Brazilian Farmers Feeling The Pinch

Farmers in Brazil, are experiencing problems obtaining finance, for the purchase of additional cattle and paying the rising costs of their expenses.

Brazilian farmers have been saddled with large amounts of debt in recent years, while the rural sector has expanded at an extraordinary rate.

The costs of producing corn, soy and cotton, are expected to increase 42% in 2009, according to industry analysis.

Farmers have been placed in a position where they have to forgo debt re-payments, in order to free up cash for day to day running of their farm properties.

There are stories circulating of the re-possessing of tractors and combines, and even of some large farms.

Michael Cordonnier of the Corn and Soybean Advisory, a consulting firm from Chicago, said "Now many farmers are rationing fertilizer and other supplies, which could translate into lower yields for next year".

Many Brazilian farmers, had hoped the booming grain market experienced in May, June and July would dig them out of debt. But with domestic prices having halved since then, those hopes have all but evaporated.