The Soybean Crop in Uruguay: The Creation of a Power Block

09.07.2008 720 views
In Uruguay, as in all other countries in the region, the expansion of single-crop agriculture (monoculture) combined with the powerful presence of agri-multinationals, has led to the creation of new power blocks. This in turn creates a policy environment where important decisions are made to facilitate these groups. When compared with its neighbors, Brazil and Argentina, Uruguay has demonstrated a record increase in the use of agricultural land for soybean monoculture. Since 2003, soy land-use has multiplied 15 fold. In this short period, soybeans have displaced traditional crops, such as sunflowers, wheat, and sorghum—accompanied by parallel changes in agricultural practices, soybean monoculture is becoming the rising star in its field. However in Uruguay this is by no means the only change in agriculture since the 2002 financial crisis. As Mexican tycoon Carlos Slim recently put it, "A crisis is an opportunity."1 Because of this crisis, since 2002 fully one-quarter of Uruguay's arable land has passed into foreign ownership. Argentine capital flows are responsible for the largest purchases, now controlling half of all Uruguayan soybean production. Soybeans are by no means the only sector experiencing such changes. Uruguay's most important agricultural sector, the meat industry, has come under the control of Brazilian capital; the same has happened with rice, the country's largest export crop. The Power of Soy In Uruguay's 2001-2002 season there were only 28,900 hectares planted with soybeans. In the current season there are now 450,000 hectares planted, and some think this number could reach a million. To understand how such extreme rapid growth is possible, one only needs to look at Argentina, whose investors in the sector control 54% of soybean cultivation in Uruguayan territory as well. The price of land in Uruguay is half that of Argentine land and in Uruguay there are no export taxes.2 Although the Uruguayan land has lower productivity, the higher taxation imposed recently by the government of President Cristina Fernandez, the excuse for the current conflict with the Argentine farming sector in Argentina, seems destined to increase the agro-industrial wave of investment coming to Uruguay from Argentina, which began in 2003. The River Plate coastal area is Uruguay's premium agricultural land. Soybean cultivation here has displaced cattle ranching for meat production and is now threatening dairy production. Of the 16 million hectares available for farming in Uruguay, 13 million are used for cattle ranching; one million for arable farming and another million are destined for forestry. Cattle ranching has been losing 350,000 hectares each year to expansion of soybean plantation and it is thought that it may fall to nine million hectares (as arable land use will rise to three or four million hectares). In the 1950s the number of hectares of arable land reached 1.6 million hectares, to fall to a minimum of 400,000 hectares in 2001.3 In the current harvest, "six companies, mostly foreign or related to foreign capital, sow approximately 25% of the arable land."4 The "Grobo group" alone (owned by Argentine Gustavo Grobocopatel) has 40,000 hectares planted with soybeans using the company name "Agronegocios del Plata." They're not alone: the "El Tejar" group cultivates 50,000 hectares, half with soybeans; "MSU" (Manuel Santos Uribelarrea) and the "Ceres Tolvas and Calyx Agro" (linked to multinational Dreyfus)—all Argentine capital—combine soybean production with cereals. The price of the land is one of the key factors. Good Argentine land for soybean cultivation costs approximately US$10,000 per hectare; in Uruguay it ranges from $2,000-5,000. However, back in the year 2000, that same land cost only $400 per hectare. For this reason many producers, eager for high gains, decided to rent their land to the soybean pools.5 Landowners leasing for dairy farming are happy to get $70 a hectare; for soybeans they can charge more than $200. Arable land production yields are between six and seven times that of cattle ranching, due to high international soybean prices. With the advent of the soybean, farming has become pure business, managed by "agricultural managers." These managers see no divide between agriculture and finance. In order to provide themselves cover against any possible risks, they take out insurance and fix prices based on the Chicago Board of Trade futures markets. They diversify their client base and the products sown and their plantations are spread geographically across nations and the region as a whole. This is done to ensure that "the [agricultural] business is no riskier than any other financial activity."6 Soybean occupies around 60% of Uruguay's arable farming land, but this percentage continues to grow every year. The sunflower crop, that once represented around 40% of the land sown, has been reduced to 8.5% in 2007 and maize went from 30% to only 11.6%. In 2001, only 7% of Uruguayan arable land was part of operations of more than 1,000 hectares. By 2006 these huge operations already controlled 15% and produced 57% of the total soybean crop, though they represent only 7% of all producers. Put another way, a concentration of only 54 producers represent more than half of the soybean production. Between 2000 and 2005, 47% of the family producers (each with an average of 216 hectares), quit the business. At the other end of the spectrum, the larger agricultural-cattle industrialists went from an average of 1,878 to 3,309 hectares per producer over the same period. Finally, soybean agriculture is not a major employer due to abundant use of herbicides and the complete mechanization of the process. For example, dairy farming employs about 22 workers every 1,000 hectares, cereal agriculture only 10, but