• TABLE OF CONTENTS
HIDE
 Front Cover
 Title Page
 Table of Contents
 Preface
 Abbreviations
 Currency equivalents
 I. The agricultural sector
 II. Agricultural research
 III. The project
 IV. Project implementation
 V. Production and technology
 VI. Demand and market prospect...
 VII. Benefits and justificatio...






Title: Brazil, agricultural research II project
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Permanent Link: http://ufdc.ufl.edu/UF00053814/00001
 Material Information
Title: Brazil, agricultural research II project
Physical Description: 2 v. in 3 : ; 29 cm.
Language: English
Creator: Empresa Brasileira de Pesquisa Agropecuária
International Agricultural Development Service
Publisher: EMBRAPA
Place of Publication: Brasília
Publication Date: 1980
 Subjects
Subject: Agriculture -- Research -- Brazil   ( lcsh )
Genre: federal government publication   ( marcgt )
non-fiction   ( marcgt )
 Notes
Statement of Responsibility: developed by EMBRAPA with assistance from the International Agricultural Development Service.
 Record Information
Bibliographic ID: UF00053814
Volume ID: VID00001
Source Institution: University of Florida
Holding Location: University of Florida
Rights Management: All rights reserved by the source institution and holding location.
Resource Identifier: aleph - 000500689
oclc - 12111634
notis - ACS0322

Table of Contents
    Front Cover
        Front Cover
    Title Page
        Title Page
    Table of Contents
        Table of Contents 1
        Table of Contents 2
    Preface
        Page i
    Abbreviations
        Page ii
        Page iii
        Page iv
        Page v
        Page vi
    Currency equivalents
        Page vii
    I. The agricultural sector
        Page 1
        A. The sector in the economy
            Page 1
        B. Agricultural development policy
            Page 2
            Page 3
            Page 4
        C. Agricultural support prices
            Page 5
            Page 6
            Page 7
            Page 8
            Page 9
    II. Agricultural research
        Page 10
        A. Embrapa: The brazilian agricultural research corporation
            Page 10
            Page 11
            Page 12
            Page 13
            Page 14
        B. Interactions with other agricultural services
            Page 15
            Page 16
            Page 17
    III. The project
        Page 18
        A. Introduction
            Page 18
        B. Objectives and scope
            Page 18
        C. Detailed features
            Page 19
            Page 20
            Page 21
        D. Project costs
            Page 22
            Page 23
            Page 24
            Page 25
    IV. Project implementation
        Page 26
        A. Organization and responsibility
            Page 26
        B. Filed implementation and research methodology
            Page 26
            Page 27
            Page 28
        C. Staff training and implementation
            Page 29
        D. Monitoring and evaluation
            Page 30
            Page 31
    V. Production and technology
        Page 32
        Page 33
        Page 34
        Page 35
        Page 36
    VI. Demand and market prospects
        Page 37
        Page 38
        Page 39
    VII. Benefits and justification
        Page 40
        A. Investment in agricultural research
            Page 40
        B. Beneficiaries and target population groups
            Page 41
        C. Social benefits
            Page 42
        D. Project risks
            Page 42
        E. Environmental effects
            Page 42
            Page 43
Full Text





















BRAZIL

AGRICULTURAL RESEARCH II PROJECT


_ _
























BRAZIL




AGRICULTURAL RESEARCH II PROJECT


July 9, 1980








BRAZIL

AGRICULTURAL RESEARCH II PROJECT


TABLE OF CONTENTS


VOLUME I

Page No.

Preface i
Abbreviations ii
Currency Equivalents vii

I. THE AGRICULTURAL SECTOR 1

A. The Sector in the Economy 1
B. Agricultural Development Policy 2
C. Agricultural Support Prices 5

II. AGRICULTURAL RESEARCH 10

A. EMBRAPA The Brazilian Agricultural Research 10
Corporation
B. Interactions with Other Agricultural Services 15

III. THE PROJECT 18

A. Introduction 18
B. Objectives and Scope 18
C. Detailed Features 19
D. Project Costs 22

IV. PROJECT IMPLEMENTATION 26

A. Organization and Responsibility 26
B. Field Implementation and Research Methodology 26
C. Staff Training and Implementation 29
D. Monitoring and Evaluation 30

V. PRODUCTION AND TECHNOLOGY 32

VI. DEMAND AND MARKET PROSPECTS 37

VII. BENEFITS AND JUSTIFICATION 40

A. Investment in Agricultural Research 40
B. Beneficiaries and Target Population Groups 41
C. Social Benefits 42
D. Project Risks 42
E. Environmental Effects 42


.. /..





TABLE OF CONTENTS (Continued)

VOLUME II ANNEXES


1. The Agricultural Sector

2. Agricultural Research Services

3. Research Program for Farming Systems in the Semi-Arid
Tropics

4. Research Program in Farming Systems in the Humid
Tropics

5. Research Program for Farming Systems in the Campos Cerrados


National

National

National

National

National

National

National

National

National

National

National

National

National


Research Program for Rice


Research

Research

Research

Research

Research

Research

Research

Research

Research

Research

Research

Research


19. National Research


Program

Program

Program

Program

Program

Program

Program

Program

Program

Program

Program

Program

Program


for Beans

for Vegetables

for Fruits

for Coconut

for Oil Palm

for Babacu

for Rubber

for Forestry

for Basic Seed

in Agricultural Engineering

for Food Technology

for Bioenergy

for Animal Health


The Information and Documentation System for EMBRAPA

Civil Works and Development Costs

Project Cost Estimates








BRAZIL

AGRICULTURAL RESEARCH II PROJECT


PREFACE


i The Agricultural Research II Project proposes to continue to
strengthen 6 of the 12 EMBRAPA research programs covered under Agricul-
tural Research I Project, and to add 12 new research and research support
programs. Agricultural Research I Project, initiated in 1976 with
support from the World Bank (Loan Contract N* 1249-BR), is still operative
and has resulted in the experience and increased staff competence within
EMBRAPA that make feasible this proposal for a broadened research project.

ii This project proposal was developed by EMBRAPA with assistance
from the International Agricultural Development Service (IADS), between
May and July, 1980. The services provided by IADS, under a subcontract
with the Interamerican Institute of Agricultural Sciences (IICA), were
through a team of specialists consisting of Messrs. R. Desrosiers (peren-
nial crops of the tropics), E.R. Duncan (agriculture of the semi-arid
tropics), R.P. Bates (food technology), R.W. Etheredge (architect/planner),
and G.B. Baird (research administration).

iii The proposal is presented in two volumes, the first of which
contains the proposal per se. Volume II consists primarily of a detailed
description of each of the 18 research and research support programs, as
well as of the civil works and development costs, and of project cost
estimates.






