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ECONOMIC AND TECHNICAL FEASIBILITY OF INCREASED MANUFACTURE AND USE OF

FERTILIZERS AGRICULTURAL LIMESTONE

LIVESTOCK MINERALS SIN BRAZIL

MANHATTAN, KANSAS

'N

jharoldRectangle

jharoldRectangle

SSEARCH, NC P.O. BOX 727, MANHATTAN, KANSAS 66503

ECONOMIC AND TECHNICAL FEASIBILITY OF INCREASED

MANUFACTURE AND USE OF FERTILIZERS, AGRICULTURAL

LIMESTONE AND LIVESTOCK MINERALS IN BRAZIL

A Report to

The Ministry of Agriculture Government of Brazil

and

Office of Agriculture and Rural Development USAID/Brazil

Contract la-152 1964

Subsidiary of Dunlap and Associates, Inc., Darien, Connecticut

jharoldRectangle

TABLE OF CONTENTS

SUMMARY

ACKNOWLEDGMENTS xx

INTRODUCTION 1

Objectives 2 Procedures 4 Population- Food- Production 9

PRESENT AGRICULTURAL SITUATION 15

Exports -Imports 16 Farm Organization and Operation 21 Agricultural Production 22 Why Most Brazilian Farmers Do Not Use Fertilizer 26 Crops 30 Livestock 46

DEMAND REQUIREMENTS FOR FERTILIZERS 53

Requirements Based on Trends in Apparent Consumption of Fertilizers 54

Requirements Based on Rate of Increase in Fertilizer Consumption in the United States, 1942-1962 59

Requirements Based on Plant Nutrients Extracted by Crops 65

Requirements Based on Recommended Fertilizer Programs 71

The Use of Fertilizer to Reach Production Goals 74 Fertilizer Demand for Use on Pastures 77

NITROGEN 79

Summary 79 Brazilian Nitrogen Consumption 81 Present Brazilian Plans for Basic Nitrogen Production 100 Direct Application Nitrogen in Brazil 104 The Anhydrous Ammonia Station 125 The Aqua Ammonia Station 138

TABLE OF CONTENTS (continued)

147PHOSPHATE

Northeast Region 147 Central Region 15Z

164 Southern Region 155 Imports

168POTASH

168Potash

Minor Elements 170

173TRANSPORTATION AND DISTRIBUTION

173Transportation 193Distribution

FERTILIZER-CROP YIELD RESPONSE Z08

Phosphates in Soil Fertility 21z Nitrogen in Soil Fertility 234

Potash in Soil Fertility 243

Sulphur in Soil Fertility 252

Micronutrients in Soil Fertility Z61 255

Literature Citations

ECONOMIC FACTORS INFLUENCING FERTILIZER USE 270

Z8ZAGRICULTURAL LIMESTONE

Types of Liming Materials 288 289Application of Lime

Limestone Demand Requirements and Resources 296Available

Rock Crushing Equipment Required 299 300Stationary Plant 306Portable Plant

Response of Crops to Ground Limestone 316

TABLE OF CONTENTS (continued)

LIVESTOCK MINERALS 324

Feeding Requirements 324 Salt 326 Calcium and Phosphorous 338 Trace Minerals 355 Livestock Mineral Feeders 358 Economic Value of Livestock Minerals 358

IMPACT OF EXPANDED MANUFACTURE AND USE OF AGRICULTURAL MINERALS 366

Value of Gains 367 Summary 374

RECOMMENDATIONS FOR A PROGRAM FOR THE INCREASED MANUFACTURE AND USE OF AGRICULTURAL MINERALS IN BRAZIL 377

Development of Basic Materials Sources 378 Improvement and Expansion of Processing and

Distribution Facilities 381 Research, Education, Agricultural Extension 388 Market Development and Promotion 400

401Credit 409Conclusion

APPENDIX A - INFORMATION ON PLANNED PROJECTS FOR EXPANSION OF FERTILIZER MANUFACTURE

A-1IN BRAZIL

APPENDIX B - DATA RELATING TO AREA OF CROPS CULTIVATED, YIELD OF CROPS PER HECTARE, VOLUME OF CROP PRODUCTION AND LIVESTOCK

B-1AND POULTRY NUMBERS

APPENDIX C - COST OF RAILROAD CARS, COST AND FLOW DIAGRAM FOR FERTILIZER GRANULATION

C-lPLANT

APPENDIX D - GEOGRAPHIC DISTRIBUTION OF LIMESTONE D-1IN BRAZIL

SUMMARY

The development of a sound and profitable agriculture in Brazil

requires adequate attention to the providing of mineral nutrients for

crops and livestock, Soils in Brazil are generally acid and plant

nutrients have been lost by leaching and depleted by crop removal to

the point that yields have been depressed and the feeding value of crops

and forages reduced.

To maintain present levels of domestic consumption and exports

of agricultural products, by 1970 Brazil must increase its volume of

food production by 23 percent. Improvement in quality of diets is

badly needed and increased exports are necessary to finance economic

development of the country. These goals all require increases in

agricultural production. Although Brazil has vast areas of virgin land,

soils in such areas are generally unproductive and require fertilizer

and lime for profitable cultivation.

Over 50 percent of the Brazilian labor force is employed in agri

culture and agriculture accounts for over 28 percent of the gross

national income. Agricultural products account for over four-fifths

of the total value of exports and account for about one-sixth of the

total imports.

i

The increased agricultural production required by Brazil's

expanding population and export trade can be met in two general ways

increased land in agriculture or increased productivity on existing lands.

This report is concerned primarily with the second of these alternatives,

and more specifically with the possibility of increasing production

through increased manufacture and use of agricultural minerals.

Among the nations of the world, Brazil ranks in the lower third

in relation to fertilizer used per cropped hectare, using only 8. 5

kilograms per hectare compared to 30.9 kilos for the United States,

and a high of 450 kilos for The Netherlands and New Zealand. More

than 95 percent of Brazilian farmers do not use commercial fertilizer.

Enough fertilizer is used to adequately fertilize only eight percent of

Brazil's cultivated lands and virtually no fertilizer is applied to the

vast pasture Freas of the nation. However, during the past decade

fertilizer consumption in Brazil has increased rapidly, particularly

in the intensive areas of cultivation found in Sao Paulo and Rio Grande

do Sul plus other areas of concentrated, specialized production. Only

limited quantities of lime are used despite the acidity of most of the

soils in Brazil.

ii

Demand Requirements for Fertilizers

Basic fertilizer requirements for Brazilian crops, for the present

and future, can be calculated under a number of different assumptions.

Two realistic assumptions used in projecting fertilizer demands were

(1) the trend in fertilizer consumption in Brazil would follow the trend

in apparent consumption existing in Brazil 1950-1963, and (2) fertilizer

requirements in Brazil would expand at a rate equal to the rate of

fertilizer increase in the United States 1942-1962.

Based on assumption (1) continuation of existing trends in apparent

Brazilian consumption, by 1970 Brazil would require 91,000 tons of

nitrogen (N), 191,000 tons of phosphate (PZ0 5 ), and 124, 000 tons of

potash (K 2 O) as compared to 65, 000 tons N, 138, 000 tons P2O5 and

89,000 tons KZO used in 1963. Similar projections to 1983 indicate

144, 000 tons N, 290, 000 tons P 2 0 5 and 196, 000 tons K20 needed by

that date.

Considering assumption (2) rates of increase in fertilizer use

similar to those in the United States 1942-1962, by 1970 Brazil would

require 140,000 tons of N, 200,000 tons of P 2 0 5 and 160,000 tons KZO.

By 1983 these requirements would be 600,000 tons N, 400,000 tons

Pz0 5 and 450,000 tons KZO.

iii

Considering these two assumptions, number (1) should be

considered as a minimum projection and number (2) should be

regarded as a practicable and desirable goal for Brazil. Fertilizer

requirements based on plant nutrients extracted by crops grown and

based on recommended fertilizer programs for major crops were

calculated. Although the requirements resulting were too large for

practical attainment within the reasonable future, they serve to

illustrate the potential magnitude of fertilizer requirements for Brazil.

Nitrogen

Brazil should be able to become self-sufficient in nitrogen produc

tion and should promote the use of direct application of anhydrous or

aqua ammonia, the cheapest form of nitrogen for Brazil.

In 1963 the apparent consumption of nitrogen as fertilizer in Brazil

was 65,400 tons of which 52,000 tons, or 79 percent, was imported at

a cost of nearly $12 million, equivalent to about 60 percent of the cost

of installations required to make Brazil self-sufficient in nitrogen.

Self-sufficiency, at 1963 levels of nitrogen usage, can be achieved

by: 1. Remodeling the Petrobras Cubatao installation to achieve its

full capacity of 25, 000 tons per year of ammonia.

2. Building a new 200 ton-per-day ammonia plant (70,000 TPY)

at Capuava to operate on raw material from the Petrobras

iv

refinery, or construction of 200 TPD anrmonia-urea plant

in Bahia to take advantage of locally-available natural gas.

The cost of either of these alternatives would be $16 million

to $20 million depending on the type of final products required.

both plants should be contructed.In the longer-run, by 1970,

Production of ammonium sulfate from local steel plants

should also be encouraged.

