By Robert Pore
robert.pore@theindependent.com

Scheer said Brazil has an abundance of natural resources and is making a big splash on world crop, livestock and biofuels markets.

"Not only is there a lot of natural resources, but there's a lot of arable land," Scheer said.

Much of that farmland is converted in the Cerrados, Brazil's vast savannas.

With more and more land in Brazil being opened up for farming, Scheer, a member of the Nebraska Corn Board, said it presents a challenge to American farmers.

"There's an old saying that, when a piece of land sells high, that's because they aren't making any more of it," he said. "There's still a lot of acres left to be tilled in the world, whether it's Brazil, South America or Eastern Europe."

With soybean prices high, Scheer said there could be an expansion of soybean acres in Brazil, though a weaker U.S. dollar has evened the playing field a bit when it comes to exports.

While more than 70 percent of Nebraska's future corn crop will be dedicated to ethanol production, in Brazil, ethanol is produced from sugarcane. Brazil is the world's second-leading ethanol-producing country, behind the United States.

Scheer said that leaves a lot of the corn grown in Brazil for the livestock feeding industry and future expansion of that industry.

Brazil is the world's leading beef-exporting country. Grand Island's JBS Swift & Co. meat-slaughter plant is owned by a Brazilian meat company.

"They are big on value-added enterprises," Scheer said of the Brazilians. "With everything that they do, they try to squeeze every dollar from it before it's exported out of the country."

Scheer made the trip to Brazil with two other corn board members and Nebraska Corn Board Ag Program Manager Kelly Brunkhorst.

"Although stronger global grain and soybean prices will likely give Brazilian producers a good profit this year, the previous two years were difficult," Scheer said. "That has slowed expansion because it is costly to convert the savannas to good cropland."

Stan Boehr, a Nebraska Corn Board member from Henderson, said Brazil's livestock and poultry industries have grown rapidly.

"Hog and poultry production, especially," he said. "Brazilian pork and poultry are in high demand locally but also in the export markets, which compete with U.S. producers, especially in Asia."

Brazil is also the world's largest poultry exporter and fourth-largest pork exporter since 2004, according to the U.S. Department of Agriculture's Economic Research Service.

"Brazil is able to produce a lot of animal feed, which helps them produce a lot of pork and poultry," Scheer said. "They also export a lot of grass-fed beef cattle for other countries to process."

Scheer said Brazilian producers are determined to feed as much of their soybeans and corn to livestock and poultry as they can.

"Producers don't want to ship corn and soybeans," Scheer said. "They want to ship pork, beef and poultry. They want to add value and squeeze every dollar out of what they ship."

The biofuels industry in Brazil is also growing, Brunkhorst said.

"They are increasing their sugarcane production so they can produce more ethanol," Brunkhorst said. "They told us they want to double their ethanol production by 2012.

"And on the usage side, they are pushing for higher blends of ethanol at the pump. Currently, you can buy a 25 percent ethanol blend as well as 100 percent ethanol, and they have shown that the engine technology is there to use higher blends."

Brazil is also taking steps to increase its ethanol export capabilities, he said.

"They're still in the discussion stages as far as building pipelines to get ethanol to the ports, but it is definitely in their future plans," Brunkhorst said.

Reinhold Stephanes, Brazil's agriculture minister, recently reported that the country's crops should reach record levels this year, although soybean production may dip a percent or two. Soybean production was estimated at 58.2 million metric tons (2.1 billion bushels), followed by 53.4 million metric tons for corn (2.1 billion bushels). Brazil estimates it will pass the United States and become the world's top soybean exporter during the 2008-09 crop year.

In last fall's harvest, the United States produced 70.4 million metric tons (2.6 billion bushels) of soybeans and 332.1 million metric tons (13.1 billion bushels) of corn.

"There is no doubt that Brazil's crop, livestock, poultry and biofuels producers are increasingly competitive in the world marketplace," Scheer said.

He said it's important for U.S. producers to pay attention and keep advancing the country's own production efficiencies and technologies.

"That is critical if we want to maintain and grow our valuable livestock industries and add value to our own agriculture products," he said.