Abbreviations


ABCAR Brazilian Association for Credit and Rural Assistance
Associaggo Brasileira de Credito e Assistencia Rural

ACAR Association of Credit and Rural Assistance
Associaggo de Cr6dito e Assistencia Rural

ARC Agricultural Research Center
Centro de Pesquisa Agropecuaria

ATA Technical and Administrative Advisory Office-EMBRAPA
Assessoria Tecnico-Administrativa

BEFLEX Brazilian Commission for Providing Fiscal Benefits to Special
Export Programs

BNB Bank of Northeastern Brazil
Banco do Nordeste do Brasil S.A.

CACEX External Commerce Bureau/Bank of Brazil
Carteira de Comercio Exterior/Banco do Brasil

CCA/UFC Agrarian Science Center of the Federal University of Ceara
Centro de CiGncias Agrgrias da Universidade Federal do Ceara

CEASA Supply Center
Centrals de Abastecimento

CENARGEN National Center of Genetic Resources-EMBRAPA
Centro Nacional de Recursos Geneticos

CENEA National Center of Agricultural Engineering
Centro Nacional de Engenharia Agricola

CEPLAC Executive Commission for the Cacao Production Plan
Comissao Executiva do Plano da Lavoura Cacaueira

CFP Commission of Production Financing
Comissao de Financiamento da Produgao

CIAT International Center for Tropical Agriculture
Centro Internacional de Agricultura Tropical

CIBRAZEM Brazilian Storage Company
Cia Brasileira de Armazenamento

CIMMYT International Center for the Improvement of Maize and Wheat
Centro Internacional de Mejoramiento de Maiz y Trigo

CIP International Potato Center
Centro Internacional de la Papa

CNEPA National Center for Agricultural Education and Research
Centro Nacional de Educagao e Pesquisa Agropecuaria




iii


CNPA National Center for Cotton.Research
Centro Nacional de Pesquisa de AlgodTo-EMBRAPA

CNPAF National Center for Research on Rice and Beans
Centro Nacional de Pesquisa do Arroz e Feij'o

CNPC National Center for Research on Goats and Sheep
Centro Nacional de Pesquisa de Caprinos-EMBRAPA

CNPGC National Center for Beef Cattle Research
Centro Nacional de Pesquisa de Gado de Corte-EMBRAPA

CNPGL National Center for Dairy Cattle Research
Centro Nacional de Pesquisa de Gado de Leite-EMBRAPA

CNPMF National Center for Research on Cassava and Fruits
Centro Nacional de Pesquisa de Mandioca e Fruticultura-EMBRAPA

CNPMS National Center for Research on Maize and Sorghum
Centro Nacional de Pesquisa de Milho e Sorgo-EMBRAPA

CNPSA National Center for Research on Swine and Poultry
Centro Nacional de Pesquisa de Suinos e Aves-EMBRAPA

CNPSe National Center for Research on Rubber
Centro Nacional de Pesquisa em Seringueira-EMBRAPA

CNPSo National Center for Research on Soybean
Centro Nacional de Pesquisa de Soja-EMBRAPA

CNPT National Center for Research on Wheat
Centro Nacional de Pesquisa de Trigo-EMBRAPA

CPAC Research Center for Agriculture in the Cerrados
Centro de Pesquisa Agropecuaria dos Cerrados-EMBRAPA

CPATSA Research Center for Agriculture in the Semi-Arid Tropics
Centro de Pesquisa Agropecuaria do Tr6pico Semi-Arido-EMBRAPA

CPATU Research Center for Agriculture in the Humid Tropics
Centro de Pesquisa Agropecuaria do Tr6pico Umido

COBAL Brazilian Food Company
Companhia Brasileira de Alimentos

COMPATER National Commission of Agricultural Research and Technical
Assistance in Rural Extension
Comissao Nacional de Pesquisa Agropecuaria e de Assistgncia
Tecnica de Extensto Rural

CTAA Center for Agriculture and Food Technology
Centro de Tecnol6gia Agricola e Alimentar-EMBRAPA

DDM Department of Planning
Departamento de Diretrizes e Metodos de Planejamento-EMBRAPA








DDT Department of Extension
Departamento de Difusao de Tecnologia-EMBRAPA

DFN Department of Finance
Departamento Financeiro-EMBRAPA

DID Department of Information and Documentation
Departamento de Informacgo e Documentagao-EMBRAPA

DMQ Department of Quantitative Methods
Departamento de M6todos Quantitativos-EMBRAPA

DNOCS National Department of Works Against Droughts
Departamento Nacional de Obras Contra as Secas

DPA Agricultural Information Directorate
Diretoria de Publicidade Agricola

DPE Department of Special Projects
Departamento de Projectos Especiais-EMBRAPA

DRH Department of Human Resources
Departamento de Recursos Humanos-EMBRAPA

DTC Department of Science and Technology
Departamento Tgcnico Cientifico-EMBRAPA

EMAPA Maranhao Agricultural Research Corporation
Empresa Maranhense de Pesquisa Agropecuaria

EMATER Technical Assistance and Rural Extension Corporation
Empresa de Assistencia Tecnica e Extensgo Rural

EMBRAPA Brazilian Agricultural Research Corporation
Empresa Brasileira de Pesquisa Agropecuaria

