Ribeirão Preto, a major city in the countryside of São Paulo, this week hosted Agrishow — the biggest agro fair in Brazil. Almost 200,000 people are expected to visit the stands of over 800 brands — from machine producers to startups to banks.
The event’s opener featured Agriculture Minister Carlos Fávaro and Vice President Geraldo Alckmin.
It could seem like a no-brainer that the government would be present at the main event of the most buoyant sector of the economy. However, the minister was not invited to last year’s Agrishow opening.
The organizers feared that Mr. Fávaro’s presence would irritate the previous edition’s guest of honor: far-right former President Jair Bolsonaro, who is generally very popular among farmers.
This time around, organizers decided to bring the government on Day 1, and Bolsonaro and his acolytes on Day 2 of the event. That move may have everything to do with the government’s strategy to get closer to farmers.
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- Cedê Silva is The Brazilian Report’s correspondent in Brasília.
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Transcript of this episode (with Cockatoo)
Ribeirão Preto, a major city in the countryside of São Paulo, this week hosted AgriShow, the biggest agricultural fair in Brazil. Almost 200,000 people were expected to visit the stands of over 800 brands, from machine producers to startups to banks. The event’s opener featured Agriculture Minister Carlos Fávaro and Vice President Geraldo Alckmin. It could be seen as a no-brainer that the government would be present in the main event of the most buoyant sector of the economy.
But last year, the Agriculture Minister was uninvited to the opening of Agrishow. The organizers feared that Mr. Fávaro’s presence would irritate last year’s guest of honor, far-right former president Jair Bolsonaro, who is generally pretty popular among farmers. This time around, organizers decided to bring the government on day one of AgriShow, and Bolsonaro and his acolytes on day two of the event.
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with content developed with partners. If your brand wants to connect with highly qualified international audiences, write to hello at Brazilian.report. This week we welcome back Cd Silva, our correspondent in Brasilia. Cd, glad to have you back on the show.
Thank you, Gustavo. Thank you for having me.
The relationship between farmers and the Luiz Inácio Lula da Silva administration has never been a warm one. I mean, many segments of Brazilian agribusiness were intimately involved with the Bolsonaro administration and even put money into his Putschist agenda. And Lula, on the other hand, called part of Brazilian agro fascists. So can you tell us a little bit about Lula’s relationship with Brazilian agro
and farmers’ political agenda?
Yeah, so farmers and people in farming states have always opposed Lula and the Workers’ Party, even before the days of Bolsonaro. So, for instance, in elections such as the 2014 election between Dilma Rousseff and Aysse Feneves, you had famous people related to agriculture, such as country singers, singers what we in Brazil call sertanejo, supporting AES FNEP and opposing Lula. So even before the days of Bolsonaro, people related to big agro
were always opposed to the left. They opposed land reform, they opposed environmental regulations. So there’s a series of reasons for them to oppose the left and to oppose Lula for a long time. Farmers political agenda is a complicated issue because Brazil is an agricultural superpower. There are a lot of factions involved, but one of the structures that we can understand
to simplify the issue is to divide agriculture in Brazil in three main sectors. So I’ve got one sector of big agro, this is the one that is most opposed to Lula, which is basically export based, they’re exporting soy, corn and other commodities mainly to China, and they are really opposed to Lula in a big sense, even as a cultural identity thing, so it’s more of a political thing than a policy thing. Then you’ve got parts of agro which are also politically organized, which are concerned, for example, with biodiesel. And these people that produce sugar cane so that they are agriculture, but they are also related to energy. They are more dependent
on the government and on government decisions to sell sugar cane that will go into cars and vehicles and so on. And so they have a closer relationship to the administration. And finally, you’ve got the people in family agriculture that produce a lot of the food that Brazilians eat every day, a lot of the food that goes into schools.
And these people are not as politically strong as the big agro, but many of them will also lean towards Lula because they are smaller farmers.