soybean needs just 2-5 workers per 1,000 hectares. Only forestry creates fewer jobs than soybean. A Nation for Sale Although the data is not precise, estimates show that in 2000 about 10% of Uruguayan land was in the hands of foreigners.7 Over the last six years, four million hectares, 25% of Uruguay's arable land, came under foreign control.8 In neighboring Brazil for example, only five million hectares are in the hands of foreigners but Brazil has 50 times more arable land than Uruguay. Half a million hectares are occupied by multinational firms in use for forestry. The Finnish company "Botnia" has 160,000 hectares in forestry operating as "Forestal Oriental"; the Spanish group Ence owns 127,000 hectares in the name of "Eufores"; the American Group Weyerhaeuser9 exploits 150,000 and the Swedish Sora Enso bought 45,000 but will need 120,000 when it installs its plant. All together a half million hectares of pine and eucalyptus are in the hands of large foreign corporations. Brazilian firms bought the largest meat refrigeration systems of Uruguay. The "Marfrig" group bought the plants in Colon; "Tacuarembó" bought those at San Jose, resulting in the 40% Brazilian control of meat production. As for rice, we see the same pattern: in 2007, the "Camin" firm (based in the neighboring Brazilian state of Rio Grande do Sul), bought the largest Uruguayan rice firm. The whole chain of rice production (agriculture, storage, and export) is in the hands of Brazilian firms, and Brazil is the major destination of Uruguayan rice production.10 Now foreign investment is eyeing the dairy industry, with the arrival of large investments from both New Zealand and Brazil. The cattle sector is becoming highly concentrated in the hands of foreign capital: 72% of beef processing is in the hands of just 10 refrigeration plants; 88% of pig production is in four plants; and just two plants process 80% of milk products.11 The situation is so serious that the authorities in the Ministry of Livestock, Agriculture, and Fisheries are nervous to speak of the subject, and have done very little to deal with the issue. The parliament approved a law that obliges land-owning joint-stock companies to lose their anonymity. This was done so that in two years' time the landowners will be named and the Uruguayan state can determine the extent of foreign ownership. But, as happens in Brazil, the true owners can hide behind "Uruguayan partners." Even given this loophole, investors in forests and special pension funds, Uruguayan or foreigners, are not obliged to reveal their land assets. However, they will be obliged to prove that they invest in technology and create employment for Uruguayan nationals. Also envisioned are means to prevent foreign ownership in border areas and implement ceilings on foreign investment. Nevertheless, there are two camps in the Uruguayan government: those who believe all investment is positive and those who maintain that it is the state, and not large multinationals, that is responsible for determining how, and in what areas, the country should grow. Serious problems result from soybean agriculture practices. Seed-sowing practices have changed radically. Traditional farming practices, even for large industrial farms, practiced rotation of crops and cow pastures, for the sake of the land. By means of rotation fertility lost during use is naturally restored by animal waste. Unlike other crops, soybean agribusiness uses continuous agriculture practices. The lack of crop rotation means the land has no opportunity to recover. This in turn leads to increased fertilizer and agro-toxin use (insecticides, etc. ...). Continuous agriculture is possible due to the use of a system of no-till sowing, which replaces conventional deep plowing. Direct seeding sows the seeds without first plowing the earth, which has the benefit of reducing the erosion. However, this practice depends on the massive use of chemical herbicides for weed control. It is however, promoted for economic efficiency to avoid rotation with cattle pastures, thereby intensifying land use. According to experts, by not being worked in a conventional manner, and because leftover soybean green matter decomposes quicker than other crops, for six months, the land is bare. This lack of vegetation results in increased erosion from rainfall. For these and other reasons soybean agriculture is one of the crops that most negatively affects the fertility of the land. The Uruguayan minister responsible for cattle ranching, Ernesto Agazzi, has indicated that: "Farming development must be environmentally, economically, and socially viable." He noted that it is possible that: "The miserable hoarding currently in operation to maximize profits using hyper-intensive agriculture is an unsustainable use of national resources," and said "To create a centimeter of land takes a thousand years and to destroy it, merely a moment." He called on producers to take care of the fertility of the soil "as a public resource."12 New Power Block The countries of MERCOSUR have usurped the position of the United States as highest soybean producing region in the world. Argentina, Brazil, Paraguay, and Uruguay (to which Bolivia should be added, due to its high production levels in the department of Santa Cruz), have reached a level of 105 million metric tons annually of soybean production, compared with 87 million in the United States. This change is part of the process of refocusing the economies of the region on the production of primary commodities for export, implementing modern technological developments in agri-business. Put another way, the region is being placed in its position in an international division of labor, as provider of agricultural commodities as feed for factory fed animals in the northern hemisphere. For that reason, the soybean production area has increased by 120% in Latin