EMBRATER Brazilian Technical Assistance and and Extension Corporation
Empresa Brasileira de Assistencia Tecnica e Extensao

EMCAPA Capixaba Agricultural Research Corporation
Empresa Capixaba de Pesquisa Agropecuaria

EMGOPA Goidnia Agricultural Research Corporation
Empresa Goiania de Pesquisa Agropecuaria

EMPASC Santa Catarina Agricultural Research Corporation
Empresa de Pesquisa Agropecuaria de Santa Catarina

EPABA Bahia Agricultural Research Corporation
Empresa de Pesquisa Agropecuaria da Bahia

EPAMIG Minas Gerais Agricultural Research Corporation
Empresa de Pesquisa Agropecuaria do Estado de Minas Gerais


United Nations Food and Agriculture Organization


FAO








FAEM


FITIPAL


GOB


IADS

IAPAR


IDB


IICA


INCRA


INPA


IPEF


IRGA


IRRI

ITAL


PBCT


PND


PND II


PLANASEM


POLOAMAZONIA


POLOCENTRO


POLONORDESTE


Department of Agronomy of Eliseu Maciel
Faculdade de Agronomia Eliseu Maciel

Foundation for State-Level Research
Fundaggo de Pesquisa de Ambito Estadual

Government of Brazil

International Agricultural Development Service

Agronomy Institute of Parana
Institute Agron6mico do Parana

Inter-American Development Bank

Interamerican Institute of Agricultural Sciences
Institute Interamericano de Ciencias Agricolas

National Institute of Colonization and Land Reform
Institute Nacional de Colonizagco e Reforma Agrdria

National Institute of Research for Amazonia
Institute Nacional de Pesquisa da Amaz6nia

Institute of Forestry Research
Institute de Pesquisa e Estudos Florestais

Rio Grande Institute of Rice
Institute Riograndense do Arroz

International Rice Research Institute

Institute of Food Technology
Institute de Tecnol6gia de Alimentos

Basic Plan for Science and Technological Development

National Development Plan
Piano Nacional de Desenvolvimento

Second National Development Plan
II Plano Nacional de Desenvolvimento

National Seed Improvement Plan
Piano Nacional de Meihoramento da Semente

Development Program for the Integrated Areas of Amaz6nia
Program de Desenvolvimento de Areas Integradas da Amaz6nia

Development Program for the Integrated Central Areas
Program de Desenvolvimento de Areas Integradas do Centro

Development Program for the Integrated Areas of the Northeast
Program de Desenvolvimento de Areas Integradas do Nordeste'









PROACOOL National Alcohol for Fuel Program
Program Nacional do Alcool para Combustivel

PROCAL National Lime Program
Program Nacional da Cal

PRONAPA National Agricultural Research Program
Program Nacional de Pesquisa Agropecuaria

PRONAZEM National Storage Facilities Expansion Program
Program Nacional de Expans~'o de Armazem

PROPEC National Livestock Development Program
Program Nacional de.Desenvolvimento da Agropecuaria

SAGRIMA Maranhao Secretariat of Agriculture
Secretaria de Agricultura do Maranhao

SIBRATER National Technical Assistance and Rural Extension System

SNLCS National Soil Surveying and Conservation Center
Servigo Nacional de Levantamento e Conservaggo do Solo

SPSB Basic Seed Production Service
Servigo para Produgao de Sementes Basicas-EMBRAPA

SUDAM Superintendency for the Development of Amaz6nia
Superintendencia para Desenvolvimento da Amazonia

SUDENE Superintendency for the Development of the Northeast
Superintendencia para Desenvolvimento do Nordeste

UEPAE Unit of Research Execution at the State Level
Unidade de Execugao de Pesquisa de Ambito Estadual

UEPAT Unit of Research Execution at the Territorial Level
Unidade de Execugao de Pesquisa de Ambito Territorial

UFV Federal University of Vigosa
Universidade Federal de Viqosa

UFRRJ Federal Rural University of Rio de Janeiro
Universidade Federal Rural do Rio de Janeiro

UNB University of Brasilia
Universidade de Brasilia

UNICAMP University of Campinas
Universidade de Campinas

URPFCS Regional Unit for Forestry Research in the Central-South
Unidade Regional de Pesquisa Florestal Centr-Sul






Currency Equivalents

Currency Unit = Brazilian Cruzeiro (Cr$)
US$1 = Cr$ 50 (June, 1980)
1 Cr$ = US$ 0.02
Cr$1 million = US$ 20,000

Weights and Measures

m = meter (1 m = 3.28 feet)
2
sq m = square meter (1 m = 10.76 square feet)
km = kilometer (1 km = 0.62 miles)
2
ha = hectare (1 ha = 10,000 m = 2.47 acres)
2
sq km = square kilometer (1 km = 247.1 acres = 100 ha = 0.386 square miles)
3
cu m = cubic meter (1 m = 1.31 cubic yards = 264.2 US gallons)
kg = kilogram (1 kg = 2.2 Ib)
ton = 1,000 kg = 2.205 lb








VOLUME I

BRAZIL

AGRICULTURAL RESEARCH II PROJECT

1/
I. THE AGRICULTURAL SECTOR-


A. The Sector in the Economy


1.01 Brazil can be divided into five major ecological areas, which
follow fairly closely the five main geopolitical regions the North
(Amazonia), Northeast (semi-arid zone), Central-West (Campos Cerrados),
Southeast and South. The areas cover a range of climatic conditions
from the hot-humid tropics in the North, to the semi-arid tropics of the
Northeast, to the temperate zone in the South.

Importance of Agriculture

1.02 The country, essentially self-sufficient in agricultural produc-
tion (except for wheat), is the world's second most important exporter of
agricultural commodities. It consistently produces exportable supplies
of foodgrains, oilseeds, beverages, sugar, meat, tobacco and fibers.
In recent years, the role of growth in Brazil's food production has been
among the highest in the world. Production of all agricultural commodities
increased at an annual average rate of 3% between 1961-65 and 1971-75 while
the production of food products alone grew at a rate of nearly 5% per year.
The rate of growth during the period 1970-79 has ranged from a low of
-1.7% in 1978 to a high of 11.4% in 1971.