To make a start in the use of anhydrous or aqua ammonia, it is

withrecommended that five direct application ammonia stations,

storage tanks, nurse tanks and applicators, be built in the State of

orSao Paulo to operate on ammonia from Cubatao on ammonia imported

through the facilities of Ultragaz. The cost of these five stations would

be approximately $275,000.

Phosphate

Brazil will become much less dependent on imported phosphate

through the development of some of the fertilizer industry's plans

for the manufacture of soluble P2 0 5 . Feasible plans, already in

indicate that Brazil can become self-sufficient in phosphateexistence,

production by 1970.

reserves of phosphate are well-Fortunately, large and suitable

central and southern parts of the country so as tolocated in the north,

v

provide adequate coverage for existing and planned agricultural areas.

The regional location of phosphate production is of particular impor

tance in view of the transportation difficulties which exist in Brazil.

The major reserve of phosphate in the Northeast is that controlled

by Fosforita Olinda near Recife. Although a well-designed and main

tained processing plant with a capacity of at least ZOO, 000 tons per

year is in operation, high freight costs and a limited local market

have combined to keep plant output low. Other smaller phosphate

plants in the Northeast add to the regional total production to the point

that ample supplies of locally-available phosphate should be obtainable

for this region.

With the largest known deposit of phosphate in Brazil, and a

feasible plan for the production of thermophosphate, CAMIG at Araxa

in Minas Gerais should be able to supply the Central region of Brazil.

Thermophosphate is well-suited to soil conditions in Brazil and CAMIG

has a loan application pending with the Agency for International

Development which would permit the beginning of contruction of the

necessary plant. The CAMIG thermophosphate plant should be approved

for construction. At present CAMIG has a modern, well-maintained

and operated plant producing direct application rock phosphate. There

is a report of phosphate deposits in Goias which could add to the supply

vi

of the Central region and which would be strategically located in view

of the path of agricultural land development in this region.

Almost 90 percent of the fertilizer consumed in Brazil in 1963

was used in the four states Sao Paulo, Parana, Santa Catarina and

Rio Grande do Sul. The principal deposit in this area is at

Jacupiranga where plans are now progressing for the construction

of a plant to produce 100,000 tons per year of concentrate in the

first year with rapid expansion to 300,000 tons. The operation is

based on a new method of benefication of large, underlying deposits

of low-grade ore, and the process appears feasible. There are

reports of additional phosphate deposits in the Southe'n region which

could add to production in this area.

In spite of the general availability of phosphate in Brazil, a

strong program of geological exploration should be continued to

locate additional reserves for future needs.

Potash and Minor Elements

There are no known deposits of potassium minerals in Brazil and

for the foreseeable future Brazil will be primarily dependent on imports

of this mineral. Research on the extraction of potassium from sea

water and from feldspar and carnallite should continue, but offer little

hope at present for the production of potassium for fertilizer use.

vii

Since the soils of Brazil are generally acid and badly leached,

there probably exists minor element deficiencies in many areas. It is

suggested that a general purpose minor element mix be used in formula

fertilizers in Brazil.

Transportation and Distribution

The lack of an adequate and efficient transportation system has

been a major factor retarding the development of the agricultural

minerals industry in Brazil. Coastal shipping rates and port charges

on agricultural minerals in Brazil have been so high that in early 1964

orit was cheaper to transport phosphate rock from the United States

Africa to Santos than it was from Recife to Santos. Port congestion

and high cargo handling charges, particularly at Santos, further

adequate system of railroads oraggravated this problem. Lack of an

highways further restricts interregional transportation of fertilizers in

Brazil and emphasizes the desirability of developing regionally-oriented

sources of supply.

The consumption and distribution of fertilizers in Brazil varies

aregreatly from region-to-region. In general, distribution facilities

However, in certainreasonably adequate at present levels of demand.

areas, such as parts of the Northeast, fertilizer is not readily avail

able and an expanded distribution system would be required. Another

viii

exception is the lack of distribution facilities for liquid nitrogen

products, as was discussed in the section dealing with nitrogen

fertilizers.

Fertilizer-Crop Yield Response

Fertilizers, used in combination with other good farm management

practices, offer the possibility for substantial yield increases for most

crops in Brazil. All available research relating to fertilization

experiments done in federal, state and private research institutes and

in agricultural colleges in Brazil was reviewed and summarized.

In general, it was found that a typical application of 75 kilograms

of P205 (phosphate) per hectare resulted in yield increases of 15 to 30

percent on sugar cane, 20 percent on corn, 10 to 15 percent on coffee,

20 to 25 percent on cotton, 10 to 20 percent on rice and substantial

increases in the production of potatoes and wheat. However, to get

the most satisfactory results, phosphate must be applied together

with other fertilizers, lime and in combination with other good

management practices.

The need for nitrogen in the production of crops in Brazil is

second only to the need for phosphorous. An almost universal yield

response was reported for nitrogen. This indicates that over wide

areas of Brazil and for many crops, the application of nitrogen

ix

increases production. On coffee, nitrogen increased yields approximately

10-40 percent with some increases being much greater. Corn yields

rose about 25 percent from the application of 60 kilograms of N and

cotton yields increased by a similar amount. Yields of sugar cane

also increased about 20 percent from the application of approximately

75 kg. of N.

Most Brazilian soils contain a supply of potash in a form available

to crops. However, when soils have been cropped for a long period,

and especially when conditions of management have resulted in heavy

production, then potassium deficiency frequently becomes evident. A

relatively large amount of research has been done in Brazil on the

response of sugar cane to potash, and a typical application of 75 kg. of

KzO per hectare has brought about yield increases of 20-25 percent. A

limited amount of research on coffee, corn, cotton, grasses, potatoes

and wheat has also shown a positive yield response to potash.

Sulfur is another mineral element that is deficient in many areas in

Brazil. Since natural deposits of sulfur do not apparently exist in Brazil,

it has not been readily available for use in fertilizer. Fertilizer trials

with sulfur on grass and cotton showed yield gains from this element.

Somewhat the same situation exists with micronutrients such as boron,

copper, iron, manganese, molybdenum and zinc. Limited experimenta

tion has indicated positive yield responses from the addition of these

x

microelements. The use of dolomitic limestone, which contains

magnesium, available in many areas in Brazil, has shown superior

response over calcitic limestone.

Economlc Factors Affecting Fertilizer Use

Economic levels at which farmers can apply fertilizers will

depend on yield increases obtained, value per unit of product, and

cost of the fertilizer element and application.

In recent years in Brazil, the increase in crop prices has lagged

behind the rate of increase in fertilizer prices. However, in spite of

this unfavorable relationship, the use of fertilizer in Brazil appears

to have been profitable.

Net returns to farmers from the application of nitrogen to crops

ranged from highly profitable returns to some which were negative.

In every case where a relatively inexpensive source of N (ammonium

sulphate) was applied to crops and where PZO5 and KO were also

available, positive net returns resulted. This relationship further

emphasizes the importance of developing the use of anhydrous

ammonia, the cheapest source of N to Brazilian farmers.

The application of phosphate was generally profitable, especially

when used in moderate amounts and in combination with other plant

nutrients. In the case of potash, it appeared that the application of

xi

K 2 0, with or without other plant nutrients, was generally profitable.

Good yield increases were observed, and the cost of potassium

chloride is relatively low.

Agricultural Limestone

A program to improve the productivity of Brazilian agriculture

must include steps to increase the production and use of agricultural

limestone. Except for the arid zone of the Northeast, presently

cropped soils in Brazil are generally so acid (pH 5. 5 or less) as to

inhibit yields of major crops. It is estimated that out of the 28.5

million hectares cropped in 1963, at least 10 million were so acid as

to need limestone.

Both calcitic and dolomitic limestone deposits are well-distributed

throughout eastern and central Brazil and in southern Goias and Mato

Grosso. However, the western half of Sao Paulo, Parana, Santa

Catarina and Rio Grande do Sul lack known deposits of limestone.

To raise the pH by 1.0, for example from 4.5 to 5.5 on 10 million

acres of acid soils would require approximately 30 million tons of

or 3. 75agricultural limestone applied over an eight-year period,

million tons per year. This compares with an estimated 1963 produc

tion of ground agricultural limestone in Brazil of 250,000 tons. In

view of the importance attached to the correction of acid soils in Brazil,

xii

the production of at least 3, 750, 000 tons of agricultural limestone

per year should be adopted as a goal to be reached through a 25

percent increase per year for 12 years. This goal can be reached

providing adequate rock crushing equipment is made available.

Rock crushers and mills for the production of agricultural lime

stone can be either stationary or mobile. Most plants operating in

Brazil today are relatively inefficient, stationary installations. Port

able, high capacity crushers as used in the United States could produce

agricultural limestone in Brazil at a cost of $1. 47 per ton as compared

to $1. 90 for a stationary plant. It is recommended that at least one

modern, portable limestone crusher be brought to Brazil as a demon

stration unit to be operated in principle limestone producing areas.

Application of limestone to crops in Brazil resulted in increases

in production generally ranging from 20 to 60 percent. Economic

returns from the use of limestone were generally profitable,

especially for sugar cane and cotton. Corn and wheat showed good

yield increases, but being lower-valued crops did not return as

large a profit as did sugar cane and cotton.

xiii

a/ri

Livestock Minerals

An adequate supply of essential minerals is necessary for the

health and growth of livestock. The principal minerals required are

salt, phosphorous and calcium, together with small amounts of other

minor mineral elements. Of these minerals, salt is almost universally

deficient in livestock rations. The other minerals required are

normally available in rations commonly consumed by livestock.

