Geraldo B. Martha Jr, Elisio Contini and Eliseu Alves1 12.1 INTRODUCTION Brazilian agriculture is a success story. The country that until the 1960s systematically received food donations from abroad, and up to the 1980s was still a large food importer, had its agriculture profoundly changed. The traditional agriculture that prevailed in Brazil until the 1970s was progressively transformed in the following decades into a modern and highly competitive agriculture based on science. Along with this structural transformation in the primary sector, the industry and service sectors directly linked to agriculture also became two of the world’s biggest and most competitive. Furthermore, as food production increased at higher rates than food demand over time, food prices decreased.2 These gains in consumer surplus took place due partially to lower income for Brazilian farmers.3 Brazil is now recognized as the sole agricultural power in the tropics.4 According to recent estimates, on a country basis, Brazil’s share in world agricultural markets (8 percent) is only second to that of the United States (17 percent) (Liapis, 2010) and some analysts already suggest that Brazil’s share will be similar to that of the US in the next 10 to 15 years. The Organisation for Economic Co-operation and Development (OECD) and the Food and Agriculture Organization (FAO), from the United Nations, in their 2010 joint agricultural outlook projected that Brazilian agricultural production will increase 38 percent from 2010 to 2019 (OECD/ FAO, 2010). This huge increase in agricultural production is nearly twice the global average and several...
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