1.03 Despite its importance, agriculture in Brazil accounts for
only 10-11% of the GNP, down from 19.9% in 1960 and 16.1% in 1972. On
the other hand, agriculture accounts for more than 60% of the country's
foreign exchange earnings.

Exports

1.04 Export of agricultural commodities has shown a marked increase
over the period 1970-1977 although the share of agriculture in overall
exports has declined. Brazil's export sector was formerly dominated by
one commodity, coffee; but by 1975 its share of export earnings fell to 11%.
In recent years, accompanying the economic growth in the industrial sector,
agricultural exports have been greatly diversified. For example, export
of soybeans and soybean products was the country's largest foreign exchange
earner in 1975. Important agriculture-based processed items such as cotton
textiles and yarn, leather goods and twine have also contributed significantly.
Other less important but significant agricultural export items include wool,
molasses, sisal, horse meat, bananas, Brazil nuts, cashew nuts, pepper,
carnuba wax, and essential oils.


See Volume II, Annex 1 for further information.








VOLUME I

BRAZIL

AGRICULTURAL RESEARCH II PROJECT

1/
I. THE AGRICULTURAL SECTOR-


A. The Sector in the Economy


1.01 Brazil can be divided into five major ecological areas, which
follow fairly closely the five main geopolitical regions the North
(Amazonia), Northeast (semi-arid zone), Central-West (Campos Cerrados),
Southeast and South. The areas cover a range of climatic conditions
from the hot-humid tropics in the North, to the semi-arid tropics of the
Northeast, to the temperate zone in the South.

Importance of Agriculture

1.02 The country, essentially self-sufficient in agricultural produc-
tion (except for wheat), is the world's second most important exporter of
agricultural commodities. It consistently produces exportable supplies
of foodgrains, oilseeds, beverages, sugar, meat, tobacco and fibers.
In recent years, the role of growth in Brazil's food production has been
among the highest in the world. Production of all agricultural commodities
increased at an annual average rate of 3% between 1961-65 and 1971-75 while
the production of food products alone grew at a rate of nearly 5% per year.
The rate of growth during the period 1970-79 has ranged from a low of
-1.7% in 1978 to a high of 11.4% in 1971.

1.03 Despite its importance, agriculture in Brazil accounts for
only 10-11% of the GNP, down from 19.9% in 1960 and 16.1% in 1972. On
the other hand, agriculture accounts for more than 60% of the country's
foreign exchange earnings.

Exports

1.04 Export of agricultural commodities has shown a marked increase
over the period 1970-1977 although the share of agriculture in overall
exports has declined. Brazil's export sector was formerly dominated by
one commodity, coffee; but by 1975 its share of export earnings fell to 11%.
In recent years, accompanying the economic growth in the industrial sector,
agricultural exports have been greatly diversified. For example, export
of soybeans and soybean products was the country's largest foreign exchange
earner in 1975. Important agriculture-based processed items such as cotton
textiles and yarn, leather goods and twine have also contributed significantly.
Other less important but significant agricultural export items include wool,
molasses, sisal, horse meat, bananas, Brazil nuts, cashew nuts, pepper,
carnuba wax, and essential oils.


See Volume II, Annex 1 for further information.








Imports

1.05 Wheat usually accounts for one-third to one-half of Brazil's
agricultural imports (3.8 million tons in 1979). Other principal import
commodities have been live animals for breeding, temperate zone fruits
and nuts, milk and milk products, meat and seeds. Bad crop years because
of drouth result in periodic importations of small quantities of such
basic food crops as maize, rice and beans. In 1976 the value of food
imports was about US$ 1.1 billion while the corresponding value for
exports was approximately US$ 6.1 billion.

Crop Yields

1.06 While the rate of growth in agriculture has been remarkable,
it has resulted, for the most part, from increased area under cultivation
rather than improved yields. Yields of basic food crops, including
maize, rice, wheat, beans and cassava, have improved little, if any,
during the period 1969-1979. Since base yields of most of the principal
crops are low, a great potential exists for increased productivity
through improved technology.

Livestock

1.07 Brazilian cattle population, estimated at 90 million head in
1979, was reported to have increased to 93 million in early 1980.
Cattle slaughter was estimated at 10.7 million in 1979. The increase in
poultry during the past several years is notable. In general, beef
cattle production is range-based.

The Rural Population

1.08 The estimated population of Brazil in 1980 is about 123 million,
with some 44.8 million (36.5%) in the rural area. Since 1970 there has
been a strong shift of people from rural to urban areas. This has
important implications for agricultural development, including a need
for greater attention to mechanization of at least some farming operations.

1.09 There is a wide range in population densities among regions -
from 1.0 in the North to 43.9 inhabitants per sq km in the Southeast
(based on 1970 data). There is much less regional variation in the
proportion of the population in the rural areas. The Southeast is an
exception, having only about 27.5% while the other four have 50% or
more.


B. AGRICULTURAL DEVELOPMENT POLICY


1.10 The present administration has termed agriculture as the
priority sector in the economy. The government has begun to restructure
existing programs and implement new policies to boost short-term agricul-
tural production. From a long-term perspective, the new government has
formulated policies aimed at: (a) shifting the agricultural economy to
a greater reliance on the price mechanism rather than subsidized credit;








and (b) shifting government resource use to more needy farmers. The
primary production policy tools utilized have been a renumerative minimum
price program, subsidized loans to producers for production financing,
and financial support for research, extension, and development projects.

Minimum Prices

1.11 Each year before the planting season, the GOB announces a set
of minimum producer prices for the forthcoming crop season. The program
is administered by the Production Financing Commission (CFP), an agency
of the Ministry of Agriculture. For the past several years CFP's minimum
price program has set guaranteed floor prices for about 45 commodities.

