rural economy, like the farm machinery industry, have compounded the growing rural unemployment.

This is “the worst crisis in Brazilian agriculture” in decades, according to Pedro Camargo Neto, a former Ministry of Agriculture official who today heads the association of pork producers.

The downward trend is expected to continue this year, since the total area planted has shrunk five percent. Nor will there be any recovery next year if the government of Luiz Inácio Lula da Silva fails to adopt more effective measures in support of the sector, said Ramalho.

Minister of Agriculture Roberto Rodrigues has acknowledged the difficulties facing farmers and has promised new government initiatives, which could be announced on May 25.

The exchange rate is “the number one problem,” but not only for agriculture, he said, pointing out that it has led to the closure of a number of footwear and textile factories, and has been blamed by Volkswagen for its massive layoffs.

Rodrigues also pinned the blame on high interest rates, even though farm loans are cheaper than credit in other sectors. In addition, he pointed to the costs of transportation and storage, “excessively” high taxes, and costly insurance that he said fails to adequately cover a high-risk activity.

The protests began nearly three weeks ago, when hundreds of tractors blocked highways and streets to stop transportation of farm products, livestock and agricultural inputs. In addition, a number of truckers went on strike in solidarity.

The mobilisation has been at its most intense in the central-western states of Mato Grosso and Mato Grosso do Sul, the country’s biggest soy and beef producers. Food shortages have begun to be felt in several cities, soy processing and meat-packing plants are running out of raw materials, and the impact has reached the urban economy.

In Mato Grosso do Sul, the situation has been aggravated by the ongoing drought and by outbreaks of food-and-mouth disease first discovered last October.

The country’s agribusiness sector has been demanding solutions to the crisis since last year, when 25,000 farmers descended on Brasilia – riding their tractors – in June.

On Tuesday, organisers expect only 500 protesters in the march on the capital, while a number of demonstrations will be held in farming regions around the country.

The leaders of the agribusiness industry said Tuesday would be the peak of their protests, but warned that they would continue to mobilise until securing real solutions to the crisis.

The rural unrest has also included a spate of activity by the Landless Rural Workers Movement (MST) demanding that the government expand and speed up its land reform efforts.

Last month, MST activists stepped up their occupations of land deemed unproductive – which under Brazilian law is subject to expropriation and redistribution – as well as highway marches and city protests in what has come to be known over the years as the movement’s “red April” campaign – a reference to the colour of the MST logo and banners.