However, in areas where soils are deficient in these minerals, it is

necessary to supplement rations by feeding mineral mixtures. Such

is the case over much of Brazil where soils are generally deficient

in calcium and phosphorous. Instances of cobalt deficiency have been

observed in Ceara. As a result, Brazilian stockmen and poultry

producers should follow the practice of providing a basic mineral

supplement to their livestock and poultry.

Based on present and projected numbers of the various species

and classes of livestock and poultry in Brazil, and on per head mineral

requirements, and assuming certain practical levels of use, livestock

and poultry in Brazil would have required 956, 000 tons of salt, 219, 000

tons of calcium and 160, 000 tons of phosphorous in 196Z, and will

require 1,131,000 tons of salt, Z64,000 tons of calcium and 191,000

no difficulty intons of phosphorpus by 1970. Brazil should have

xiv

providing these amounts of mineral supplements for livestock. Salt

production is mainly from solar evaporation of sea water and this

volume of production could be increased or salt could be obtained

from large rock salt deposits located primarily in the Amazon Basin.

Both calcium and phosphorous could be obtained in adequate amounts

from either steamed bone meal or from defluorinated tricalcium

phosphate produced from normal superphosphate fertilizer which

appears to be the more feasible source. Minor mineral elements

should be fed where evidence of such mineral deficiencies persist.

No adequate basis exists for the estimation of the expansion in

livestock production which could result from increased feeding of

minerals to livestock in Brazil. However, an increase of but 5. 8

percent in production would offset the cost of livestock minerals in

1962 and it is reasonable to assume that the gain in production from

feeding livestock minerals could easily be ten percent or more. Thus

feeding livestock minerals would appear to be profitable in Brazil.

Impact of Expanded Manufacture and Use of Agricultural Minerals

Expansion of the manufacture and use of agricultural minerals in

Brazil will have a three-dimensional effect on the economy of Brazil.

Agricultural production will be increased for both domestic and export

sales and dependence on imports of agricultural minerals and

xv

agricultural products will be decreased. Further these developments

are interrelated and complimentary in their effects.

Although precise calculation of the direct and indirect values

attributable to increased manufacture and use of agricultural minerals

in Brazil is impossible, an estimate of the total annual value added to the

Brazilian economy by 1970 has been made. The total gain is estimated

to be approximately $387.4 million, of which $326.9 million results

from increased manufacture and use of fertilizers, $10.5 million

from increased use of agricultural limestone, and $50. 0 from

increased use of livestock minerals.

Recommendations for a Program for the Increased Manufacture and

Use of Agricultural Minerals in Brazil

Expansion of the manufacture and use of agricultural minerals in

Brazil must proceed in a coordinated pattern to product the greatest

economic gains. Five basic areas of development must be considered:

1. Development of basic materials sources processing and distribution2. Improvements and expansion in

3. Research, education and agricultural extension activities

4. Market development and promotion

5. Credit

Appropriate and simultaneous progress in each of these areas is

of the program. The development ofessential to the overall success

the plan will necessarily require close cooperation between government

xvi

and private industry. However, to the greatest extent possible,

control of basic materials resources, investments in processing and

distribution facilities, and retail sale of agricultural minerals should

be in the hands of private industry.

Development of basic materials resources must proceed through

an expanded, systematic minerals exploration and appraisal program,

and a review and appraisal of presently-known mineral reserves.

Close coordination between the petroleum industry and the agricultural

minerals industry will facilitate such progress.

Immediate encouragement should be given to the expansion of

nitrogen production capacity through remodeling the Petrobras Cubatao

installation to bring it to full capacity, and initiating plans for

construction of synthetic ammonia plants at Capuava and in Bahia.

The full ammonia potential of the steel industry should also be

developed. Plans and pilot distribution stations for the distribution

of anhydrous or aqua ammonia should also be given priority. Although

such expansion is necessary, production capacity must not run too far

ahead of demand.

Brazil can become self-sufficient in phosphate production.

Fosforita Olinda, Araxa, and Jacipuranga all have valuable reserves,

areas.well-located to serve major agricultural Fosforita Olinda

should be brought to full capacity through building demand in the

xvii

Northeast. The thermophosphate operation at Araxa appears feasible

and should be activated. Full-scale pilot operations at Jacipuranga

should be completed and appraised regarding the feasibility of expanded

commercial operations at that location. Other smaller plants should

be expanded where well-conceived plans exist. The possible develop

ment of processing facilities in new areas, such as Goias, should be

considered as commercially-valuable deposits of phosphate are

discovered.

Research relating to the development of potash from local sources

should continue.

A major problem in expanding the use of agricultural minerals in

Brazil is that of demonstrating to farmers and stockmen the desirability

and profitability of using fertilizers, agricultural limestone, and live

stock minerals. Research, education and extension activities,

coordinated with advertising and promotion efforts of the agricultural

minerals industry must be substantially expanded to meet this need.

National, international and private research and educational agencies

must work together in a coordinated program.

Finally, credit must be made readily accessible to industry and

agriculture to permit the growth of the agricultural minerals industry.

Foreign exchange credit must be granted to industry for the timely

xviii

purchase of imported raw materials and necessary equipment items.

Credit must be available and investments encouraged by combinations

of national and foreign capital where required for the construction of

plants and the purchase of equipment. Credit must be available for

operating expenses and discounting accounts receivable of processors

and distributors. Farmers must be educated with regard to the

usefulness of production credit and such credit must be readily

available to them on reasonable terms. The credit institutions to

provide such funds already exist in Brazil. The major problems

are improving their services to agriculture, making such credit

readily accessible when required, and educating farmers to the use

of production credit for the purchase of agricultural minerals.

The adoption and implementation of a program for the expansion

of the manufacture and use of agricultural minerals in Brazil, will

require the cooperation and coordination among national and inter

national agencies and private industry. Insofar as may be possible,

control and investment in the agricultural minerals industry should

remain in the hands of private industry. The agricultural minerals

industry is of strategic importance to the future of Brazil, and should

receive the priority of interest and support which it requires.

xix

ACKNOWLEDGMENTS

This study would not have been possible without the interest and

assistance of the many agencies, firms, institutions and individuals

associated, directly or indirectly, with agriculture in Brazil.

The cooperation and assistance received from Dr. Richard Newberg

and Dr. Jefferson Rangel, Co-Directors of E. T. A., in reviewing pro

ject plans, developing contacts and providing general administrative

coordination were most helpful in keeping the study operating smoothly

and on schedule. Mr. Leonard Brooks, AID Liaison Officer for this

project, was most helpful in expediting project progress. Other E. T. A.

and AID personnel also provided time, information and useful sugges

tions.

Oscar Thompson, Filho, Minister of Agriculture and formerly

Secretary of Agriculture in Sao Paulo, took valuable time from his

duties to discuss the needs for and problems associated with agri

cultural minerals and plans to increase fertilizer production in Sao

Paulo.

Information on the present size and scope of the agricultural

minerals industry and plans for future production and distribution

of fertilizer and minerals was made possible by the cooperation

and interest of the many firms and individuals in the industry.

xx

formerly President of Syndicate of FertilizerDr. Fernando Cardoso,

Mixers and Blenders and now Secretary of Agriculture of the State of

and Jose Arnaro Pinto Ramos of Quinbrasil and theirSao Paulo,

staffs were particularly helpful in this respect.

Publications and price data for agricultural products and supplies

Head of the Division of Agriculturalprovided by Dr. Rubens Dias,

invaluable in determining the economicEconomics for Sao Paulo were

value of fertilizer use.

The information and cooperation received from agronomic

institutes and agronomists, throughout Brazil, was important to the

development of a better understanding of the yield response from

fertilizers on various crops in Brazil.

Appreciation is also due the numerous other agencies and

individuals who provided assistance and information on credit,

transportation, agricultural policies and problems and many other

areas of activity of importance in a study of this nature.

xxi

ECONOMIC AND TECHNICAL FEASIBILITY OF INCREASED

MANUFACTURE AND USE OF FERTILIZERS, AGRICULTURAL

LIMESTONE AND LIVESTOCK MINERALS IN BRAZIL

INTRODUCTION

The foundation of agriculture is in the soil, and the development

of a sound and profitable farming system for Brazil requires adequate

attention to the providing of adequate mineral nutrients for crops and

livestock.

Experience and research in Brazil and throughout the world have

shown that crop productivity can be markedly increased by proper use

of fertilizers and agricultural limestone, and that the health and effi

cient growth of livestock require a specific mineral balance in rations

consumed. An adequate and economical supply of plant nutrients and

livestock minerals is essential to the maintenance of a sound and

expanding agriculture. Brazilian agriculture is losing its battle with

time. The history of agricultural production in Brazil has, with some

exceptions, been that of exploitation of the soil, plant nutrients have

been depleted to the point that yields have been depressed and the

feeding value of feeds and forages has been reduced. Still more

important is the fact that climatic conditions over much of Brazil are

such that, even on newly-cleared lands, the basic plant nutrients in the soil

-2

have been depleted through leaching, erosion and other losses to the

point that the natural productivity of these soils is so low that even on

these lands the application of fertilizers and lime is generally required.