1.12 Key direct and indirect benefits of the support price program
are: (a) utility to farmers in making planting decisions; (b) ensuring
stable long term minimum prices as a means of stimulating expanded
output of specific commodities; (c) encouraging the storage of excess
production at harvest for release between harvests; (d) providing a
safety valve of government acquisition for periods of low prices;
(e)providing relief to consumers from excessively high prices through
the release of government stocks, and (f) assisting livestock producers
who use purchased feeds by ensuring more stable prices and supplies.
This year, to spur the government's goal of increasing the planted area
by about 10 percent, minimum prices were increased substantially.

Credit

1.13 Subsidized credit has been one of Brazil's principal means of
encouraging rapid development of the agricultural sector. Basic annual
interest rates for agricultural credit in recent years have ranged
between 13 to 22%, although annual interest rates for loans granted
under the auspices of special sectorial and regional development programs
have been as low as 7%.

1.14 The present administration has been taking a close look at the
credit advantages the agricultural sector receives. Costs of the credit
program have risen greatly in recent years, in part because of the
growth in the use of agricultural credit as well as to inflation.
Government policies to combat inflation, including cutbacks in its
spending, will affect the amount of subsidized agricultural credit.
Development programs, such as SUDAM and SUDENE, are exempted from the
ensuing less favorable interest rates.

Production Loans

1.15 Several recent changes seek to shift the emphasis of production
loan programs. Foremost among these changes has been restructuring the
system for financing farmers' variable costs of production. Farmers
with higher yields potentially can receive more financing under the
assumption that more expensive inputs are necessary to achieve the
higher yields. The basic objective of the new policy is to give greater
market incentives to efficient producers while reducing their dependence
on subsidized credit. At the same time, assistance to small farmers is
being intensified in an attempt to reduce the income and regional dis-
parities within agriculture.








Research and Extension

1.17 The Government of Brazil is committed to the use of research
as an instrument leading to higher agricultural productivity. Institu-
tionally, the Brazilian Agricultural Research Corporation (EMBRAPA),
formed in 1973 within the Ministry of Agriculture, makes and implements
research policy. The organization, confronted initially with a lack of
highly trained agricultural researchers, has financed graduate education
for hundreds of researchers--both in Brazil and abroad. Many of these
students have completed their training and are now working throughout
the agricultural research community.

1.18 Organizationally, EMBRAPA employs the bulk of its resources at
national research centers devoted to specific commodity problems (e.g.,
the National Rice and Bean Center located in Goiana, Goias) and to
regional centers that focus on farming systems (e.g. the Cerrados station
near Brasilia). In addition, there are state-level agricultural research
institutions. The Rice Research Institute of the state of Rio Grande do
Sul (IRGA), for example, has a long and distinguished research record.
Currently, state research programs which meet the approval of EMBRAPA
receive a 50% subsidy from the national organization. Chapter II, AGRI-
CULTURAL RESEARCH, deals with EMBRAPA in detail.

1.19 Linking research results and technical assistance to farmers
is the charge of the Brazilian Corporation for Technical Assistance and
Rural Extension (EMBRATER). Under EMBRATER, the GOB seeks to coordinate
a national system for technical assistance and extension with the federal
entity setting overall policies for existing state services and coordinating
their activities.

Development Programs

1.20 The Government of Brazil also has established several programs
to assist certain agricultural sectors of the economy. The National
Livestock Development Program (PROPEC) provides farmers and ranchers
with low interest loans and technical assistance for improving pastures,
dairy and beef breeding stock, and production techniques. The Swine
Development Program is aimed at improving pork production and marketing
in southern Brazil. Other programs are directed at providing economic
incentives and technical assistance for advancing the production of
limestone (PROCAL), increasing agricultural storage capacity (PRONAZEM),
and production of alcohol for fuel (PROALCOOL).

1.21 In addition, Brazil has initiated several special regional
development programs largely devoted to agriculture. These programs
provide incentives for agricultural development of frontier or chron-
ically low income areas. Among the largest of these regional development
programs are POLONORDESTE, POLOAMAZONIA, and POLOCENTRO. The Program
for the Development of Integrated Areas of the Northeast (POLONORDESTE)
is aimed largely at increasing the agricultural growth rate in the
region by providing subsidized credits to farmers. Efforts also are
being made to improve storage facilities and the functioning of the
minimum price system in this chronically low income region. The
POLOAMAZONIA program is coordinating investment for agricultural and








mineral development in areas of the Amazon basin. SUDAM, the government's
development agency for the North, offers fiscal incentives for companies
and individuals to invest in agricultural products in the Amazon. Many
large livestock projects are being initiated as a result of these programs.

1.22 For the agricultural sector as a whole, the most important of
these integrated regional programs is POLOCENTRO, the program for the
development of the cerrados. The current administration believes that
much of Brazil's potential agricultural growth over the next several
years will come from opening the cerrados. For 1979, a total of Cr$1.8
billion (US$36 million) was allocated to the POLOCENTRO budget of which
agricultural research received 38%, rural electrification 19%, technical
assistance to farmers 15%, storage 14%, and roads 14%. According to
government officials, during the last 3 years POLOCENTRO has brought 2.4
million hectares of cerrado land into agricultural production including
970,000 hectares for crops, 963,000 hectares for pastures and 440,000
hectares for afforestation. Future efforts of the present administration
point toward expanding rice, wheat, and livestock production in the 15
percent of Brazil's surface area covered by cerrados.

Trade Policies

1.23 Brazil has used export incentive policies to foster growth in
agricultural exports largely by periodic mini-devaluations, tax
forgiveness, and tax credits for exports as well as subsidized credit to
pay for export operations. In a continuing effort to balance its trade,
Brazil has restricted imports of agricultural products for some time.


