Soybeans Edge Out Coffee as Brazil’s No. 1 Export

For a century Brazil has been known as the world’s coffee king, but now gigantic soybean production is the country’s top export earner and the envy of foreign competitors.

“Soy (bean) is overtaking coffee,” said Joao Luiz Alberini, a plant breeder.

Brazil is the second-biggest world producer after the United States.

Brazilian researchers have developed new strains of soybean appropriate for the tropics. The country is the only tropical land to have emerged as a major soybean producer, and it is exporting its expertise to the rest of Latin America, Africa and Asia.

The emergence of the soybean in Brazil was rapid. From 1970 to 1980 national production jumped from 1.5 million metric tons to 15 million tons. Brazil accounts for about 20% of world output.

Drought Raises Prices

In 1987, exports of soybeans and byproducts soybean oil and soybean meal totaled $2.4 billion, against $2.1 billion for coffee, and analysts say that soybean exports should rise to $3.2 billion this year.

The worst United States drought in 50 years has taken soybean futures prices on the Chicago Board of Trade to 11-year highs and has benefited Brazilian planters.

“Of course the best soy fertilizer is the market price,” said Fabio Trigueirinho, a statistician at the Brazilian Assn. of Vegetable Oils (Abiove). He said many more Brazilian farmers were expected to plant soybeans in coming years.

Brazil’s arrival as a leading soybean producer has brought it into collision with the United States. The two countries are at odds over a U.S. policy of giving bonuses to exporters, enabling them to sell soybean oil at competitive prices.

According to Abiove president Antonio Iafelice, the U.S. program is squeezing Brazil out of traditional markets such as India and Pakistan and has cost the country $600 million this year in lost exports.

U.S. Varieties Used

The American refusal to scrap the bonuses has led Brazil to plan action against the United States at the General Agreement on Tariffs and Trade, the international trade regulatory body.

Brazil’s first soybean was planted in its coldest state, Rio Grande do Sul, in the south near Argentina. Farmers used varieties developed in the United States.

But during the past decade soy has become the predominant crop in the huge northwestern frontier lands being opened up for the first time.

The tropical strains have spread over vast areas.

In the states of Mato Grosso and Mato Grosso do Sul, productivity in some areas is edging past that of the United States, at 2,670 pounds per acre.

Some experts say Brazil’s soybean production, now at 17 million metric tons, could reach 38 million metric tons by the year 2000. The current American output is about 50 million tons.

‘Necessary Alternative’

Decio Gazzoni, director of the National Center for Soy Research, said Brazil was the first country to develop soybeans for low latitude areas and said the growth potential was enormous.

Many Brazilian schools serve soybean milk and soy-based meals to their students and hundreds of Brazilian food industries are already tapping the market.

“If you consider the price of meat and the condition of the poor, soy is a necessary alternative,” said Jose Carlos Casarotto of the Zaran group, whose first soybean products will arrive on supermarket shelves in two or three months.

In Gazzoni’s opinion, the strategy to convert carnivorous Latins to tofu fans is simple. “All it takes is marketing,” he said.