America between 1990 and 2005. One of the decisive changes that soybean brought to Uruguay is the change in the way the corporate sector operates. There was a power shift in the chain of production from the growers to the grain buyers, who in turn became the main source of financing.13 To a large extent this explains the role of the large multinationals and the concentration of production, leading to the fact that agriculture has now become a speculative industry. Another relevant change is the degree of industrial processing of the region's soybean crop. Most countries export their soybean crop in the form of raw beans (unprocessed), with the notable exception of Argentina. For example in 2007, Brazil processed only 52%, but Argentina processed 71% of its production into soybean flours and oils. Uruguay lies on the other end of the spectrum: only processing 5%, and exporting 95% as raw soybeans.14 Obviously raw bean exports generate very few jobs. Argentina raised taxes on soybean and sunflower exports to foment grain production, creating subsidies. In some aspects the Argentine national policies favor the creation of jobs, although the Argentine policy lacks any policies for redistribution of wealth. Instead Argentine policy is limited to favoring large production and export groups and for soy flour and oil, with whom the government maintains a solid alliance. It is interesting to note that although the regional governments differ somewhat in their policies, the results are the same, always benefiting the same interests. In Brazilian grain/bean processing, 50% is undertaken by four companies; the first three are U.S.: Bunge, Archer Daniels Midland Group (ADM), and Cargill. In Argentina, just three companies control 50%; of them two are U.S.: Bunge and Cargill, and the third Argentine, Vicentín.15 The industrial production is in the same hands, and highly concentrated, as is commercialization of these products. Back in Uruguay, where, as we noted before, the soybean industry chose not to industrialize, we see that the concentration of the exporting groups is even greater than those of its neighbors. The five main corporations control 77% of the exports. First is ADM, with 21.5% of the soybean exports. In 1996, the Department of Justice of the United States applied the largest antitrust criminal fine in the history of the country, ($100 million dollars) on ADM for their part in the lysine and citric acid cartel. In second place is Cargill, with 18.6%. Next come three Argentine groups: "Agronegocios del Plata" of the Grobo group, controlling 15%; followed of "Peréz Companc16 with 11%; and in fifth place a subsidiary of Dreyfus, Uruagri, with 10.6%. All told: two American multinationals control 40% of the Uruguayan exports of soybean, and three Argentine corporations another 37%. In order to complete the panorama, it should be noted that Uruguay is an importer of flours, oils, and industrial derivatives of the soybean. It also imports all that is required for soybean cultivation, from seeds to agrochemicals such as fertilizer. Put simply, Uruguay exports raw grains and imports their industrial byproducts. These are the new factors of power in Uruguay and in the region. The progressive governments of Luiz Inácio Lula da Silva, Cristina Fernández, and Tabaré Vázquez, support this new power block formed by local elites tied into agri-business and the multinationals in the sector. Commenting on the recent resignation of the Lula administration's environment minister, Marina Silva, the MST (Brazilian Landless Peasants' Movement), indicated that her resignation should be chalked up as a victory for agri-business. "Agri-business is today the largest protagonist of the great destruction of the Amazon Basin," using "the state apparatus for their own private aims." By employing tactics such as large illegal land occupations by owners of large estates, the land is de-forested for wood, and cattle and soybean soon follow. "This process is lead by financial capital and the huge multinationals of agri-business like Cargill, Bunge, Monsanto, Syngenta, Stora Enso, and Aracruz," says the MST. The unholy alliance of Southern Cone governments with agri-business is, as they say in the River Plate region, "bread now, hunger for tomorrow." In the region this saying applies in both senses. In literal terms, as has been repeatedly stated, monocultures are anathema to food sovereignty. Secondly, because the new blocks of power that these governments help to support are now beginning to ask for more than those same governments can give them without losing their popular support. The "lock out" of the Argentine power groups is a small taste of things to come. End Notes El País (España), June 8, 2008. Argentina has measures in place to control and tax certain exports. The export rights ("derechos de exportación") have been in place for a long time; their taxation levels ("retenciones") have risen sharply since the financial crisis of 2002 and are now the reason for unrest in Argentina. "El País agropecuario", ob. Cit. Idem. A pool is a financial "pool" of people or organizations who provide capital to rent land for soybean production; they provide all services and the renter is simply paid a fee per sow-to-harvest period. "Soja transgénica y sus impactos en Uruguay," ob. cit. p. 45. Idem, p. 178. "Los dueños de Uruguay" (Uruguay's owners), ob. cit. Idem. "Soja transgénica y sus impactos en Uruguay" (Transgenic soybeans and their impact in Uruguay), p. 142. Raúl Zibechi, ob. cit. "Soja transgénica y sus impactos en Uruguay," p. 25. Idem, p. 159. Idem, p. 163. Raúl Zibechi is international analyst for Brecha of Montevideo, Uruguay, lecturer and investigator on social movements at the Multiversidad, and adviser to several social groups. He is a monthly collaborator with the Americas Policy Program (http:///). Raúl Zibechi