C. AGRICULTURAL SUPPORT SERVICES


1.24 Farmers, regardless of size of land holding, generally will
increase their productivity provided these requisites are met:

an improved farming system. A combination of materials and
practices that is clearly more productive and profitable,
with an acceptably low level of risk, than the one he currently
uses must be available to the farmer.

instruction of farmers. The farmer must be shown, on his
own farm or nearby, how to put the practices into use, and
he should understand why they are better.

supply of inputs. The inputs required, and, if necessary,
credit to finance their purchase, must be available to the
farmer when and where he needs them, and at reasonable cost.

availability of markets. The farmer must have access to a
nearby market that can absorb increased supplies without
excessive price drops.








These requisites to overall national agricultural development need to be
accompanied by education for agricultural development, production credit,
group action by farmers, improvement and expansion of agricultural land,
and national planning.

Research

1.25 EMBRAPA is responsible for coordination and promotion of
agricultural research throughout Brazil, and thus plays the primary role
in the development of improved farming systems for the diverse agricultural
areas of the country. It has its own network of regional and commodity-
oriented research centers, and operates directly at the state level
through a series of research stations (UEPAE's). Furthermore, EMBRAPA
has linkages with state-operated research institutions, universities,
and other research entities in both the private and public sector.
EMBRAPA, together with its linkage to other agricultural development
institutions, will be discussed in the following chapter.

Extension

1.26 The organization primarily responsible for instructing the
farmer in use of improved technology is the Brazilian Corporation for
Technical Assistance and Rural Extension (EMBRATER). EMBRATER's objective
is to provide national leadership to state extension companies (EMATERs)
which will result in the transfer and application of new agricultural
technology. EMBRATER, with headquarters in Brasilia, heads the National
Technical Assistance and Rural Extension System (SIBRATER), comprising
23 state extension institutions (formerly ACARS) that are being legally
reestablished as state extension companies (EMATERS). In 1976, there
were 1,789 local extension offices in operation and EMBRATER plans to
increase them to 2,080; and the number of technicians from 7,717 to
10,100 by the end of the 4-year period (1978-81).

Inputs

1.27 Important inputs to increased agricultural production include
fertilizers and other soil amendments, improved seed, plant protection
chemicals, and tractors and other implements that form part of farm
mechanization.

Fertilizers

1.28 The estimated demand for fertilizers (N,P,K) in 1980 is 4.0
million tons: 1.4 million tons of N, 1.6 million tons of P205 and 1.0
million tons of K20. In 1970 fertilizer use was about 979 thousand tons
consisting of 276 thousand tons of N, 396 thousand tons of P205 and 307
thousand tons of K20. More than half of the N and P205, and all of the
K20 has to be imported.

1.29 In the mid-1970's, Brazil subsidized farmers' purchase of
fertilizer by 40%, but because of the high cost to the government, and
the decline in the world price of fertilizers, the subsidy was eliminated
as of January 1977. In early January 1980, Brazil initiated a program
to subsidize fertilizer at the institutional level. Also, farmers will
be able to finance the purchase of fertilizers without interest for a
period of one year.








1.30 A specific Program for Agricultural Lime (PROCAL) has been
created to promote availability of crushed limestone to farmers. Currently
known deposits are limited and widely scattered, with consequent high
transportation costs to the agricultural areas where it is most needed.
The "cerrados" soils are particularly lime-deficient and the program is
expected to speed up agricultural development in this area. It is
estimated that 15 million tons of limestone will be required annually by
1980.

Improved Seed

1.31 The area cultivated and estimated seed need and demand for
selected crops for 1980 are as follows:

Estimated Demand
for
Area Cultivated Seed Needs Improved Seed
(1,000 ha) (ton) (1977-1979) tons
Rice 5,500 250,000 87,500
Beans 4,500 150,000 10,000
Maize 11,500 400,000 220,000
Soybeans 9,000 450,000 364,000
Wheat 4,000 320,000 281,000
Source: EMBRAPA

1.32 Currently, improved seed of several crops is produced in
Brazil, both by private firms and public or semi-public agencies. The
Government of Brazil has been acutely aware of the need to produce and
distribute improved seeds to ensure maximum returns from the application
of new technology to agricultural production. During the years 1963-69,
a National Seed Improvement Plan (PLANASEM) was put into operation under
the auspices of the Ministry of Agriculture. The plan was designed to
help develop seed production capacity in two distinct regions. For one
of the regions, which combined the South and Southeast, a seed production
program, with investments of some US$25 million during 1973-75, was
partly financed by the Inter-American Development Bank (IDB). Seed
improvement programs for the North, Northeast and Central-West are less
advanced, but the Ministry of Agriculture allocated funds to seed improve-
ment programs for these areas, to expand production over the 5-year
period, 1975-1979, of the Second National Development Plan (PND II).
The basic goal of all these programs is to make each region largely
self-sufficient in seed production and distribution.

1.33 EMBRAPA, through its Basic Seed Production Service (SPSB), has
a vital role to play in the production of improved seed. Through a
regional network of production, processing, storage and distribution
centers, SPSB is expanding both quantities and kinds of basic seed to
both private and public sector commercial seed producers. In the 1980's
particular attention will be given to seed needs in the North and Northeast
regions.








Pesticides

1.34 According to a government estimate, total use of agricultural
pesticides in Brazil in 1976 was 85,000 tons (principal agent) as compared
with 75,700 in 1975 and 92,840 in 1975. Consumption of insecticides and
fungicides in 1976 gained a little over 1975 but still was well below
1974 levels. Use of herbicides continued its upward trend mainly because
of soybean expansion.

Tractors

1.35 During 1978, about 44,500 four-wheel tractors were produced in
Brazil, a decrease over production for the preceding 3 years of 12% over
1975 production. Total tractor production, including crawler type,
mini-tractors, and motorized cultivators, totaled 54,800 in 1978.
Restrictions on credit availability have limited the number of tractors
sold, leaving manufacturers with unsold stock. Brazil has installed
capacity to double current production of tractors. Importation of
tractors is nominal.

Marketing

1.36 There are exceptions and limitations, but the marketing of
agricultural produce in Brazil is based upon free market principles. In
most cases producers are free to sell their produce to whomever they
please at the best price they can obtain. For a wide range of commodities,
producers can -- if they are not satisifed with market prices -- obtain
government minimum price support loans in order to allow them temporarily
to hold their product off the market. For some commodities government
interference in the market place restricts the flow of commerce.