You have mentioned the environmental issue and I mean the government, the Lula administration promised to crack down on deforestation. So my question is, one, did it keep its word and if so, how did that affect Big Agro’s
perception of Lula administration indeed cracked very successfully on deforestation in the Amazon rainforest, where most of the land affected by deforestation is public. We are talking about federal lands. Some of this land is also protected for indigenous rights, and the government was very protected there, was very successful in cracking down deforestation motivated by agriculture, as there’s an agricultural frontier in the Amazon, as many farmers will often illegally burn down the forest in the Amazon in order
to make way for pasture. However, the Lula administration has not been successful in combating deforestation in the Cerrado region, where there’s also an important agricultural production, for instance, in the land that is now known as Mato Piba for the four states that comprise this region. And most of the reason is because a lot of deforestation in the Cerrado is on private land which belongs to farmers and the Lula de Mocicha has not been successful at all. I’m not sure, I don’t have data to know about how this fighting deforestation
changes big agro’s perception of LULU, but we do know that the reason or part of the reason for a lot of big agro supporting Bolsonaro was exactly because of his anti-environmental policy. Bolsonaro was very lenient with deforestation and in fact, one of the main operations in the Amazon to fight deforestation during the Bolsonaro term, the military was in charge and they banned the environmental agents from destroying the machinery that goes into the destruction of forests, which is something that the Lula administration is now doing very heavily. So one of the reasons why the part of Big Agro was so supportive of Bolsonaro was precisely because of his anti-environmental agenda,
which was very explicit, with absolutely a very, very, very public, with no, with no restraints.
Now, when we talk about the political relationships of Big Agro, I kind of remember a few years ago, and it started in 2018. We saw that until 2022. Those producers in many agricultural areas writing pro-Bolsonaro messages on their crops in the sort of crop circles, the Brazilian style of crop circles. We also saw farmers bringing tractors and trucks to pro-Bolsonaro protests. They paid for a lot of putschist protests in multiple parts of the country. And they have been very confrontational with Lula and his administration. But do you think it’s fair to say that tensions are not as high as they have been, at least where they were last year. And I mean, some
say that this is directly correlated with the fact that the Lula administration made a record amount of money available for farmers through the 2023-2024 Harvest Plan, which is Brazil’s main agricultural financing instrument. Do you think connecting those two dots is fair or do you think it may be a stretch?
I think it is fair with some caveats. So let’s go to the data we have. So back in August 2023 on this respective post request, they disclosed another survey, another poll about the the perception of the Lula administration. And at the time, in August 2023, there was an improvement in the approval of the Lula administration at the time. And the director of QUEST, Felipe Nunes, a very respected poster in Brazil, he pointed to the harvest plan, to the Plano Safra, as responsible for improving the perception of the Lula administration in agricultural areas, especially in the southern region, which part of the
south leans very heavily towards Bolsonaro, especially the state of Santa Catarina. And so the perception of the poster was, even though that question was not in his research, was that the harvest plan back in late 2023, mid-2023, did improve Lula’s perception, the perception of the agricultural people of the Lula administration. The other thing is besides the harvest plan that has worked, that the Lula administration was very successful was in opening up new markets for Brazilian agricultural products. President Lula back in March, he mentioned that, he said that Minister Favaro, the agricultural minister that you
mentioned, went to AgriShow this year. He called Carlos Favaro the best salesman that Brazil ever had. And the data shows that indeed, over the last few months, in this first year and a half of the Lula administration, there are several markets that Brazilian agricultural products are now being exported to Canada, Argentina, Algeria, Saudi Arabia, Colombia, Egypt, Japan, a lot of products that were not sold before and now are going to those countries.