In order to halt this downward trend in the supply of mineral

nutrients available to crops and livestock in Brazil, and to undertake

to replace these elements which have been depleted from the soil, it

is essential that there be developed an economically sound and prac

ticably workable program for the promotion of the manufacture and

use of fertilizers, agricultural limestone and livestock minerals in

Brazilian agriculture.

It is the purpose of this report to determine fertilizer and other

agricultural mineral requirements and to describe in detail the economic

and technical potential of Brazil for the manufacture of fertilizers,

agricultural limestone and livestock feeding minerals, and to appraise

the potential impact which would result from increased use of these

materials in Brazil.

Objectives

The objectives of the project were as follows:

1. Measure and project the need and demand for fertilizers,

agricultural lime, and livestock minerals in each of the major

areas of agricultural production in Brazil.

-3

2. Determine the potential sources of ingredients for fertilizers,

agricultural lime, and livestock minerals in relation to

possible areas of demand.

3. Analyze the probable costs of transportation from points of

production to areas of consumption under alternative trans

portation systems.

4. Describe the most feasible system for the manufacture and

distribution of fertilizers, agricultural lime, and livestock

minerals in Brazil.

manu5. Define the number, type and location of the required

facturing, blending and distribution facilities required, and

present preliminary engineering plans and specifications for

the needed facilities, including the estimated cost of each

facility.

6. Analyze the direct economic benefit of each proposed facility,

including a projection of its annual earnings and operating

costs, and compute a benefit-cost ratio for each proposed

facility.

7. Determine the over-all economic benefits of each proposed

facility to producers, the various Brazilian states and to the

nation, and the improvement in Brazil's foreign exchange

position which might result due to increased exports and

decreased imports of agricultural products and supplies.

-4

8. Outline specific Brazilian national and state policies designed to

stimulate the economic use of fertilizers, agricultural lime, and

livestock minerals, including an indication of adequate and economic

sources of supply of these materials.

9. Outline workable plans and procedures for the financing, con

struction, operations and management of the fertilizer, agri

cultural lime, and livestock minerals facilities proposed.

Procedures

The principal part of the work on this project was carried out in

Brazil. Work in Brazil began January 2, 1964, and was completed

May 5 of the saine year. Team personnel and their areas of re

sponsibility were as follows:

Dr. Raymond E. Seltzer, Project Director Dr. Phil S. Eckert, Project Co-Director Dr. George W. Barr, Farm Management Consultant Mr. Foster Crampton, Chemical Engineer Mr. George Crichton, Chemical Engineer Mr. Victor Pellegriri, Agricultural Economist and liaison

representative with Escritorio Tecnico de Agricultura (ETA)

Mr. Luis Rainho, Agronomist and liaison with Ministry of Agriculture, Covernment of Brazil

Mr. Robert Rathjen, Agricultu-a1 Economist.

In the initial stages of the project, team members traveled

extensively throughout the agricultural and agricultural mineral

producing areas of Brazil, visiting farming areas, agricultural

experiment stations and research institutes, mining operations,

-5

agricultural mineral processing and mixing plants, state and national

government agencies concerned with problems of agricultural mineral

production and use, and private firms in the agricultural mineral

trade (Figure 1). Discussions with these groups proved of great

value in appraising the existing status and potential role of such

minerals in increasing agricultural production in Brazil.

A large amount of research and study has been devoted to prob

lems relating to the supply and use of agricultural minerals in Brazil.

Careful attention was devoted to a study of such work, both that

which has been published and experimental results available only in

These studies generally divide themunpublished research reports.

selves into two major groups: (1) studies relating to the problems of

agricultural mineral supply and demand for specific areas, and

research related to the crop yield response associated(2) agronomic

with the application of specific amounts of specific minerals to

specific crops in specific areas. The recommendations in this

report are, of necessity, based on careful review and appraisal of the

results of these studies, conducted in Brazil by Brazilian scientists

whose training, knowledge, interest and experience have resulted in

substantial fund of knowledge from which the recommendationsa

made in this report have been largely derived.

In this sense then, this report is a cooperative effort between

AMAPA IDBRANCO

AWL~ONAS I,

RIO;.00 MOIRTF

, PARAIBAjj PIAII

,AOORS'O GOA ,' ' AInsA' ACRE ' ,' , ]"'','i!BAHIA-ml -' Ri'lifI'' I S1

RODOI

r ' MIA oAI V'. as

.'--.1 p r JAMIRO

/PARANA +"

litG.DO SWOL STA.CATAR1N

Figure 1. Locations visited during stuzdy of agricultural minerals in Brazil

-7-

Brazilian scientists, the agricultural minerals industry, government

agencies, and others on one hand, and the Agri Research team on the

other hand. The cooperation in terms of access to published and un

published reports and the time given by Brazilian groups to discussions

with project personnel, plus their review and appraisal of the results

of this work in its developmental stages, have been of great value in

the development of a report which it is hoped will be both technically

accurate and practically acceptable.

In the area of studies relating to fertilizer supplies and demand,

particular appreciation should be given to the several recent work

groups who have developed reports of significant value to this segment

of the agricultural economy of Brazil.

An excellent report, published in October 1963 and basic to the

study of the fertilizer situation in Brazil, was prepared by a work

group, appointed by the President of the Republic, and headed by

Lt. Col. Dantas Borges. Other members of this work group were:

Joaquim Ferreira Mangia, do Conselho de Politica Aduaneira Jose" Carvalho de Freitas, da Carteira de Come'rcio Exterior Arnaldo Perim, do Banco Nacional de Desenvolvimento

Econ8mico Mrio da Silva Azevedo, da Petroleo Brasileiro S/A -

Petrobrfs Lelio Telmo de Carvalho, da Comissgo do Plano do Carvao

Nacional Pe'ricles Locchi, do Sindicato das Industrias de Mate'rias-

Prima para Inseticidas e Fertilizantes Jaime Santa Rosa, do Minist'rio da Indu"stria e do Comercio

Abeilard Fernando de Castro, do Ministerio da Agricultura.

-8-

Another comprehensive report on Brazilian fertilizer was made

by a work group appointed by the Council for Development in 1958,

and headed by Alvaro Barcellos Fagundes. Other members of this

work group were:

Joaquim Ferreira Mangia Leandro Vettori Leopoldo Miguez Mario da Silva Pinto Ruy Miller de Paiva Silvio Froes de Abreu.

A third national study was conducted by the Department of

Economics of the National Bank for Economic Development (BNDE)

and its report, "The Brazilian Fertilizer Market", was published by

the Bank in February, 1963.

In addition to reports which are national in scope, the Secretaries

of Agriculture, in the various states have had work groups who have

studied the problems and possibilities attendant with increased

production and use of fertilizers in their states. As an example, one

of the most recent and comprehensive of these studies was that made

in the fall of 1963 by a work group in Sio Paulo headed by Dr. Oscar

Thompson Filho, at that time Secretary of Agriculture for Sio Paulo

and later Minister of Agriculture for Brazil.

-9-

Population - Food - Production

Brazil i6 one of the largest nations in the world. It has vast,

undeveloped land resources, but political uncertainty, lack of capital,

lack of an adequate road and railroad system, plus the remoteness of

some of its better lands, serve as restrictive forces in relation to the

development of such lands. In addition, the myth of the fertility of

virgin lands, especially in the tropics, has been generally disproven.

The new lands of the Altoplano or of Mato Grosso are not necessarily

fertile and generally will require fertilizer and agricultural limestone

to bring them to profitable levels of productivity.

Population

The 1963 population of Brazil was estimated to be 77, 500, 000

persons, and the National Census Service estimates that the population

in 1970 will be 95, 300, 000 (Table 1 and Figure 2). This represents

an average annual increase of 3. 0 percent. Further, there is a

progressive trend toward a greater proportion of the total population

in urban centers. For example, in 1953, 60 percent of Brazil's

population was classified as rural and 40 percent as urban. In 1963,

rural population had dropped to 51 percent of the total and urban

population accounted for 49 percent. By 1970 urban population is

-10-

Table 1. Estimated population of Brazil, 1953-1960 with projections to 1970 1

Year Estimated population-millions Total Rural Urban

1953 56.7 34.0 2Z.7 t

1954 58.4 34.3 24.1

1955 60.1 34.7 Z5.4

1956 62.0 35.3 26.7

1957 63.8 35.8 28.0

1958 65.7 36.3 29.4

1959 67.7 37.0 30.7

1960 71.0 39.0 32.0

1961 73.1 39.1 34.0

1962 75.3 39.3 36.0

1963 77.5 39.6 37.9

1964 79.8 39.9 39.9

1965 82.2 40.3 41.9

1966 84.7 40.8 43.9

1967 87.2 41.3 45.9

1968 89.8 41.9 47.9

1969 92.5 42.6 49.9

1970 95.3 43.5 51.8

Source: Based on data from Servico Nacional de Recenseamento and

and "Brasil, Sinopse Preliminar do Censo Demografico", 1960.

80-.

7"

70.

4

0

"

@-

1950 1954 1958 1960 1962 1964 1966 1968 1970

Figure 2. Population estimates, Brazil, urban and rural, 1953-1960 with projections to 1970

Source: Servicio Nacional de Recensamento, 1953-1960

-12

expected to comprise 54 percent of the total, with rural population

46 percent,

This growth in population together with continued urbanization of

the Brazilian population, will place an increased strain on the agri

culture of BIazil, particularly if Brazil is to maintain its current

level of agricultttral exports.