1.37 The marketing of food and fiber products in Brazil is controlled
by a wide range of organizations ranging from truck owners to small
merchants to large multinational firms to producer cooperatives. The
relative importance of these different institutions varies from commodity
to commodity and from region to region. Many commodities such as dry
beans and rice (outside of Rio Grande do Sul) are collected and assembled
by thousands of truckers and small merchants. In the Center-South large
Brazilian and multinational firms are involved in the assembling, process-
ing and exporting of many commodities including soybeans, maize, coffee,
cotton, oranges and dairy products. Cooperatives play a key role in the
market for many commodities, especially soybeans and wheat.

1.38 Non-perishable commodities are traded at privately organized
central exchanges in the largest cities. These markets deal only in
spot trading. Futures marketing is not currently permitted but this is
expected to change in a year or two. Brazilian traders and cooperatives
do, however, trade on foreign futures markets.

1.39 The Ministry of Agriculture through its food company -- COBAL --
has made enormous strides in organizing and increasing the efficiency of
fresh produce marketing. This was done by setting up large central
markets (CEASA's) near all large cities. The establishment of these
modern market places has eliminated much of the confusion and inefficiency
previously associated with supplying the large metropolitan centers.








Storage

1.40 This activity is complementary to the programs described
above, particularly in the areas of price and stock regulation. The
Brazilian Storage Company (CIBRAZEM), another semi-autonomous enterprise
under the Ministry of Agriculture, is in charge of planning, building
and operating storage facilities, according to need, and in line with
policy decisions in the areas of rural development where agricultural
production increases rapidly. CIBRAZEM is also in charge of executing
the National Storage Facilities Expansion Program (PRONAZAM) which
commenced in 1975. The program's major goal is the expansion of storage
capacity for farm products from the then level of 37 million tons to
110 million tons by 1979.

Agricultural Education

1.41 In 1975 there were 40 institutions of higher learning offering
57 programs in the agricultural sciences. Most of the schools and
programs have been started in the last 15 to 20 years; few are older
than 30 years. Most animal husbandry, forestry and fisheries study
programs are of recent origin since, traditionally, only agronomy and
veterinary sciences were taught at the older institutions. Only within
the last 5 years has a degree course been offered in agricultural engineer-
ing. The majority of courses offered are at the undergraduate level.
Opportunities for graduate education are still concentrated in the South
and Southeast. Training capability to meet national requirements is
probably adequate at the undergraduate level, but there is still a
strong reliance on training abroad for advanced degrees for agricultural
research staff working in specialized fields.








I/
II. AGRICULTURAL RESEARCI-


A. EMBRAPA The Brazilian Agricultural
Research Corporation


Background

2.01 The development of agricultural research services has gone
through three periods. The first period ran from the late 19th Century
up to the mid-1940s, when plantation agriculture was at its peak, but
there was no defined farm policy to provide clear research objectives at
the federal level. Efforts were largely confined to the major export
crops such as coffee, cacao and sugar, and emphasis was clearly on
expanding the agricultural frontiers rather than increasing production
per unit area. This period ended as industrialization began to play a
more important role in economic policy. The second period went from the
mid-1950s to the mid-1960s when economic expansion of the industrial
base was a clear prerogative and allocation of resources, away from
agriculture, resulted in less support for this sector, particularly its
research institutions. With the gradual withdrawal of support from
institutions, at both the federal and state levels, several went out of
existence entirely and research activity was severely curtailed at
others.

2.02 The third period, which began in the early 1960s and continues
to the present, is characterized by a broader understanding of the role
of agriculture in economic development. It has been recognized that
expansion of the agricultural frontier alone cannot continue to meet
demands from both domestic and foreign markets and that higher produc-
tivity per unit area must be part of agricultural policy and goals in
the future. In 1962, the Ministry of Agriculture was reorganized and
rural universities became autonomous. As a result, agricultural education
and research were no longer subordinate to a single administration. The
old National Center for Research and Agricultural Education (CNEPA) was
disbanded and its research duties taken over by the Department of Agricul-
tural Research and Experimentation (DPEA). In 1970, three more institutes
were added and the Department moved from Rio to Brasilia. The name was
changed to Office of Research and Experimentation (EPE), but in 1971 it
became the National Department for Agricultural Research (DNPEA). This
Department again had six divisions and nine regional research institutes.




S See Volume II, Annex 2 for further information.








I/
II. AGRICULTURAL RESEARCI-


A. EMBRAPA The Brazilian Agricultural
Research Corporation


Background

2.01 The development of agricultural research services has gone
through three periods. The first period ran from the late 19th Century
up to the mid-1940s, when plantation agriculture was at its peak, but
there was no defined farm policy to provide clear research objectives at
the federal level. Efforts were largely confined to the major export
crops such as coffee, cacao and sugar, and emphasis was clearly on
expanding the agricultural frontiers rather than increasing production
per unit area. This period ended as industrialization began to play a
more important role in economic policy. The second period went from the
mid-1950s to the mid-1960s when economic expansion of the industrial
base was a clear prerogative and allocation of resources, away from
agriculture, resulted in less support for this sector, particularly its
research institutions. With the gradual withdrawal of support from
institutions, at both the federal and state levels, several went out of
existence entirely and research activity was severely curtailed at
others.

2.02 The third period, which began in the early 1960s and continues
to the present, is characterized by a broader understanding of the role
of agriculture in economic development. It has been recognized that
expansion of the agricultural frontier alone cannot continue to meet
demands from both domestic and foreign markets and that higher produc-
tivity per unit area must be part of agricultural policy and goals in
the future. In 1962, the Ministry of Agriculture was reorganized and
rural universities became autonomous. As a result, agricultural education
and research were no longer subordinate to a single administration. The
old National Center for Research and Agricultural Education (CNEPA) was
disbanded and its research duties taken over by the Department of Agricul-
tural Research and Experimentation (DPEA). In 1970, three more institutes
were added and the Department moved from Rio to Brasilia. The name was
changed to Office of Research and Experimentation (EPE), but in 1971 it
became the National Department for Agricultural Research (DNPEA). This
Department again had six divisions and nine regional research institutes.




