It’s a long way from southern Brazil to Western Canada.
But it was a lot easier for farmer representative Hamilton Guterres Jardim and a group of Brazilian government officials to travel to Winnipeg than it would have been for them to ship their own wheat to northern parts of their own country.
In fact, Canada has an easier time getting wheat there than they do.
“The roads are not fit and the railways are practically non-existent,” Jardim said in an interview during a course at the Canadian International Grains Institute.
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“For us to place our wheat in the north, north-east, with Brazilian flagged ships (that are) old, obsolete, with a high transportation cost, it is more viable to bring wheat from the U.S. with modern vessels.”
Jardim said Brazilian crop production is increasing but roads and railways are poor from central Mato Grosso state to southern ports. The problem is frustrating Brazilian farmers, including those in his state of Rio Grande do Sul.
Jardim is head of both his state’s farmer-controlled wheat commission and a company offering technical service to farmers.
Brazil is a vast country, much like Canada and more so like the United States. Distances between production and consuming regions are significant, and radically different crops and economic realities dominate the various regions.
Jardim’s state in southern Brazil is similar to the northern U.S. Midwest with its ability to grow wheat and vulnerability to frosts. A spring frost damaged its wheat crop last September, which reduced production by one-third.
Rio Grande do Sul and Parana states produce four million tonnes of wheat per year but fall far short of the 10.5 million tonnes that the nation’s consumers require.
Wheat exporting powerhouse Argentina is right across the border from southern Brazil, but Jardim said his country’s millers are becoming less interested in their neighbour’s wheat because its quality standards are declining.
Jardim said export taxes and other disincentives imposed on Argentina’s farmers have prompted many of the best to abandon the country for Uruguay. Brazil has started buying wheat from Uruguay, but still needs to buy in the world market to fill its needs.
He said Canadian wheat is attractive to millers who need to improve their bread quality. It works well in a blend, which is how it can occasionally reach the southern Brazilian market.
However, millers and consumers in northern and northeastern Brazil often buy wheat from North America because it is the closest market to them, at least in logistical terms.
The wheat-growing regions are far away to the southwest, and there is almost no infrastructure to ship crops north by road or rail.
As well, shipping crops out of southern Brazil by sea has become difficult as soybeans from Mato Grosso swamp the loading ability of southern ports such as Paranagua.
There are plans to build a railway from the south to central Mato Grosso, and one from there to the north, but those plans, along with proposals to improve the national highway system, are stalled.
“The (railway) project is going at a turtle’s pace with lots of corruption, and it’s not moving,” said Jardim.
“Brazilian logistics need to be improved a lot and in a short period of time because Brazilian production is growing, but the infrastructure is not following the pace.”
Jardim said he was surprised to learn how common on-farm storage is on the Prairies. His state’s farmers immediately haul their crops to local co-operative grain companies at harvest time.
He also said he was impressed by the work the Canadian Grain Commission and CIGI do with farmers, foreign customers and the grain industry to keep the Canadian grain trade working well.
“This is a very healthy practice,” said Jardim.
He hopes to take ideas back to Brazil so that it can form its own version of the Canadian organizations.