A Practical Method for Adjusting the Premium Rates in Crop-Hail Insurance with Short-Term Insurance Data

The frequency of hailstorms is generally low in small geographic areas. In other words, it may be very likely that hailstorm occurrences will vary between neighboring locations within a short period of time. Besides, a newly launched insurance scheme lacks the data. It is, therefore, difficult to sustain a sound insurance program under these circumstances, with premium rates based on meteorological data without a complimentary adjustment process.


Malta - Vegetable production dropped 7% in 2018

Last year, Malta’s local vegetable produce dropped by 7% when compared to the previous year. The total vegetables produced in tonnes amounted to 58,178, down by 7% when compared to 2017. Their value too diminished as the total produce was valued at €30 million, down by 13% over the previous year. The most significant drop was in potatoes, down by 27% over the previous year. Tomatoes and onions were the only vegetables to have increased in volume, by 3% and 4% respectively but their value diminished by 9% and 24% respectively. The figures were published by the National Statistics Office on the event of World Food Day 2019, which will be celebrated on Wednesday. Cauliflower, cabbage and lettuce produce dropped by 10%, 3%, and 12% respectively. In the realm of local fruit, a drop of produce was registered here too apart from strawberries, which experienced a whopping increase of 58% over 2017. Total fruit produced in 2018 amounted to 13,057 tonnes, down by 1% when compared to 2017. The total produce was valued at €10 million, a 3% increase in value. Peaches produced were down by 35% and the 376 tonnes of peaches cultivated amounted to €0.5 million in value. Orange produce dropped by 10% and lemon produce dropped by 14%. There was no change in the amount of grapes produced and the 3,642 tonnes of grapes produced in 2018 were valued at €2.3 million. 70% of fruit and vegetables consumed in Malta is imported. The drop in local produce could be the result of deleterious or unsuitable weather patterns. Source -


USA - Greenhouse tomato production spans most states

While Florida and California accounted for 76 percent of U.S. production of field-grown tomatoes in 2016, greenhouse production and use of other protected-culture technologies help extend the growing season and make production feasible in a wider variety of geographic locations. Some greenhouse production is clustered in traditional field-grown-tomato-producing States like California. However, high concentrations of greenhouses are also located in Nebraska, Minnesota, New York, and other States that are not traditional market leaders. Among the benefits that greenhouse tomato producers can realize are greater market access both in the off-season and in northern retail produce markets, better product consistency, and improved yields. These benefits make greenhouse tomato production an increasingly attractive alternative to field production despite higher production costs. In addition to domestic production, a significant share of U.S. consumption of greenhouse tomatoes is satisfied by imports. In 2004, U.S., Mexican, and Canadian growers each contributed about 300 million pounds of greenhouse tomatoes annually to the U.S. fresh tomato market. Since then, Mexico’s share of the greenhouse tomato market has grown sharply, accounting for almost 84 percent (1.8 billion pounds) of the greenhouse volume coming into the U.S. market. Source -


