Economy

Brazil’s agribusiness to suffer from worst drought season

south minas drought brazil northeast agribusiness coffee soybeans sugarcane

As one of the world’s biggest agricultural producers, Brazil will be pivotal for global food security, according to the United Nations Food and Agriculture Organization (FAO). During a conference on July 23, a representative of the agency stated that Brazil will have up to 70 percent of the world’s arable land growth by 2050. Of the 69 million hectares or new arable land on earth, 49 million will be in Brazil. Severe droughts, however, pose severe threats to the agribusiness sector, the country’s main economic powerhouse.

During the 2012-2017 period, the already poor Brazilian Northeast experienced its longest and most intense and widespread drought since 1980. Over 50 percent of the region’s territory was affected, as the dry season spanned portions of all nine northeastern states. Between 2011 and 2015, the federal government decreed a state of “public calamity” in the region’s municipalities 6,295 times, as a direct result of droughts.

Large water reservoirs in the Northeast – which can store up to 10 billion liters of water – are operating at an average of 16 percent of their capacity. Six years ago, that rate was way up, at 46 percent. Dozens of creeks and ponds have dried out, leading cattle...

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