And today to bring some color to what you’re saying, according to the Brazilian Agriculture Since January 2023, opened up over a hundred new markets for products from farms. That means 49 new countries to where Brazil can ship its beef and grains and many other agricultural products. And actually, according to the government, it is twice as many new markets as it was open during the first 15 months of the Bolsonaro administration. Now just for clarification, I said 49 new countries, 100 new markets, meaning that these 100 new markets are authorizations for 100 different agricultural products sometimes
to the same country. Yes, precisely. For instance, in the case of El Salvador, for example, you’ve got both the opening of the poultry market and the eggs market. So that’s why El Salvador can count more than once. But as we mentioned, and here’s the caveat, for the polarized politics that we talk about so much in so many other podcasts, the thing about polarization is that for a few sectors, it’s about politics, not policy. So even if Lula opens up new markets and even if there’s the harvest plan and a lot of different federal government programs for the agricultural sector, for some political sectors it will never
be enough because it’s a question of political groups, not of policy. So it doesn’t matter what Lula does or what Bolsonaro does not do, it will not change the perception of a part of big agro. But there is a part, there is a part in the big agro that there is wiggle room for the Lula administration to obtain the
support of.
Right. And back in 2022, you wrote about this phenomenon of a sort of urban left versus a rural right. And you compare that to the US.
Red states and blue states.
Yes, and they say like the coastal states and then the flyover states. Do you think it’s a natural phenomenon or just as some of the cultural wars we’re seeing in Brazil is just something we imported from the US?
I would say that that’s one of the very few things that the Bolsonarista right did not import from the US and is actually a Brazilian phenomenon for a longer time. Because you do have, for example, the left labor origins of the labor movements and the unions and the trade unions as mainly a city phenomenon, especially in Brazil, with the sectors that were then co-opted by dictator Getúlio Vargas and so on. So this left that comes from factories and industry and people that have a certain degree of education versus the rural right in the interior of the country, in the countryside, the people that listen to country music, there is actually a natural distinction, even though
of course you’ve got the landless movement, the MST, the landless workers movement as a left-wing movement, of course, in the country, and you can have, of course, a right-wing in big cities, but there is indeed a natural origin of the urban left and rural right, which happens similarly in Brazil to the United States, but for more natural reasons as opposed to being an imported cultural war.
Now looking at Brazil and agro itself, last year the performance of farmers was a huge part in Brazil managing to post positive GDP numbers. But the industry isn’t looking anywhere near as rosy this year, is it? So can you tell us a little bit about that and whether you think that the fact that many farmers are filing for bankruptcy protection, harvests in several parts of the country are facing disruptions related to climate change, how does that impact the influence that big agro has in Brazil?
Well, what we do know is if you look at the data compiled by the Senate with BNDS data, for a lot of reasons that a lot of economists can talk for a longer time than I can, the industry sector in Brazil, the manufacturing sector, has really decreased proportionally to the economy over the last several years. And the role of agriculture has become even larger as Brazil becomes a more export-based economy,
mainly to China and to sell commodities to countries such as China. We do know that, for instance, since 2021, Federal Development Bank, BNDES, actually puts more money and more credit in agriculture as opposed to industry even though BNDES was initially designed as a bank to develop or help develop Brazil’s manufacturing
industry, Brazil’s industry as a whole. So the political power of agriculture in the last few years or in the last few decades has increased much more compared to industry. And that is also the perception of lawmakers. There was a poll, which was also made by Quest. This one was in August 23.
It interviewed 185 lawmakers. And in the opinion of the lawmakers themselves, agribusiness is the sector that has the largest influence in decisions in Brazil’s Congress. So the strength of agriculture, as opposed to manufacturing, has really become much stronger in Brazil.
And now with the fact that agriculture is not putting up the same numbers as it did recently, I mean, does Lula take that situation to profit and come as a savior? How is the government trying to assist the sector?
So agriculture in Brazil has always relied very heavily on the government. We can go from the, we can go since the times of the early republic in the 19th century, when the republic was doing all kinds of crazy decisions to help maintain the price of coffee in Brazil and the day that the government, for example, mandated the destruction, the burning of war houses with coffee so as for the price of coffee not to go down too much. So agriculture and politics in Brazil, they have always walked hand in hand.
