The Success Stories of American Companies in Brazil

 Brazil has about 200 million people, making it the most populous country in South America and the fifth largest country in the world in terms of land size. Brazil also has one of the largest natural resource reserves and an economy that is stronger than all of its South American neighbors. Its agribusiness, advanced mining industry, manufacturing, and services sectors are all much more developed than those in its neighbors. Brazil has a huge amount of promise in agribusiness. Even though the sector already makes up about 22% of the country's GDP, it is becoming even more important to Brazil and the global commodity markets. The country currently grows the most sugar cane, coffee, and tropical fruits in the world. It also has the most industrial cattle and the most soybeans exported. About 176 countries buy livestock from Brazil. Even so, only 9% of the land is used for crops, while 13.2% is used for grazing.

The market for farm goods in Brazil is growing faster

The size of the local market grew by 12.6% each year from 2012 to 2016, reaching a value of $113.5 billion. In 2017, the country had a $81.8 billion surplus in agricultural exports, but a deficit of $14.8 billion in all other areas. As a result, the agribusiness industry helped the country make a total surplus of $67 billion. Also, the country has increased the production of fibers and grains by more than 400%. The outlook for the near future is also very good; the agricultural products market is projected to reach 1,129.4 million tons by 2021, which is a 7.7% annual increase over 2016. It is expected that the industry will grow because of adding degraded pasture lands to cultivated land, big steps forward in technology, and the use of new technologies like GMOs. There is also a growing desire for food around the world, especially proteins. Even though the future looks bright for agriculture in Brazil, the country still has to deal with some problems before it can fully benefit from this growing part of the economy. The biggest problem is that the country's infrastructure, especially its operations, isn't up to par. This makes the country less competitive by making freight costs go up. The results are not good enough, even though attempts were made to fix infrastructure problems, like the Growth Acceleration Program (PAC in Portuguese) during the Lula and Dilma administrations.

The current government led by President Temer started a new infrastructure development program called PPI (Program of Partnerships and Investment) in answer to the problems with the PAC. The PPI puts most of the duty for making the needed investments in roads, trains, energy, air travel, telecommunications, housing, water, and sanitation on the private sector. Brazil wants to solve some of the problems that slow the country's growth and make it harder for businesses to get things done by easing the bureaucratic process and making it more appealing to invest in needed infrastructure.

The Brazilian farm products market has grown by more than 10% each year

Because of a strong export market and rising demand for goods around the world, especially minerals, protein, and agricultural goods. The Brazilian domestic agricultural goods market was worth $135 billion in 2016 This is the same as a 12.6% compound annual growth rate (CAGR) from 2012 to 2016. On the other hand, the US and Canadian markets went down by -3% and -2.9% CAGR, respectively. Furthermore, Brazil's exports of agricultural goods brought in $84 billion in 2016, which is 45.9% of all export revenues. They also created 32% of all jobs in Brazil, showing how important the sector is to the country's financial stability.

The amount of food that Brazil grows is expected to rise at a rate of 4.6% per year from 2016 to 2021 (See Table 1). If you compare the 2029/30 grains crop to the 2016/17 crop, the planted area will grow by 22% and output will rise by 33%. In the same way, production of chicken, beef, and pigs is projected to rise by 41.1%, 26.3%, and 37.4%, respectively. The rise in production will be driven by a rise in exports, which are expected to rise by 46% for chicken, 45.1% for beef, and 54.4% for pork. Even though more meat is being produced, soybeans are still the most important crop for exporting. They make up 10% of the country's foreign sales and bring in $19.33 billion (See Figure 2). Out of the 1497 goods that Brazilian agribusiness exports, just 10 make up 70% of the value of those exports. This shows that Brazil's agricultural exports are not very diverse. Brazil's farmland now has the second-highest market value in the Americas, at 28.2%, after the US (see Figure 3). In contrast to the US, Brazil's farming activity still has a huge amount of room to grow. This is because there is still land available, new techniques are being developed to make land use more efficient, and the country is working to fix some of its biggest problems. Analysts predict that the market value will grow at a rate of 17.6% per year from 2018 to 2021, which is very good news for farmers in Brazil.

Brazil is now the world's second-largest user of genetically modified crops

After the US. This is because the country's approach to farming is very advanced, which has made plants that are resistant to insects and diseases grow better. The country also uses fewer agrochemicals than other top crop producers (see Figure 4). This is because it has a lot of new ideas and technology. Unfortunately, the pace of putting new technologies to use has slowed down over the past few years because investments have dropped sharply because of the country's weak economy and finances. However, as the economy comes out of the recent recession, spending in these key areas is likely to rise again. Because agriculture is a big part of Brazil's income, these improvements are very important. Together with government incentives, these investments help farmers lower the risks they take when they plant. This makes it easier for small producers to get started. Small farmers are very important to Brazil's agricultural sector. They own more than 80% of the production units in the country and are in charge of 38% of the gross value of agricultural production.