Historically, agriculture has been a frontier activity. Land was logically the most critical component of food production. In succeeding years the frontier has shifted to include infrastructural assets like transportation and processing. Later, the agricultural frontier was extended through financial mechanisms, such as markets. And today the biotech revolution has imbued the agri-frontier with an intellectual component.
To have a viable agricultural economy it is no longer enough to just be able to grow a crop. That is a lesson that has been learned well by an emerging economic giant in the southern hemisphere that is rapidly increasing its ground under cultivation.
With the expansion comes improvement to rails, roads, rivers, and ports. In towns like Santarem, located just 300 miles up the Amazon River from the Atlantic, grain companies are building large processing facilities to load ocean going ships. The new docks are 1500 miles closer to European ports-of-call than traditional loading locations to the South.
To make it easier to supply these facilities the Brazilian government plans to pave 4500 miles of roads and finish a railroad running north from the central states.
Roberto Rodriguez, Brazilian Agriculture Minister: "We are now very hopeful that there will be investments in the logistics infrastructure sector. Brazilian production has increased repeatedly year after year, and that starts to leave the current infrastructure behind."
The work will all be paid for via taxation. Despite the fact the cost will cut into farmers profits there appears to be a willingness by landowners to pay the bill.
The potential of this new market is not lost on the world leaders in support industries for agri-business. Prepared to ride this wave of future prosperity are U.S. companies like John Deere, Monsanto, and Pioneer. And agricultural production groups like Cargill, Tyson, and Smithfield have set-up shop; many of the companies having been in Brazil for several years.