World cherry production will decrease to 3.6 million tons

According to information from the USDA for the 2019-2020 season, world cherry production is expected to decrease slightly and amount to 3.6 million tons. This decline is due to the damages that the weather caused on cherry crops in the European Union. Even though Chile is expected to achieve a record export, world trade in cherries is expected to drop to 454,000 tons, based on lower shipments from Uzbekistan and the US. Turkey Turkey's production is expected to increase to 865,000. As a result of the strong export demand, producers continue to invest and improve their orchards, switching to high yield varieties and gradually expanding the surface for sweet cherries. More supplies are expected to increase exports to a record 78,000 tons, continuing its long upward trend. Chile Chile's production is forecast to increase from 30,000 tons to 231,000 as they have a larger area of mature trees. Between 2009/10 and 2018/19, the crop area has almost tripled, a trend that is expected to continue. The country is expected to export up to 205,000 tons in higher supplies. The percentage of exports destined for China has increased from 13 to almost 90% since 2009/10. China China's production is expected to increase by up to 24% and to amount to 420,000 tons, due to the recovery of the orchards that were damaged by frost last year. In addition, there are new crops that will go into production. Imports are expected to increase by 15,000 tons and to stand at 195,000 tons, as the increase in supplies from Chile will more than compensate for the lower shipments from the United States. Although higher tariffs are maintained for American cherries, the United States is expected to remain China's main supplier in the northern hemisphere. United States US production is expected to remain stable at 450,000 tons. Imports are expected to increase to 18,000 tons with more supplies available from Chile. Exports are forecast to decrease for the second consecutive year to 80,000 tons, as high retaliatory tariffs continue to suppress US shipments to China. If this happens, it will be the first time that US cherry exports experience a decrease in 2 consecutive years since 2002/03, when production suffered a fall of 44%. European Union EU production is projected to fall by more than 20%, remaining at 648,000 tons because of the hail that affected the early varieties in Italy, and the frost, low temperatures, and drought that caused a significant loss of fruit in Poland, the main producer. Lower supplies are expected to pressure exports to 15,000 tons and increase imports to 55,000 tons. Russia Russia's imports are expected to contract by 13,000 tons to 80,000 with lower supplies from Kazakhstan, Moldova, and Serbia. Source -


EU - 20% fewer apples and 14% fewer pears than last year

This year's European apple production is expected to come to 10,556,000 tons. That is 20% less than last year. It is also 8% less than the average over the past three years. The European pear harvest is expected to be 2,047,000 tons. This is 14% lower than last year and 9% less than the previous three seasons average. These figures are according to the World Apple and Pear Association, WAPA's top fruit prognoses. They presented their report at Prognosfruit this morning. Apple harvest per country Poland is Europe's apple-growing giant. This country is expected to process 44% fewer apples. The yield is expected to be 2,710,000 tons. Last year, this was still 4,810,000 tons. In Italy, yields are only three percent lower than last year. According to WAPA, this country will have an apple harvest of 2,195,000 tons. France takes third place. They will even have 12% more apples than last year to process - 1,652,000 tons. Pear harvest per country With 511,000 tons, Italy's pear harvest is much lower than last year. It has dropped by 30%. In terms of the average over the previous three seasons, this fruit's yield is 29% lower. In the Netherlands, the pear harvest is expected to be six percent lower, at 379,000 tons. This volume is still 3% more than the average over the last three years. Belgium has 10% fewer pears (331,000 tons) than last year. They are just ahead of Spain. With 311,000 tons, Spain who will harvest four percent more pears. Apple harvest per variety The Golden Delicious remains, by far, the largest apple variety in Europe. It is expected that 2,327,000 tons of these apples will be harvested this year. This is three percent less than last year. At 1,467,000 tons, Gala estimations are exactly the same as last year. The European Elstar harvest will also be roughly equivalent to last year. A volume of 355,000 tons of this variety is expected. Pear harvest per variety Looking at the different varieties, the European Conference is estimated to be 8% lower than last year. A volume of 910,000 tons is expected. The low Italian pear estimate will result in 34% fewer Abate Fetel pears (211,000 tons) being available. This is according to WAPA's estimate. This makes this variety smaller than the Williams BC (230.000 ton) in Europe. Source -


