Agribusiness is Bad for Brazil and Brazilians

 Agribusiness is Bad for Brazil 
  and Brazilians

If Brazil wanted to
solve the problems of unemployment and poverty
in the rural areas it would be by land reform, which is the
democratization of the ownership of land. If there is no change,
we will continue having a minority earning lots of dollars,
poverty on the rise, and the government making empty speeches.
by: João
Pedro Stédile

The press deifies agribusiness, without pointing out that it employs only
half a million people. Since the Lula government took office, the Brazilian
press, strangely enough, has unanimously dedicated itself every day to singing
the praises of agribusiness.

Why this unified ongoing
campaign right now? One of the explanations could be the growing influence
of neoliberals in the Lula government, represented by the Ministries of Agriculture,
or rather of Agricultural Export, and of Industry and of Health and in the
economic area.

Another explanation can
be an attempt to stop the government from carrying out a massive land reform.
And so they preach that the only way to resolve the problems of poverty and
unemployment in the rural area would be the agribusiness model.

The fact is that the poverty,
unemployment and social inequality that exist in the Brazilian countryside
are precisely the fruits of the 500 years of an agrarian model that gives
priority to exports ever since the arrival of the Europeans and their interests.

Twenty Million Without

The Brazilian press, monopolized
by seven groups and clearly tied to the interests of the large landowners
and transnational exporters of raw materials, carries out their role of making

Every day they show new
farm machinery, carrier ships, and indexes of farm exports as if they were
synonymous with economic and social solutions. And they hide the fact that
in the Brazilian countryside we have 30 million who live in conditions of
absolute poverty, that 20 million have never put on a pair of shoes, that
50 million Brazilians go hungry every day. That 30 million don’t even have

They forget to show that
only 8 percent of the population goes to the university and that in the Northeast,
60 percent of the rural population is still illiterate. They forget to say
that in the country with the largest agricultural border in the world there
exist 4.5 million families of landless workers.

Which of these problems
are solved by the model of agribusiness? Not one. On the contrary, it’s exactly
this model that creates so much inequality, poverty, and unemployment. Because
the agribusiness model is organized to produce dollars and products that interest
Europeans and Asians, not Brazilians.

And for this reason they
do not produce food, jobs, or social justice. Agribusiness is concentrated.
It takes the wealth produced here out of the country, instead of distributing

But I wanted to take advantage
of your patience to show that even from the logical point of view of national
capitalism, the agribusiness model is irrational, or, if you wish, stupid.
Or rather that this model is only of interest to international capital and
not even to the development of Brazilian capitalism.

Let’s go to the statistical
data to see the results of this agrarian model that is praised in song and
verse. Brazil has approximately 350 million hectares that can be cultivated,
that could be dedicated to farming. And this area that can be cultivated has
remained stable since 1985.

The modern agribusiness
farms occupy 75 percent of this cultivated area, the best lands, to produce
only soy, cotton, cacao, oranges, coffee, sugar cane, and eucalyptus. That’s
what interests the foreign market. Imagine if the Brazilian people had to
put only these products on their tables!

And another group of farms
that constitute this model, even worse yet, are dedicated to extensive ranching
or to using income from the land for speculation.

According to data from
Incra (Instituto Nacional de Colonização e Reforma Agrária—Land
Reform and Settlement Institute), based on statements by the owners, there
are 54,761 rural properties in Brazil that are classified as "large unproductive
properties" (which however cannot be expropriated) that together make
up no less than 120 million hectares (the size of all of Europe).

The Fallacy of Modernity

The National Plan for
Land Reform divided all the existing properties into small (up to 200 hectares
on average), medium (from 200 to 2,000 hectares) and large (above 2,000 hectares).
And afterwards it analyzed the behavior of the production factors in relation
to each sector.

In relation to employment,
the small property gave work to 14 million people, the medium to 1.8 million,
and the large agribusiness property to only 500,000. The famous modernity
of capitalism is a fallacy. 63 percent of the entire fleet of Brazilian tractors
is used by properties under 200 hectares.

And the properties over
1,000 hectares own only 36 percent of the tractors. That is to say, the so-called
"modern" property does not even stimulate the national industry
of tractors. For this reason, the demand for tractors has not grown in 25
years. The industry is selling around 50,000 tractors a year while at the
beginning of the 1960s it was selling 65,000.

But when the time comes
to use rural credit from the official banks with public resources and special
interest rates, the different interests can also be seen.

In the last harvest (2003/04),
the small property had access to US$ 1 billion (3 billion reais) and the medium
and large properties, US$ 8 billion (24 billion reais) from the Banco do Brasil.
And what is worse, just the 10 transnational corporations tied to agribusiness
picked up US$ 1.3 billion (4 billion reais) of public Brazilian money.

Ten transnational corporations
had access to more credit than all the four million families of small farmers.
And there are still people who believe that the transnational corporations
come here to apply foreign capital. On the contrary, they come to access our
national treasury! We are financing these foreign corporations and the press
is applauding.

In terms of production
results, according to the IBGE (Instituto Brasileiro de Geografia e Estatística—Brazilian
Institute of Geography and Statistic), the large property represents only
13.6 percent of all of production. Medium properties represent 29.6 percent.
And 56.6 percent of all farm production comes from family farms.

In the branches of production,
the interests that each segment defends can be seen even more clearly. Even
in animal production, the small property represents 60 percent of all of production
in milk, hogs, and poultry.

On the question of rural
wage-earners, the symbol of capitalism, the medium-sized property gives employment
to one million people, the large property to only half a million. And even
being family property, the small property gives employment to almost one million
rural wage earners besides its own families.

Misalignment Comes
From Colonial Times

Brazil has been a victim
of this policy of encouraging farm exports ever since colonialism. And everyone
knows that not a single country was developed with this model. Even in terms
of export, the country earns when it exports merchandise from an industrial
source with a high aggregate value.

And for this reason Embraer
alone, with its exports of aircraft, represents half the value of the entire
export of soy! No country develops itself exporting raw materials.

And in the Brazilian case,
it’s even worse because the ones who earn money from exports are the transnationals
like Monsanto, Cargill, Bunge, ADM, which control worldwide farm trade. They
have an average profit of 28 percent over the export value, without producing
a single grain.

If Brazil wanted to resolve
the problems of unemployment, poverty in the rural areas, and social inequality,
it would certainly not be along the path of agribusiness. It would be by land
reform, which is the democratization of the ownership of land. By the organization
of farm production through family farming, directing production toward food
destined for the internal market, for the people.

If all the Brazilian people
had enough income to eat well, there would be a national demand infinitely
superior to what is exported today. The solution is to create the conditions
for the people to buy food.

If the policy does not
change, we will continue having a minority earning lots of dollars, poverty
on the rise, and the government making speeches to say that it is going to
raise family stipends (the "bolsa") to take care of the starving,
who will continue to increase.

Until one day when the
accumulation of these contradictions will create a genuinely new policy.

This article appeared
originally in the magazine Caros Amigos –

João Pedro Stédile is an economist graduated from PUC-RS (Pontifícia
Universidade Católica do Rio Grande do Sul) with post graduation
in Mexico. He is a leader of the MST (Movimento dos Trabalhadores Sem Terra—Landless
Workers’ Movement) and of Via Campesina Brasil.
You may contact the
MST at

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