Comments in this weeks Pro farmer US newsletter about Brazil. Note Canada's issue are common across the globe.
Partial quote:
What’s really happening in South America
by Editor Chip Flory
Why would we expect anything less? In a year filled
with unprecedented market volatility, it should be
no surprise the outlook for South American corn and
soybean production is as cloudy as it is. And much of the
uncertainty is tied directly to what many still refer to as
a “Wall Street problem” here in the States.
The credit crunch that’s jamming up the U.S. economy
is a global problem and Brazilian corn and soybean farmers
are feeling the squeeze as much as any industry. In a
typical year, the Brazilian government delivers just-in-time
loans for growers to finish planting their crops. Ahead of
those government loans, growers rely on loans from input
suppliers to purchase seed, fertilizer and chemicals. It’s
like buying a GM car with a loan from GMAC.
This year, however, tight credit conditions are forcing
Brazilian growers to make some tough choices. Many are
having to decide if they’ll plant all their acres and cut back
on inputs per acre; or reduce their acres and go with a full
dose of inputs. It’s tough to grow a “full crop” with either
of those options.
End quote.
Source: ProFarmer USA November 22, 2008 • Vol. 36, No. 47
Partial quote:
What’s really happening in South America
by Editor Chip Flory
Why would we expect anything less? In a year filled
with unprecedented market volatility, it should be
no surprise the outlook for South American corn and
soybean production is as cloudy as it is. And much of the
uncertainty is tied directly to what many still refer to as
a “Wall Street problem” here in the States.
The credit crunch that’s jamming up the U.S. economy
is a global problem and Brazilian corn and soybean farmers
are feeling the squeeze as much as any industry. In a
typical year, the Brazilian government delivers just-in-time
loans for growers to finish planting their crops. Ahead of
those government loans, growers rely on loans from input
suppliers to purchase seed, fertilizer and chemicals. It’s
like buying a GM car with a loan from GMAC.
This year, however, tight credit conditions are forcing
Brazilian growers to make some tough choices. Many are
having to decide if they’ll plant all their acres and cut back
on inputs per acre; or reduce their acres and go with a full
dose of inputs. It’s tough to grow a “full crop” with either
of those options.
End quote.
Source: ProFarmer USA November 22, 2008 • Vol. 36, No. 47
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