Food

Brazil is not a deficit area in terms of per capita calorie consump

tion levels. In a study by the U.S. Department of Agriculture, publish

ed in November$ 19631 , the .958 food consumption level for Brazil

was estimAted at Z, 2 caloaiesi compared to a reference standard of

2, 500 calorie., for Latin America. However, in terms of quality of

diet, there is need for l nprqcvonent in Brazil. A general indication

of dietary levels is given by ,' relative importance of grain products,

roots and tahbrs in , diet, particularly as compared to consumption

of livestock pi-ducts, fats atid oils. For example, in terms of total

calorie supply, Brazil obtained 51.8 percent from grains, roots and

tubers (of which 16.3 percent was from mandioca), and 19.0 percent

1 Brown, Lester f., Man, Land and Food, Economic Research Service, U. S, Department of Agriculture, Foreign Agricultural Economic Report No. 11, November, 1963.

-13

from fats, oils, and livestock products. The relative position of diets

in Brazil compared to other areas in the world is shown in Table 2.

These data show that in terms of the ratio of calories from grains,

roots and tubers, compared to fats, oils and livestock products, Brazil

with a ratio of 1:0. 37 is substantially below the United States (1:2. 10)

and Western Europe (1:0. 88) and is even slightly below the average

for all of Latin America (1:0.41).

Table 2. Relationship between composition of Brazilian diets and diets in other areas 1

Composition of United Latin Western total calories in diet Brazil States America Europe

Percent grains, roots and tubers 51.8 24.2 50.7 43.3

Percent fats, oils and livestock products 19.0 50.5 20.9 38.0

Ratio grains roots and tubers to fats, oils and livestock products 1:0.37 1:2. 10 1:0.41 1:0.88

1 Calculated from data obtained from Brown, Lester R., Man, Land

and Food, Economic Research Service, U.S. Department of Agriculture, Foreign Agricultural Economic Report No. 11, November, 1963.

If Brazil is to up upgrade the quality of its diet, it must eventually

divert a larger part of its agricultural resources to the livestock sector.

-14-

This will require intensification of crop production if levels of production

of these crops are to keep up with expanding demand. It is of interest

that the two countries with the highest levels of fertilizer use in the

world, the Netherlands and New Zealand, are also among the group

having the highest percentage of their diets furnished by livestock

products, fats and Oils.

If Brazil is to merely maintain its present dietary level between

1963 and 1970 it must increase food production by 23 percent. Any

improvement in dietary levels or increase in agricultural expr'rts will

require a more intensive effort toward increased production.

-15-

PRESENT AGRICULTURAL SITUATION

Agriculture continues to be the mainstay of the Brazilian economy,

although the rate of agricultural expansion has lagged behind industrial

growth in recent years. Agriculture contributed 28. 2 percent of the

national income in 1960 (table 3) and industry contributed 26.0 percent.

However, over 50 percent of the labor force was engaged in agriculture

in 1960.

Table 3. National and agricultural income, Brazil 1952-19601

Income (Cr$ billions)

Agricultural Agric. income as j0 Year National income income of National income

1952 Cr$ 293.3 Cr$ 84.9 28.9 1953 358.9 104.7 29.2 1954 455.2 135.8 29.8 1955 575.7 172.0 29.9 1956 749.0 199.3 26.6 1957 865.3 243. Z 28.1 1958 1,056.2 271.4 25.7 1959 1,418.5 384.1 27.1 1960 1,901.2 536.0 28.2

Source: Anuario Estati~'t'zo do Brasil 1

-16-

Exports -, Imports

Exports

Agricultural products account for over four-fifths of the total value

of exports of Brazil (table 4 and figure 3), and average approximately

one billion dollars annually. Exports of coffee alone account for 50 to

60 percent of the value of total exports. Shipments of cocoa amount to

approximately five percent of total exports and cotton in recent years

has accounted for eight to nine percent of the value of total exports.

Total value of exports has declined slightly in recent years, due

primarily to a decrease in value of coffee exports.

Exports of agricultural products are of critical importance to the

Brazilian economy since they represent the major source of foreign

exchange which is urgently needed for the importation of equipment and

basic raw materials (such as potash) not available in Brazil.

Imports

Imports of agricultural products into Brazil are relatively less

important, accounting for but 12 to 16 percent of total imports

(table 5 and figure 4). Wheat is the primary agricultural import,

accounting for about 10 percent of total imports and for two-thirds

of total agricultural imports.

and percent of total, 1956-19621value in U.S. dollars,Brazil,Table 4. Composition of total exports,

Cocoa Cotton Other Agr. Exports Total Agr. Exports Total ExportsCoffee

Value Percent Value Percent Value Percent Value Percent Value Percent Value Percent total millions totalmillions total millions total millions total millions total millions

Year dollars exports dollars - exports dollars exports dollars exports dollars exports dollars exports

90.5 6.1 $127.9 8.6 5132.b.7 89.5 $1482.0 100-01956 $1029.8 69.4 $ 78.5 5.2 $

47.3 3.3 172.2 12.3 1156.4 83.0 1392.0 100.01957 845.5 60.7 91.4 6.5

9.Z 28.0 Z.2 185.1 14.8 1016.0 82.3 1243.0 100.01958 687.8 55.7 115.1

6.6 36.8 2.8 206.3 16.0 1071.9 83.6 1282.0 100-.01959 743.6 58.0 85.2.

56.1 94.2 7.4 48.6 3.8 185.6 14.3 1041.1 80.3 1269.0 100.01960 71Z.7

ZZZ.6 15.8 1106.8 78.8 1403.0 100.01961 710.4 50.6 60.9 4.3 11Z.9 8.0

80.4 1214.0 100.0196Z 64Z.7 5Z.9 41.1 3.3 115.2 9.4 177.7 14.6 976.6

1 Source: Anuario Estatistico do Brasil

I

-18

1.5

1.4-

No :icuota exports

0 1.2

0.

o 0.9 01ragricultualexports

0.6

1/ Sorce:Anuaio

0.8

k 0.

0.37

0.5

0.104

otal eprt

Etatitic do Bricl

Yea

Bal CCoffe v e Coffee

U or 9 6

Figure

1956 1957 1958

3 . Composition of total exports,

1959

Year

Brazil,

1960

value in U.S.

1961

dollars,

1962

1956- 19621

1/ Source: Anuario Estatistico do Brasil

-19-

Brazil, 1956-196Z 1

Table 5. Agricultural imports and total imports,

Wheat & Flour Total Agr. Imports Total Imports

Value Percent of Value Percent of Value Percent of

millions total millions total millions total

dollars imports U.S. dollars importsYear U.S. dollars imports U.S.

1'956 $115.3 9.3 $186.7 15.1 $1,234 100.0

1957 107.6 7.6 18Z.7 12.2 1,489 100.0

1958 116.2 8.6 160.9 11.8 1,353 100.0

1959 131.9 9.5 12.7174.7 1,374 100.0

1960 142.7 9.7 192.6 13.1 1,462 100.0

1961 139.5 9.5 193.3 13.2 1,460 100.0

1962 161.6 10.9 235.2 15.9 1,475 100.0

I Source: Anuario Estatistico do Brasil

-20

1.5

1.4 Total imports

S1.1

01.0

0. 9 -Nona ricultural i ports

0.8

m 0.70

40.6

.4 0 0

1-4

0. 2 Total gricultural imports Other agricultura imports

Im :orts of wheat

1956 1957 1958 1959 1960 1961 1962 Year

Figure 4. Agricultural imports and total imports, Brazil, 1956-19621/

1/ Source: Anuario Estatistico do Brasil

-21 -

In contrast to exports, which have declined in total value, the

value of imports has risen slightly but steadily since 1956.

Farm Organization and Operation

Brazilian agriculture is a mixture of both the old and the new.

Farmers in some areas, particularly the central south, are progressive

managers who use modern cultivation practices, fertilizers, and other

advanced farming procedures. In contrast to this, many subsistence

farmers still practice slash and burn agricultural techniques using

hand implements or oxen. Farmers in Brazil generally have little or

thus limiting their ability to accept and assimilateno formal education,

new technology.

There were 3,349,400 farms reported in the 1960 census. The

farms, by size of holdings, is showndistribution of farms and area in

in table 6. Over 88 percent of the farms are less than 100 hectares in

size, yet this 88 percent of the farms accounts for only 20 percent of

the total farmland. Farms of 10,000 hectares or more account for

only one-tenth of one percent of the farms but 19.8 percent of the farm

land. By far the largest proportion of the farms are occupied by owner-

However, many of these are hardly more than subsistenceoperators.

farms.

-2Z -

Number of farms and area of farmland, by farm size, 19601Table 6.

Farms Farmland Number Percent of Area Percent of

Size (hectares) (thousands) total number (thousands total area of hectares)

Less than 10 1,499.5 44.76 5o923.1 2.23 10to 100 1,494.5 44.63 47,697.8 17.97 100 to 1000 315.1 9.41 86,291.9 32.51 l,O00to 10,000 31.2 .93 72s794.5 27.42 10,000 oi more 1.7 .05 52,743.4 19.87 Size uncertain 7.4 .22

Total 3,349.4 100.00 265,450.7 100.00

Source: Anuario Estatistico do Brasil, 1963.