Spring frost losses and climate change not a contradiction in terms - Munich Re

Between 17 April and 10 May 2017, large parts of Europe were hit by a cold snap that brought a series of overnight frosts. As the budding process was already well advanced due to an exceptionally warm spring, losses reached historic levels – particularly for fruit and wine growers: economic losses are estimated at €3.3bn, with around €600m of this insured. In the second and third ten-day periods of April, and in some cases even over the first ten days of May 2017, western, central, southern and eastern Europe experienced a series of frosty nights, with catastrophic consequences in many places for fruit growing and viticulture. The worst-affected countries were Italy, France, Germany, Poland, Spain and Switzerland. Losses were so high because vegetation was already well advanced following an exceptionally warm spell of weather in March that continued into the early part of April. For example, the average date of apple flowering in 2017 for Germany as a whole was 20 April, seven days earlier than the average for the period 1992 to 2016. In many parts of Germany, including the Lake Constance fruit-growing region, it even began before 15 April. In the case of cherry trees – whose average flowering date in Germany in 2017 was 6 April – it was as much as twelve days earlier than the long-term average. The frost had a devastating impact because of the early start of the growing season in many parts of Europe. In the second half of April, it affected the sensitive blossoms, the initial fruiting stages and the first frost-susceptible shoots on vines. Meteorological conditions The weather conditions that accounted for the frosty nights are a typical feature of April, and also the reason for the month’s proverbial reputation for changeable weather. The corridor of fast-moving upper air flow, also known as the polar front, forms in such a way that it moves in over central Europe from northwesterly directions near Iceland. This north or northwest pattern frequently occurs if there is high air pressure over the eastern part of the North Atlantic, and lower air pressure over the Baltic and the northwest of Russia. Repeated low-pressure areas move along this corridor towards Europe, bringing moist and cold air masses behind their cold fronts from the areas of Greenland and Iceland. Occasionally, the high-pressure area can extend far over the continent in an easterly direction. The flow then brings dry, cold air to central Europe from high continental latitudes moving in a clockwise direction around the high. It was precisely this set of weather conditions with its higher probability of overnight frost that dominated from mid-April to the end of the month. There were frosts with temperatures falling below –5°C, in particular from 17 to 24 April (second and third ten-day periods of April), and even into the first ten-day period of May in eastern Europe. The map in Fig. 2 shows the areas that experienced night-time temperatures of –2°C and below in April/May. High losses in fruit and wine growing Frost damage to plants comes from intracellular ice formation. The cell walls collapse and the plant mass then dries out. The loss pattern is therefore similar to what is seen after a drought. Agricultural crops are at varying risk from frost in the different phases of growth. They are especially sensitive during flowering and shortly after budding, as was the case with fruit and vines in April 2017 due to the early onset of the growing season. That was why the losses were so exceptionally high in this instance. In Spain, the cold snap also affected cereals, which were already flowering by this date. Even risk experts were surprised at the geographic extent and scale of the losses (overall losses: €3.3bn, insured losses: approximately €600m). Overall losses were highest in Italy and France, with figures of approximately a billion euros recorded in each country. Two basic concepts for frost insurance As frost has always been considered a destructive natural peril for fruit and wine growing and horticulture, preventive measures are widespread. In horticulture, for example, plants are cultivated in greenhouses or under covers, while in fruit growing, frost-protection measures include the use of sprinkler irrigation as well as wind machines or helicopters to mix the air layers. Just how effective these methods prove to be will depend on meteorological conditions, which is precisely why risk transfer is so important in this sector. There are significant differences between one country and the next in terms of insurability and insurance solutions. But essentially there are two basic concepts available for frost insurance: indemnity insurance, where hail cover is extended to include frost or other perils yield guarantee insurance covering all natural perils In most countries, the government subsidises insurance premiums, which means that insurance penetration is higher. In Germany, where premiums are not subsidised and frost insurance density is low, individual federal states like Bavaria and Baden-Württemberg have committed to providing aid to farms that have suffered losses – including aid for insurable crops such as wine grapes and strawberries. Late frosts and climate change There are very clear indications that climate change is bringing forward both the start of the vegetation period and the date of the last spring frost. Whether the spring frost hazard increases or decreases with climate change depends on which of the two occurs earlier. There is thus a race between these two processes: if the vegetation period in any given region begins increasingly earlier compared with the date of the last spring frost, the hazard will increase over the long term. If the opposite is the case, the hazard diminishes. Because of the different climate zones in Europe, the race between these processes is likely to vary considerably. Whereas the east is more heavily influenced by the continental climate, regions close to the Atlantic coastline in the west enjoy a much milder spring. A study has shown that climate change is likely to significantly reduce the spring frost risk in viticulture in Luxembourg along the River Moselle1. The number of years with spring frost between 2021 and 2050 is expected to be 40% lower than in the period 1961 to 1990. By contrast, a study on fruit-growing regions in Germany2 concluded that all areas will see an increase in the number of days with spring frost, especially the Lake Constance region, where reduced yields are projected until the end of this century. At the same time, however, only a few preliminary studies have been carried out on this subject, so uncertainty prevails. Outlook The spring frost in 2017 illustrated the scale that such an event can assume, and just how high losses in fruit growing and viticulture can be. Because the period of vegetation is starting earlier and earlier in the year as a result of climate change, spring frost losses could increase in the future, assuming the last spring frost is not similarly early. It is reasonable to assume that these developments will be highly localised, depending on whether the climate is continental or maritime, and whether a location is at altitude or in a valley. Regional studies with projections based on climate models are still in short supply and at an early stage of research. However, one first important finding is that the projected decrease in days with spring frost does not in any way imply a reduction in the agricultural spring frost risk for a region. So spring frosts could well result in greater fluctuations in agricultural yields. In addition to preventive measures, such as the use of fleece covers at night, sprinkler irrigation and the deployment of wind machines, it will therefore be essential to supplement risk management in fruit growing and viticulture with crop insurance that covers all natural perils. Source - ttps://