Brazil is now an agricultural superpower and has the soy belt in Brazil’s center west thanks to the research by Embrapa, a federal agency, which began the development of agriculture in the Cerrado during the Cold War, at a time when the Cerrado was taken or understood to be a completely dry region where you could not grow crops. And it’s now a Brazil’s soy belt, a large region that exports soy, corn, and so on in the central west, thanks to government-funded agency by Embrapa. The Lula administration is investing on records for the harvest plan, as you said,
which is a major credit program which includes BNDES credit, but not only BNDES, there are other sectors in the government helping this program. And the Lula administration, as other administrations, has the family agriculture program where the government will buy not only for being agro, but will buy a produce and crops, for instance,
for school lunches, which the agriculture comes from family agriculture and so on. And there are several other programs and subsidies for the agricultural sector. And the other most recent issue, to answer your question, where the agricultural sector is now more dependent on the government decision, is the biodiesel issue.
So you’ve got currently a dispute between fossil fuels and biodiesel sector. And the biodiesel sector is trying to impose regulations to increase the amount of biodiesel and ethanol that goes into Brazilian fuel. So they can have the government or the energy sector as a client for all this sugarcane that they produce.
Now, there is an interesting quirk regarding the Lula administration and agri policies because we have the Agriculture Minister, Carlos Fávaro, and the Agrarian Development Minister, Paulo Teixeira, who is a longtime ally of the President. Can you tell us a little bit about these two offices, how they have been able to work together because there was a time when it looked like the president was only referring to Teixeira on agriculture issues. Is that a fair assessment?
I think that is a fair assessment, especially because in 2023 Lula was still doing a lot of public diplomacy and a lot of public discourse on the ongoing negotiations between the European Union and Mercosur, and Paulo Teixeira was speaking against what Brazil calls green protectionism on the part of European countries, because European agricultural producers, namely those in France, are very concerned with Brazilian competition, because Brazil does it better and cheaper than a lot of European countries. And so Paulo Teixeira was speaking to these issues and Lula was using a heavy hand to speak to the European Union on how this green protection has worked
and how it affected Brazilian competition. But Carlos Favaro does agriculture in a different public. Carlos Favaro as a Minister of Agriculture is more concerned with the opening of markets and he’s more concerned with policy decisions that affect more big agro as opposed to Paulo Teixeira who works more with agrarian development which means his ministry is more concerned with the small guy, is more concerned with the small producers. And this is the reason why during 2023 Lula commended Carlos Sávaro for
being what he called the best salesman of Brazil, which tells a lot about how he is currently very supportive of both ministers.
Cedre, thank you very much. Is there something that you think we left out and it’s important for our listeners to
know?
I would also like to hammer again the point that agriculture and politics, they work together in Brazil. So no matter who the president is, agriculture producers and big agro, some of them have a speech or a discourse of independence from the government, but this is in fact not true. They depend a lot on the government because of subsidies, because of tax preferences. They rely on the government opening up the markets for them to export. And even during the Bolsonaro time, if we remember,
even though they are very closely aligned to Bolsonaro, a lot of this big agro, there was a time when the rhetoric of some ministers in the Bolsonaro administration, which was very anti-China because of communist. They were forced to shut them down. They were forced to shut down this discourse because China, of course, is a big, big customer or the main customer of a lot of this big agro. So they have to sustain two discourses at the same time, which here in Brazil, they support Bolsonaro. They are very anti-communist, but a lot of the revenue comes from China.
CD, thank you very much.
Thank you, see you next time.
CD Silva is the Brazilian Report’s Brasilia correspondent and if you like Explaining Brazil, please give us a five-star rating wherever you get your podcasts. Or better yet, subscribe to the Brazilian Report, the journalistic engine behind this podcast. We have a subscription-based business model and your memberships fuel our journalism and keep us going and growing. And our work has been recognized for its quality.
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I’m Gustavo Ribeiro, thanks for listening. Explaining Brazil will be back next week.
Transcribed with Cockatoo