Agricultural Production

The increased agricultural production required by Brazil's

expanding population and export trade can be met in two general ways

(1) increased land in agriculture, or (2) increased productivity on

existing lands.

Land

Brazil has large areas of land which can be brought into agricultural

production - at a cost and over time. A projection of past trends in

land development indicates an increase in!cultivated hectares from

28.5 million hectares in 1962 to 35.5 million R, 197G, a gain of nearly

25 percent (figure 5)j Much of this area lies in the Planalto Central

and further west and north in Mato Grosso. Although the soils of these

areas vary, they have two common characteristics, acidity and a

relatively low inherent fertility. The use of fertilizers and agricultural

limestone iA a prerequisite to sucessful farming in the area. This

conclusion is reinforced by a study of the Planalto made by the American

International Associdtion in which they concluded that the development

of this area was dependent on the establishment of a domestic fertilizer

industry capable of supplying the demands of an industrialized

1 agriculture.

Intensification

onThe second alternative, increased productivity existing lands,

demands increased intensification of farming methods, increased

There is a directfertilization being perhaps the most important.

and levels of crop production.relationship between fertilizer use

Figure 6, from the Food and Agriculture Organization, United Nations

shows this relationship and also shows that Brazil ranks in the lower

averagethird in fertilizer use among the 41 countries studied. As an

over the period 1956-1958, Brazil used only an estimated 8.5 kilograms

1 "Survey of the Agricultural Potential of the Central Plateau of Brazil,"

a report of the American International Association under U.S. Contract

AID-12-1Z0, March, 1963.

40

35 35.5

, 30

0

z5

~)20

U J 15

10

51

1953 1954 1955 1956 1957 1958 1959 1960 1961 1962 1963 1964 1965 1966 1967 1968 1969 1970

Year

Figure 5 . Total hectares grown, principal crops, Brazil, 1953-1962, with projections to 1970

VALUE -

INDEX S New ZealOWn

400

3009

300 .3 .3!3

/'.

0 50 100 150 200 250 300 .350 400 450 50

FERTILIZER USE

1. Butrma 8. Indonesia 15. South Africa 22. Australia 29. France 36. Switzerland 2. Argentina 9. Philippines 16. Yugoslavia 23. Italy 30. Austria 37. West Germany 3. Thailand 10. Canado 17. Spain 24. Peru 31. South Korea 38. Japan

4. Pakistan 11. Colomabia 18. Greece 25. Egypt 32. Denamark 39. Belgiunm Luxemabourg S. Turkey 12. Mexica 19. U. S. A. 26. Finland 33. United Kingdoma 40. Netherlands1%6. India 13. Braoil 20. Portugal 27. Israel 34. Norway 41. New Zealand 7. Syria 14. Chile 21. Ceylan 28. Sweden 35. Taiwan

Figure 6. Curve of average relationship between fertilizer use and value index of crop production

(Per Arable Hectare 41 Countries, 1956-58)

SOUREE M4.S. tWILLIAMS$ AND J1.a. COUSTON. CROP PRODUCTION LE VELS AND

FERTILIZER USE. FAG. ROurE. 19AS.

-26

of commercial fertilizer per hectare of arable land, compared to

30. 9 kilograms for the United States and approximately 450 kilograms

for the Netherlands and New Zealand. Yields in the United States

averaged approximately double those in Brazil and yields in the

Netherlands and New Zealand were four times those in Brazil.

Why Most Brazilian Farmers Do Not Use Commercial Fertilizer

More than 95 percent of Brazilian farmers do not use commercial

fertilizer. Enough fertilizer is used to adequately fertilize only eight

percent of Brazil's cultivated land. Of the mineral elements removed

by the harvested crops not over 12 percent is replaced by fertilizer.

Moreover, essentially no fertilizer is applied to the vast pasture areas

of Brazil which supply most of the feed for approximately 60 million

head of cattle and 20 million head of sheep.

Farmers do not utilize fertilizer for many reasons, good reasons.

Two of these reasons were mentioned in the 1957 fertilizer study,

Fertilizantes no Brasil.

1. Ignorance of the advantage of fertilizer.

2. Unfavorable relation between the price of fertilizer and the

price of agricultural products.

Unfortunately, both of these reasons still were operating in 1964.

In addition to the foregoing, a number of other reasons have been

-27

mentioned, in certain aspects overlapping, but in the sum total of

which is seen a picture of the obstacles that stand in the way of a

broad expansion in the use of fertilizer.

3. Misinformation. Much of the early research was based upon

an incomplete application of fertilizer. Often only one or two or

three elements were added, when the limiting factor may have been

lime or some other element. Responses were not obtained, hence

the application of fertilizer was not recommended.

Farmers are afraid minerals will kill organic organisms in

the soil and have to be convinced in favor of chemicals. Professor

Walter Lazzarini, Piracicaba, remarked that "The Instituto

Agronomico was established 75 years ago but until 1955 it

recommended only organic fertilizer. In 1958 the results of Bra

zilian experiments showed conclusively that mineral fertilization

could replace organic fertilization. It was difficult to convince

even the technicians of this fact."

4. Information unavailable. Successful results from research are

often buried in governmental files rather than distributed to those

who could benefit by them.

5. Ineffective fertilizer application. Farmers and research people

often were discouraged in the first application. Very frequently,

the farmer applied the fertilizerwithout experience or direction,

-28

by an ineffective method, in inadequate quantity at the wrong time,

or used the wrong fertilizer. Even the research worker, in one

specific instance of which we have evidence, spread lime on the

surface of the ground at planting time. This gave unfavorable

response while, had the lime been applied some months earlier

and incorporated in the soil, the result might have been very

different. A small amount of lime or phosphate or nitrogen often

shows no result while larger amounts are effective. The farmer

may have put on elements that did not include the limiting factor

followed by his decision against use of fertilizer.

6. Cost-tax problems. The farmer is unable to deduct the cost of

fertilizer before paying his taxes. Taxes in Brazil have in sub

stantial part been collected by exchange rate manipulation. By

this device the farmer is taxed not only on the return for his

labor but also on his cash outlay.

7. Leasing and tenure problems. The farmer-tenant on the land

probably will not use fertilizer without the assistance of the land

lord because ordinarily he operates for something like half of the

crop. Half of the increased return for fertilizer would probably

not encourage him to make the cash outlay required.

8. Middlemen's margins. The use of fertilizer is discouraged

by the system of marketing that channels profits into the hands of

the middlemen and processors.

-Z9

9. Fertilizers unavailable. Very often fertilizers are not avail

able when needed.

10, Lack of understanding regarding fertilizer use. There is a

lack of understanding as to what fertilizer to apply and how to

apply it.

11. Lack of adequate financing. There is a lack of a scheme for

paying for the fertilizer or financing its purchase. Bonifacio

Carvalho Bernardes, Director of the Rice Experiment Station of

Gravatai (64), points out that the use of fertilizers and correctives

on rice in Rio Grande do Sul has been minimized by insufficient

financing by the Banco do Brasil.

12. Illiteracy. Farmers cannot read the results of research.

Reports are too complicated.

13. Minor element mixes unavailable. Mixed fertilizers that

include essential minor elements simply are not available any

where in Brazil.

14. New lands available. Shifting to new land has required only

outlay of labor, no cash outlay. Farmers follow this practice as

long as they have access to new land and to cheap labor.

15. Primitive farming methods. Use of fertilizer does not fit in

well with the man-powered agriculture of Brazil back country.

Fertilizer comes as a part of the machine age where lime is plowed

-30

under or mixed with the soil, nitrogen is placed below or near the

seed and later a supplemental application is drilled into the soil.

Fertilizer pays, or pays best, with modern cultivation practices,

weed and insect control and with application in the right amount,

in the right spot and at the right time.

During the past decade, however, fertilizer consumption has

increased rapidly, particularly on export crops. Also in the advanced

farming areas such as Sao Paulo, Parana and Rio Grande do Sul new

lands are becoming less available forcing farmers to fertilize rather

than move to new land.

About 75 percent of the commerical fertilizer used in recent years

has been applied in the State of Sao Paulo. Sao Paulo is the center of

chemical fertilizer production in Brazil and of more advanced agri

culture. Other States in the South are also using increasing quantities

of fertilizer. Fertilizer consumption in the East and Northeast is still

insignificant compared to other areas.

Only limited quantities of lime are used despite the acidity of

many soils in Brazil.

Crops and Livestock

Crops accounted for 65 percent of the total value of agricultural

Livestock and livestock products accounted forproduction in 1959.

about 29 percent and forest products for about 6 percent. The broad

-31

range of climatic conditions for Brazil provide favorable conditions to

the production of nearly all tropical, semitropical and temperate zone

plant life.

Ten crops accounted for 85. 7 percent of the total area planted to

permanent and temporary crops in 1962 (figure 7). These major crops

and the number of hectares planted in 1962 were as follows:

Beans 2,716,257 hectares

Cocoa 464,762 hectares Coffee 4,462,657 hectares Corn 7,342, 795 hectares Cotton 3,457,859 hectares Potatoes 196, 198 hectares Rice 3,349,810 hectares Sugar cane 1,466, 619 hectares Tobacco 23ZZ97 hectares Wheat 743, 458 hectares

Table 7 shows an increase from 19.6 million hectares in 1953 to 28.5

million hectares in 196Z for the principal temporary and permanent

crops grown in Brazil. A linear projection of this trend indicates that

the total area planted to temporary and permanent crops will be 35.5

million hectares by 1970 (figure 5). This represents an average annual

increase of slightly over 3 percent.