Russia Livestock Overview: Cattle, Swine, Sheep & Goats

Private plots generate 48 percent of cattle, 43 percent of swine and 54 percent of sheep and goats in Russia.  The Russian government recently approved a new program that will succeed the National Priority Project in agriculture (NPP) titled, “TheState Program for Development of Agriculture and Regulation of Food and Agricultural Markets in 2008-2012,” that encourages pork and beef production and attempts to address Russia’s declining cattle numbers.  This program includes import-substitution policies designed to stimulate domestic livestock production and to protect local producers. In the beginning of 2007, the economic environment for swine production was generally unfavorable.  The average production cost was RUR40-45/kilo of live weight, while the farm gate price was RUR40/kilo live weight.  Pork producers have been expressing concern for years about sales after implementation of the NPP as pork consumption is growing at a slower rate than pork production.  As a result, the pork sector has been lobbying the Russian government to regulate imports in spite of the meat TRQ agreement. From January-September 2007, 1.38 million metric tons (MMT) of red meat was imported.  A 12-year decline in beef production has resulted in limited beef availability in the Russian market leading to a spike in prices.  In response, the Russian government has been force to take steps to increase the availability of beef by lifting a meat ban on Poland and by looking to Latin America for higher volumes of product.  Feed stocks decreased during the first 11 months of 2007 compared to the previous year which will likely create even greater financial problems for livestock operations in 2008 as feed prices continue to skyrocket.  Grain prices increased rapidly in Russia through the middle of July 2007 before stabilizing at high levels as harvest progress reports were released. The Russian pig crop is expected to increase by 6 percent in 2008, while cattle herds are predicted to decrease by 3.5 percent.  Some meat market analysts predict that by 2012, as new and modernized pig farming complexes reach planned capacity, pork production could reach 3.5 MMT – up 75 percent from 2008 estimates. According to the Russian Statistics Agency (Rosstat), 1/3 of all Russian “large farms” are unprofitable.  Many of these are involved in livestock production.  Small, inefficient producers are uncompetitive and have already begun disappearing from the market. The Russian veterinary service continues to playa decisive role in meat import supply management. Source -


