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Organic Increasing in Brazil, Peaks in Argentina

Brazil and Argentina are becoming important players in organic agriculture, particularly the organic soybean market. While Brazil’s overall organic production is increasing, soybean production faces challenges. Argentina’s organic soybean production is increasing, but overall organic production is not.

“Terrible” year for organic soybeans
Brazil’s organic soybean production in 2005 was terrible, according to Leon Klein, president, Klein Commodities, a Brazil-based broker of organic soybeans. “This past year was a very bad year for the farmer, crusher, and exporter.”

The main problem was the weakened Brazilian currency, the real, which is now worth less than one-half of a US dollar.

Klein describes Brazil’s organic soybean production as “flat.” Brazil has produced about 30,000 tons of organic soybeans in each of the past three years.

The weakened real has also hurt Brazil’s organic sugar exports. Brazil is a leading producer of organic sugar, and demand has been growing, but Klein says exporters will only sell if they can cover their expenses.

Overall, Brazil’s organic production increased by 20 percent in 2005 to 1.1 million acres. The country’s minister of agriculture, Roberto Rodrigues, recently announced plans to expand Brazil’s organic production to 20 percent of the country’s total agricultural production.

Rodrigues also announced the establishment of a government seal guaranteeing the origin and quality of Brazil’s organic agricultural products, which will enhance the country’s ability to access international markets.

Argentina’s organic production not increasing
While Brazil’s organic production is growing, Argentina’s organic crop production has reached a plateau. “It has been stable in the last few years with the same amount of land in organic production,” says Laura Cuner, president, Della Natura Commodities, a supplier of organic ingredients from Argentina.

Cuner says the production peak corresponds to peaked organic demand in Europe, which is Argentina’s biggest export market.

Argentina is second in the world to Australia in certified organic farmland with 6.9 million acres. Argentina’s organic production is worth an estimated $40 million per year.

While Brazil’s climate favors production of more tropical crops, such as coffee, sugar cane, cocoa, and bananas, Argentina’s organic production is more grain-based. The country’s main crops are soybeans, sunflower seeds, corn, flax, and wheat, which are mostly exported.

Organic soybean acreage increasing
Argentina will harvest about 12,000 tons of organic soybeans this April, the majority of which will be exported to Europe and the United States for feed use.

Patricia Sassaroli, president, Sassaroli Organic Agribusiness, an organic grain exporter, says organic soybean acreage is increasing in Argentina, while production of other grains, such as sunflowers, is decreasing.

Argentina has much more potential for organic production. “There are good opportunities for small farmers in South America (to produce organic),” says Cuner.

It is easier for South American farms to transition to organic because large areas of farmland have not been treated with agricultural chemicals.

Argentina’s organic agriculture is also more established than Brazil’s, with more infrastructure in place to support it. “There are three or four organic certifiers, cleaning and conditioning facilities, and more traders,” says Sassaroli.