Besides the major crops listed above there are a wide variety of

fruits, vegetables and other crops that are produced commercially and

for home consumption. Another crop of importance in many areas for

both human and livestock consumption is mandioca. About 1. 5 million

hectares of mandioca were grown in 1962.

-3Z-

Brazil, 1953-19621Tutal hectares grown, principal crops,Table 7.

Year Temporary Crops Permanent Crops Total Crops

1953 15,941,084 3,724,315 19,665,399

1954 17,103,093 3,840,589 20,943,682

1955 17,717,367 4,159,723 21,877,090

1956 18,444,733 4,347,029 22,791,762

1957 18,664,733 4,637,975 23,302,708

1958 18,518,918 5,183,974 Z3,702,892

1959 19,320,617 5,452,150 24,772,767

1960 20,751,426 5,618,995 26,370,421

1961 21,700,946 5,627,721 27,328,667

1962 22,761,995 5,744,106 28,506,101

1 Source: Anuario Estatistico do Brasil

-33-

C 0

r

n

7

6

5

C 0 f f e e C

0

t

h e r C r

Uc a)

4

-

0

t o0

R i

e B e

0

p

s

.1-4

1a

a n

M

a n d

0 c

a

u

g a r

C a nl

e w h e

t

0. Crop

Figure 7. Planted hectares of principal crops, Brazil, 1962

Source: Anuario Estatistico do Brazil.

-34-

During 1953-62, the weighted aggregate production index for the

ten major crops rose by 160 percent, the hectares grown tidex rose by

41 percent and the yield index rose by 60 percent (table 8 and

figure 8).

Beans

Brazil is the world's largest producer of edible beans, a principal

staple in the Brazilian diet. The major bean producing states, Parana,

Minas Gerais, Rio Grande do Sul, Sao Paulo and Ceara, contributed

60.7 percent of the total bean production in 1962. These five states

also accounted for 59.2 percent of the total area planted to beans

(figure 9). The area planted to beans, in Brazil, increased by about

700,000 hectares between 1953 and 1962 or an increase of 35 percent.

A projection of this trend indicates that by 1970 total area planted to

beans will be about three million hectares (figure 19). Total produc

tion of beans increased by 23 percent between 1953-62 and yields have

actually decreased slightly during the same period (figure 22).

Cocoa

Cocoa, although it is one of the major agricultural exports, is

not widely grown in Brazil. In 1962, cocoa exports were valued at

14. 1 million dollars and accounted for 3. 3 percent of the value of total

exports. The only major cocoa producing state is Bahia, accounting

for 93.7 percent of the total cultivated area and 94. 3 percent of the

total national production in 1962 (figure 10).

-35-

Table 8. Brazil, weighted aggregate indexes of planted jectares, yield and production, principal crops, 1953-1962

Index (Aug. 1953-1962 - 100)

Year Hectares grown Yield per hectare Total production

1953 83 78 58

1954 87 84 69

1955 92 91 78

1956 94 84 82

1957 98 95 95

1958 99 95 86

1121959 104 108

1960 110 116 128

123 1401961 113

1962 117 125 151

I Crops included are: beans, cocoa, coffee, corn, cotton, potatoes, rice, sugar cane, tobacco, wheat.

140

-36-

Yield Hectares Production

44 o 13u

2 2 120

Ll 110

100

.2 100

90

>

-37-

Coffee

Coffee is Brazil's largest single export commodity and from the

standpoint of value is the principal agricultural crop produced. In

1962, coffee exports were valued at 642.7 million dollars and accounted

for 52.9 percent of the total value of all exports. Two states, Parana

and Sao Paulo, are the major producers of coffee accounting for 75. 5

percent of total production in 1962 (figure 11). Total area planted to

coffee since 1958 has remained fairly stable (figure 20). Average yields

of coffee increased substantially between 1953 and 1959. However,

between 1959 and 1962 the average yield was rather stable (figure 22)

as was total production of coffee.

Corn

From the standpoint of area planted, corn is the principal crop

grown in Brazil, accounting for over one-fourth of the land planted to

temporary and permanent crops. Total corn production has increased

from 6.0 million metric tons in 1953 to 9.6 million tons in 1962. This

is an increase of 60 percent. During the same period, the area of corn

cultivated increased by 43 percent (figure 20), and the yields increased

11 percent (figure 23). The major corn producing states, Rio Grande do

Sul, Minas Gerais, Sao Paulo and Parana, produced 7Z. 4 percent of the

total national production in 1962 and accounted for 65.7 percent of the

planted hectares (figure 12).

38 AgL~OLASSO

LASAIVIAt

---,----- .'L ,

im

fli-I :P . ., '.KVkI.. "' ' . Q

S "h... Total Brazil I

AM -.. , 464, 76Z hectare.

- gu,-. -I.

... ImAN Figccre 10, Cocoa, hectarts growcn. by state, 1962 Eath dot equals 1, 000 hectaresTotal Brazil e 76

*Leon than 1,000 hectares grown

Figgur hecthetares grown, by state.19. Corn

I c t eh

E ach d ot e qu al s , 00ahecta . .d

. .. ..,, ,..,.... .z ?.......oo ..UUM,.."AUI

._'J,.,. , O"1,4

. , .,,.........,...

*Less than 10, 000 hectaresgrw

ch d e u l 0 0 0 e t r s' BrazilulEO fTotal 4,~~~ ~ 7, 342.s he,00heta th9nhocNMe U6.164

Auro Figur 1ofa. hectares grwn byostae, 96W heotrre

Each dot equals 10, 000 hectares *Laos than 10. 000 hectares grown

s s tha 0 00 hectres row

igure 15RIce, hecta n a

Total ~ ~ "'' ~ll ~ Tta Brrazil;:

Figure~~3 grown, 457. 859teshectares . . . Le. than ,. 00hertare. gro.n saitted1

Fiue4 ttos h..aesgrwn.b sat. 96 Eachueuas0,000hetae do

39 mudI aI e ,thao100 hectares

e~ess hanl,000 hetare00 rll

Each~ ~e"all0,00leta ~do ~ Is

14110 OWO

Figure 13.\iCoton hectares grown. by state, 1962

Each dot equals 10, 000 hectares

N-Less than 10, 000 hectares grown

40

AM ull aim

Total Brazil

|,m.466, 619 hectares -- .. ''---

I-wo

............ k

FONI .,,,... ,:,. ., Figure.. Figur 16

S rCaeetae.,Suga Cane hecare

rwn? grwn

ysat,16tby"stte16

Each dot equals 10.000 hectares *L"e than 10, 000 hectares grown

Total Brazil

FigueFigure

.Less

1.

.Each

.:~;,.,'. Aseat

Wat , hectare

*wu

grown,by tae 196

dot equals 0, 000 hectta.. than 0, 000 hectaes grown ....

EachdotequlxI 00 hetar zil 73 45ss hecarnhetaesgrwn A, 00l

TotalBraziWill/

Figure 18. Wheat, hectare@ grown, by state. 1962

Each dot equals 10, 000 hectares * Less than 10, 000 hectares grown

41

Beans Sugar Cane

- Wheat

0

Z.

- .o&to

Z.0

1953 1954 1955 1956 1957 1958 19S9 1960 1961 1962 1963 1964 1965 1966 1967 1968 1969 1970

Coffs: Figure 19. renCorndtHectare. grown. bean., potatoee,

ay o r sugar can@. and wheat, 1953-196Z with projection. to 1970

.... Cotton sks . . .Rice ...

8.--0|

rea

year

0.

19315 9597 16 9 1 19 4 193 196 165 166 196 1$968 Z 9) 194 1969 1970 15 15 99

YearY6a3

Figure~ur grown.20. cofe.oorooto Hectares rcBai,15-92wt and rjcin to co ,1S316 wthpoeton o171970

yield - . pee et..

- I_ / I

- Yild- e hctr

Yield - tospee hecedt

.0

., S

C..pe

-

bt?,

m

-; I * +' 4

-

II "-,

.

_ _ __ _

tI

I

_

_ \_

I_

I

_ _

a _ I _ _

-43-

C otton

one of Brazil's major agricultural exports. In 1962,Cotton is also

valued at 115. Z million dollars and accounted forcotton exports were

9.4 percent of the value of all exports. The total area planted to cotton

leveled off between 1956 and 1960. However, since 1960 the area of

The increase incultivated cotton has inczeased rapidly (figure 20).

area of cultivated cotton in recent years has stemmed largely from

increased domestic demand and from Government policies designed to

Average yields of cotton have generallyexpand cotton production.

increase 1 since 1953 (figure Z3). Large gains in yield have been real

ized in the south while areas of the northeast and north show constant

61. 2 percent, of theand in some cases decreasing yields. The bulk,

area planted to cotton is found in the northeast (figure 13). Sao Paulo

account for 27.0 percent of the planted area.and Parana, in the south,

However, in terms of production Sao Paulo and Parana produced 54. 2

percent of the total in 1962 and the northeast only 35. 1 percent. This

stems from a number of factors, the main ones beingdifference

cultural practices and rainfall.variety of cotton grown,

Potatoes

southern states.Potato production in Brazil is located mainly in the

do Sul and Parana accounted for 78.5 percent of Sao Paulo, Rio Grande

the total production in 196Z and 7Z. 4 percent of area planted to potatoes

(figure 14). Total national production of potatoes has been relatively

-44

stable with only a 13.0 percent increase between 1956 and 1962. During

the same period the area planted to potatoes has increased 6 percent

(figure 19) and yields increased 7 percent (figure 24).