Statistics Canada : Farm income, 2011

Realized net income for Canadian farmers amounted to $5.7 billion in 2011, a 53.1% increase from 2010. This rise followed a 19.0% increase in 2010 and a 19.6% decline in 2009. Realized income is the difference between a farmer's cash receipts and operating expenses, minus depreciation, plus income in kind. Realized net income fell in four provinces: Newfoundland and Labrador, Nova Scotia, Manitoba and British Columbia. In each, increases in costs outpaced gains in receipts. Farm cash receipts Farm cash receipts, which include market receipts from crop and livestock sales as well as program payments, rose 11.9% to $49.8 billion in 2011. This was the first increase since 2008. Market receipts alone increased 12.0% to $46.3 billion. Crop receipts, which increased 15.8% to $25.9 billion, contributed the most to the increase. Sales from livestock products rose 7.5% to $20.3 billion, the largest annual increase since 2005. Stronger prices for grains and oilseeds played a major role in the increase in crop revenues. For example, canola receipts increased 37.3% in 2011 on the strength of a 27.3% gain in prices. Grains and oilseed prices started rising in the last half of 2010 as a result of limited global stocks and strong demand. Even though prices peaked in mid-2011, prices for the year, on average, remained well above 2010 levels. Crop receipts rose in every province except Manitoba and Newfoundland and Labrador. In Manitoba, difficult growing conditions reduced marketings of most grains and oilseeds. In Prince Edward Island and New Brunswick, increases in potato prices and marketings helped push crop receipts higher. It was also stronger prices that were behind the rise in livestock receipts. Hog receipts increased 15.5% to $3.9 billion on the strength of a 14.7% price increase. Cattle prices rose 19.5% in 2011, while receipts increased 1.1% because of a reduced supply of market animals. Hog, cattle and calf prices increased in 2010. The upward trend continued throughout most of 2011, primarily because of low North American inventories and high feed grain costs. Receipts for producers in the three supply-managed sectors-dairy, poultry and eggs-increased 7.9% as rising prices reflected higher costs for feed grain and other production inputs. A 14.9% rise in chicken receipts exceeded increases for eggs (+8.7%) and dairy products (+5.3%). Program payments increased 11.2% to $3.5 billion in 2011. Increases in Quebec provincial stabilization payments as well as crop insurance payments in Manitoba and Saskatchewan accounted for much of the rise. Farm expenses Farm operating expenses (after rebates) were up 8.4% to $38.3 billion in 2011, the second-largest percentage increase since 1981. This increase followed two consecutive years of modest declines. Higher prices for fertilizer, feed and machinery fuel contributed to the increase in operating expenses. According to the Farm Input Price Index, both fertilizer and machinery fuel prices were up by over 25% in 2011. At the same time, feed grain prices increased by more than 30%. When depreciation charges were included, total farm expenses increased 8.2% to $44.1 billion. Depreciation costs rose 6.9%. Total farm expenses advanced in every province in 2011. The largest percentage increases occurred in Saskatchewan (+12.3%), Quebec (+9.5%) and Alberta (+9.0%). Total net income Total net income reached $5.8 billion, a $3.3 billion gain. There were large increases in Saskatchewan (+$2.1 billion), Alberta (+$567 million) and Ontario (+$470 million), while Newfoundland and Labrador, New Brunswick and Manitoba saw declines. Total net income adjusts realized net income for changes in farmer-owned inventories of crops and livestock. It represents the return to owner's equity, unpaid labour, and management and risk. The total value of farm-owned inventories rose by $165 million in 2011. A strong increase in deferred grain payments together with the first increase in cattle inventories since 2004 contributed to the rise. Note to readersRealized net income can vary widely from farm to farm because of several factors, including commodities, prices, weather and economies of scale. This and other aggregate measures of farm income are calculated on a provincial basis employing the same concepts used in measuring the performance of the overall Canadian economy. They are a measure of farm business income, not farm household income. Financial data for 2011 collected at the individual farm business level using surveys and other administrative sources will soon be tabulated and made available. These data will help explain differences in performance of various types and sizes of farms. For details on farm cash receipts for the first three quarters of 2012, see today's "Farm cash receipts" release. As a result of the release of data from the 2011 Census of Agriculture on May 10, 2012, data on farm cash receipts, operating expenses, net income, capital value and other data contained in the Agriculture Economic Statistics series are being revised, where necessary. The complete set of revisions will be released in the November 26, 2013, edition of The Daily. Table 1 Net farm income 2009 2010r 2011p 2009 to 2010 2010 to 2011 millions of dollars % change + Total farm cash receipts including payments 44,599 44,466 49,772 -0.3 11.9 - Total operating expenses after rebates 36,052 35,315 38,276 -2.0 8.4 = Net cash income 8,547 9,151 11,496 7.1 25.6 + Income-in-kind 39 40 45 2.6 11.1 - Depreciation 5,471 5,483 5,864 0.2 6.9 = Realized net income 3,115 3,709 5,677 19.0 53.1 + Value of inventory change -281 -1,157 165 ... ... = Total net income 2,834 2,551 5,842 ... ... Table 2 Net farm income, by province Canada Newfoundland and Labrador Prince Edward Island Nova Scotia New Brunswick Quebec millions of dollars 2010r + Total farm cash receipts including payments 44,466 118 407 500 479 7,171 - Total operating expenses after rebates 35,315 106 367 422 406 5,472 = Net cash income 9,151 12 41 78 73 1,699 + Income-in-kind 40 0 0 1 1 10 - Depreciation 5,483 8 41 59 54 727 = Realized net income 3,709 4 0 19 20 983 + Value of inventory change -1,157 -0 18 0 9 13 = Total net income 2,551 4 18 19 29 996 2011p + Total farm cash receipts including payments 49,772 120 477 527 533 7,967 - Total operating expenses after rebates 38,276 114 391 448 424 6,018 = Net cash income 11,496 6 86 79 109 1,949 + Income-in-kind 45 0 0 1 1 11 - Depreciation 5,864 9 43 62 55 767 = Realized net income 5,677 -2 43 18 55 1,194 + Value of inventory change 165 -0 -12 2 -50 -24 = Total net income 5,842 -3 31 20 5 1,170 Source -

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