Western Producer reporter Ed White visited Brazil to explore agricultural development and oportunities for Canadians brought about by Brazil’s rise to prominence as an agricultural powerhouse.
CASCAVEL, Brazil – It’s hot and humid and the hogs are quiet in their pens. Some lie on their sides to conserve strength.
The barn they live in is open-sided, which allows breezes to blow through, relieving the mid-day heat. But it also lets in the scorching summer heat and farmer Sylvestre Bremm knows that reduces his herd’s performance.
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“The summer is hard for them,” said Bremm, who, along with his son and daughter-in-law, manages a 250 sow farrow-to-wean and farrow-to-finish operation for a non-farmer owner.
Brazil’s hog industry, dominated by mid-sized farms like Bremm’s, has built itself into a large producer beginning to be felt in world markets. Major investors are pumping capital into world-class production units and many see the country as having huge hog production potential.
In the south Brazilian winter, when the temperature never stays below zero even on the coldest days, the sows in Bremm’s barns are able to produce 11.5 weaned pigs per litter.
In this summer heat (Brazil’s summer occurs at the same time as the Canadian winter) his sows will only be able to get 10.5 piglets through weaning.
Bremm sells his weaners to a number of feeder operations but sells all his market hogs to a slaughter plant in Cascavel.
He contracts his production and receives the pigs’ feed from the packer. He is paid a per head price for pigs delivered.
He is able to control costs and returns for his sows and piglets by changing feed formulations of corn, soymeal and sugar. It enables Bremm to react to price swings like the upsurge in corn prices that hurt profitability last year.
Bremm’s operation involves sophisticated marketing but low-tech production methods. His barns’ floors are solid concrete instead of slatted. The manure is cleared out of the pens daily by barn hands with scrapers and channeled down gutters.
Without a closed, controlled environment, Bremm has to accept farrowing losses that come with the summer heat and has to provide heating pads for winter piglets.
This operation has 250 sows now, down from 350 a year ago because of the high price of corn, but he plans to expand to the barn’s maximum potential of 500 sows now that feed prices are back to average.
Bremm’s operation, with its open sides, hand-clearing and absence of mechanization is similar to U.S. hog barns in the 1960s and 1970s.
But the country is beginning to see major, modern production facilities.
In the central Brazilian state of Mato Grosso, Smithfield Foods has built large enclosed units and in northeastern Brazil, the federal government is encouraging the growth of huge operations in the hopes of alleviating poverty there.
Brazil still has trouble exporting its pork to lucrative markets.
Foot-and-mouth disease has continually crossed the border from Paraguay, and although no case of FMD has been found in Brazil for more than two years, livestock producers routinely vaccinate their animals except in one state, which considers itself FMD-free.
Still, Brazil’s ability to export is stunning when the country can find a buyer, said Jacob Rasmussen, a Danish swine industry consultant.
“We’ve been kicked out of Russia, completely,” said Rasmussen.
“The Brazilians have taken it. If they get into more countries like that you will see us on the downslope.”
Marcel Hacault, former chair of Manitoba Pork, toured Brazilian hog operations two years ago and sees huge potential – but major problems too.
“If they get their disease under control and their infrastructure in place, they’ll be the Wal-Mart (of pork). But they have no infrastructure and the disease problem is serious.”
Hacault said hog operations he saw were still dependent on manual labour, with little of the mechanization common to Canadian hog farms.
Brazilian labour rates are low, but with many workers, Hacault said the labour cost per barn was about the same as in Canada.
But the major difference is capital investment, which for the open-sided low-tech barns in Brazil is far below that of Canadian farms.
“If they get their act together, they will be formidable,” said Hacault.
Bremm said growing demand for Brazilian pork is making contract production attractive to managers like him.
“This works well for me,” he said.