Rice

Brazil is the largest producer and consumer of rice in the Western

Hemisphere. In 1962, 5. 5 million metric tons of rice were produced

in Brazil. This is 65.0 percent more production than in 195 3. Total

area planted to rice increased from 2. 10 million hectares in 1953 to

3. 34 million hectares in 1962, an increase of 60 percent (figure 20).

Average yields of rice between 1953 and 1962 increased from 1.48

metric tons per hectare to 1.66 tons per hectare. The estimated

average yield for 1970 is 1.90 metric tons per hectare (figure Z3).

Rio Grande do Sul is the largest rice producing state accounting for

21. 0 percent of total production on 12 percent of the area planted in

1962 (figure 15). Sao Paulo and Minas Gerais accounted for 32.1

percent of production and 36.3 percent of the planted hectares. The

high production in Rio Grande do Sul is due to the fact that most of the

rice in that state is irrigated while the rice in Sao Paulo and Minas

Gerais is of the dry land variety.

Sugar Cane

Sugar cane production since 1953 has increased from 38.3 million

tons to 62. 5 million tons in 1962 and next to coffee has the greatest

potential as an export item. Exports of sugar accounted for

-45

65. 5 million dollars or about 5. 3 percent of the total value of all exports.

The states of Sao Paulo and Pernambuco produced 51.0 percent of the

productg-n in 1962 and accounted for 46.6 percent of the hectares

planted (figure 16). Rio de Janeiro, Minas Gerais, Bahia, Alagoas

and Paraiba produced another 31.6 percent. The large increase in

production between 1953 and 1962 was accomplished mainly by

increasing the cultivated area (48 percent) rather than from increases

in yield (only 10 percent).

Tobacco

Total production of tobacco increased from 132.1 thousand metric

tons in 1953 to 187.0 thousand tons in 1962. During the same period

total area planted to tobacco i.ncreased slightly (figure 21). Yields,

however, held about constant (figure 22). Rio Grande do Sul is the

largest tobacco producing state with 30. 4 percent of the planted

hectares (figure 17) and 35. 5 percent of total production. The next

two largest producers are Bahia and Minas Gerais with 36. 6 percent

of the cultivated tobacco area and 29. 4 percent of total production.

Brazil consumed about 74 percent of its tobacco production in 1962

and exported about 26 percent.

Wheat

Wheat and wheat flour are the most important Brazilian agricultural

imports, accounting for 161.6 million dollars in 1962. This is 68.7

percent of the value of agricultural imports and 10.9 percent of the

-46

value of total imports. Rio Grande do Sul is the only important wheat

producing state in Brazil with 73.8 percent of total production in 196Z

and 72.9 percent of the area planted (figure 18). Santa Catarina

ranked second in production with 14. 9 percent of the total. Both total

production and area planted to wheat have decreased since the mid

1950's (figure 19). Average yields, however, have been generally

increasing (figure 23). Decreases in production reflect insect,

disease and variety problems as well as the fact that farmers in Rio

Grande do Sul find livestock raising more profitable.

Livestock Production

Brazil is an important livestock producing country and ranks in

the top five on a world basis in numbers of cattle and hogs. Exports

of animal products were valued at a total of 30. 4 million dollars in

1962. The production of all kinds of livestock has increased since

World War II, particularly in the number of hogs, poultry and dairy

cattle (figure 25). The raising of cattle, goats and sheep is based

mainly on extensive operations, with little or no feed other than grass.

Widespread animal diseases and parasitic infestations are a serious

problem of the livestock industry, and nutritional deficiencies

as well as to problems ofcontribute to the high incidence of disease

reproduction and growth.

- -

----- ---------------

260 ... All poultry

All cattle Swine

240 . .Sheep

.-.. Horses & mules

220

o2 00 ""~au

0 2 180 .... I-'**

data not available 160 prior to 1957 .

1006

44

0 10

80 z 60

40 -4

20 _.,...,_- -- ... ........ -------...... i-..... ......-EI 1

1953 195t 1955 1956 1957 1958 1959 1960 1961 1962 1963 1964 1965 1966 1967 1968 1969 1970 Year

Figure 25. Livestock and poultry, Brazil, numbers, 1953-1962 with projections to 1970

-48-

Cattle

The number of cattle in Brazil reached a reported 79. 1 million

head in 1962, 1 an increase of 73.7 percent over the 1952-54 average

(appendix table B 31). Nearly 75 percent of the cattle are in the states

of Minas Gerais, Sao Paulo, Mato Grasso, Rio Grande do Sul and

Cattle raising moved steadily westward as the moreGoias (figure 26).

accessibe land increased in value and was planted to crops. In some

areas, particularly Sao Paulo and Minas Gerais, cattle raising has

shifted back to land that has become exhausted or badly eroded.

Disease and nutritional problems, especially lack of minerals,

seriously affect the cattle industry. Calving rates are often below

50 percent and the growth rate is slow with cattle often being 4-5 years

of age before reaching market.

Hogs

Brazil is the largest producer of hogs in Latin America. In 1962,

hog numbers had reached 52.9 million head, an increase of 62.3 percent

over the 1952-54 average (appendix table B 32). Hogs are raised largely

toby small farmers in the corn producing areas from Minas Gerais

The 79. 1 million head is the number reported in the Anuario

However, the same publication also reportsEstatistico do Brasil.

only 55.7 head as based on the 1960 census. The 79.1 figure is

apparently a projection of the 1950 census and has not been

readjusted to the 1960 census base.

-49 -

Rio Grande do Sul (figure 27). The states of Minas Gerais, Parana,

Sao Paulo, Santa Caterina and Rio Grande do Sul accounted for 60

percent of the hog production in Brazil in 1962. Generally, hog rations

are poorly balanced. Corn is fed and mandioca roots are also a major

source of feed in some areas. Protein supplements and minerals are

fed when available, but they are usually lacking in most ho- rations.

Sheep and Goats

The climate in Brazil is not well adapted to shfp production

except in Rio Grande do Sul. This accounts for the fact that over half

of the 19.7 million head in 1962 were found in that state (appendix

table B 33 and figure 28). Most of the remaining Eheep are raised in

Bahia and in the Northeast by small subsistence farmers, primarily

for meat. On the large ranches in Rio Grande do Sul sheep are

raised primarily for wool. The number of goats in 1962 totaled

12. 3 million (appendix table B 34) with almost 60 percent being

raised in the four northeastern states of Bahia, Piaui, Ceara and

Pernambuco.

Horses, Mules and Asses

The number of draft animals in Brazil still shows an increasing

trend. The number of draft animals in 1962 was estimated at 15.5

,million head (appendix table B 35). This is 28 percent more than in

About 50 percent of the draft animals are located in the states1952.

Sao Paulo and Rio Grande do Sul (figure 29).of Minas Gerais, Bahia,

50 Mt

Fit;

. i * vi.... - +

.

Alre Awer

. *... . . pM

AWOKUi ,

otai le. 7'1. 078, 0000held

. ."

? tignrM.ikpo a tini rzl u b rb tt,1b

Eac-leet tIt

d ustatl

* * A*u.'

. .

ot equals 100, 000

to

-, C u ,;n

o q .0, 00 0 tai

hea s00lest0010 0

i'.

- kgureFigurett,19622 o ae. 2. populatio n Brazil, tnumberebynstate,

5Z19, 71, 000 head

V.. FigureBrrazil, population in

EEach -Equalse less

Sheepnumber by stale, 196

dot equal 100, 000 head thean100, 000

51

.. .*o ..

-52-

Most of these animals are small, rugged types. Some more highly

are found in the South where climate and pasture conditionsbred horses

are more favorable to their growth.

Poultry

The poultry industry in Brazil has shown a considerable expansion

in recent years as the result of the commercial development of broiler

and egg production. The chicken population of 197.8 million in 1962

25.8 percent increase over 1957 (appendix tables B 36 and B 37). was a

The largest chicken-producing states, Sao Paulo, Minas Gerais and

Parana accounted for over 50 percent of the poultry production in 196Z

(appendix table B 36 and figure 30). Total water fowl production was

6.7 million in 1962, up 1. 2 million from 1957 (appendix table B 38).

Turkey production in 1962 was 3. Z million birds compared to 2. 5

million in 1957 (appendix table B 39).

-53-

DEMAND REQUIREMENTS FOR FERTILIZERS

Basic fertilizer requirements for Brazilian crops under present

and projected production conditions can be calculated under a number

of different criteria. Crop requirements for nitrogen (N), phosphorous

(P 2 0 5 ), and potassium (K 2 0), for this study were calculated under the

following criteria:

I. The trend of consumption of the principal plant nutrients

would continue at the same rate as that existing during the

period 1950-1963.

Z. Fertilizer requirements w