S See Volume II, Annex 2 for further information.








Establishment of EMBRAPA

2.03 In 1972, a government group was formed to study agricultural
policy and propose institutional reforms, and, as a result of its recom-
mendations, the Empresa Brasileira de Pesquisa Agropecuaria -Brazilian
Agricultural Research Corporation (EMBRAPA) was organized late that same
year. It started operations on April 26, 1973. EMBRAPA is a public
sector corporation attached to the Ministry of Agriculture, with financial
and administrative authority.

2.04 The statutes of EMBRAPA are contained in Law No. 5,851 of
December 7, 1972, which outlines the agency's main functions as follows:
(a) direct, control and execute agricultural research activities for the
purpose of producing new technology for the development of national
agricultural production; (b) assist the federal executive branch, and
its entities, in technical and administrative matters related to the
agricultural sector; (c) stimulate and promote the decentralization of
research activities to the benefit of state and local interests; (d)
provide technical coordination of research projects, the execution of
which involves the technical-administrative services of other federal
agencies, (e) maintain close contact and coordination with the Brazilian
Technical Assistance and Rural Extension Corporation (EMBRATER) to
effectively execute diffusion of research results and technology, and
(f) plan, program and budget research activities to reflect the guidelines
and policies established by the National Commission for Agricultural
Research, Technical Assistance and Rural Extension (COMPATER).

2.05 Basically, EMBRAPA's research program aims at implementing
government policies as to the development of technology to increase
agricultural production and productivity, and per capital income of
farmers. This means the expansion of domestic food supply, the increase
of commodities exports and therefore the betterment of rural populations.
EMBRAPA not only carries out research necessary to fulfill its mandate,
but is responsible for coordinating the overall national agricultural
research program which involves many public and private sector institutions
outside of EMBRAPA.

2.06 Based on experience in the 1970s, specific research areas have
been identified by EMBRAPA for special attention in the 1980s. These
are: evaluation and improved management of natural resources (soils,
water and climate) in the farmed areas as well as in the agricultural
frontier areas; integrated control of agricultural pests, diseases and
weeds; crop and animal improvement; phosphorus as a critical basic
nutrient; biological fixation of nitrogen; micronutrients, crops for
production of alcohol and fuel oil; agro-industry technology; irrigation;
rural administration; social sciences; animal health; and conservation
of natural resources.

Organization

2.07 EMBRAPA, headquartered in Brasilia, is headed by a Board of
Directors consisting of the President and three Executive Directors.
The offices of the headquarters consist of: the Presidency, the Technical
and Administrative Advisory Office (ATA), the Advisory Office for Inter-
national Cooperation (ACI), and the Legal Advisory Office (AJU). There
are nine departments at headquarters:








Department
Department
Department
Department
Department
Department
Department
Department
Department


Planning DDM
Special Projects DPE
Science and Technology DTC
Diffusion of Technology DDT
Information and Documentation DID
Human Resources DRH
Quantitative Methods DMQ
Finance DFN
General Administration DPA


2.08 Research programs are executed by EMBRAPA through a network of
national and regional research centers, and state and territorial experiment
stations. EMBRAPA also cooperates with state-level research corporations
that are attached to their own state department of agriculture.

Research Station Network

2.09 EMBRAPA has 11 national commodity-oriented research centers
that search for new concepts, planting materials and technologies,
aiming at agricultural production systems for a limited number of high
priority commodities, for the domestic food and foreign markets. These
centers are as follows:

CNPA for cotton, at Campina Grande, Paraiba
CNPAC for rice and beans, at Goiania, Goias
CNPC for sheep and goats, at Sobral, Ceara
CNPGC for beef cattle, at Campo Grande, Mato Grosso do Sul
CNPGL for dairy cattle, at Agua Limpa, Minas Gerais
CNPMF for cassava and fruit, at Cruz das Almas, Bahia
CNPMS for maize and sorghum, at Sete Lagoas, Minas Gerais
CNPSe for rubber, at Manaus, Amazonas
CNPSo for soybeans, at Londrina, Parana
CNPSA for swine and poultry, at Concordia, Santa Catarina
CNPT for wheat, at Passo Fundo, Rio Grande do Sul.

2.10 There are four regional research centers:

CPAC for the 'cerrados' region, at Planaltina, Brasilia, D.F.
CPATSA for the semi-arid tropics, at Petrolina, Pernambuco
CPATU for the humid tropics, at Belem-Para
URPFCS the Regional Unit for Forestry Research in the Central-
South, at Colombo, Parana.

The first three survey and evaluate natural, economic and social resources
over specific ecological regions, in order to improve actual farming systems
and develop new and better ones. URPFCS operates under the National Program
for Forestry Research. It aims at increasing fields of forest tree crop
species, improving the quality of forest products and rational utilization
of native forests.

2.11 State and territory agricultural experiment stations are run
directly by EMBRAPA. They test planting materials and technologies
under local conditions, received directly from the National and/or







Regional Centers. The state stations are referred to as UEPAEs and
correspondingly ones in territories are UEPATs. Currently there are
16 UEPAES and 1 UEPAT.

2.12 EMBRAPA also has four centers or services that support or
supplement the overall research system. They are:

CENARGEN: National Center of Genetic Resources
CTAA: National Center for Food Technology
SNLCS: National Service of Soil Surveying and Conservation
SPSB: Service for the Production of Basic Seed

2.13 State departments of agriculture have their own research
programs that are operated through state companies (corporations).
These state systems chiefly carry out on-farm research, testing and
adapting to local conditions results and planting materials emanating
from the national research centers. There are now 11 state research
companies. There are also integrated research programs in the states of
Sao Paulo, Parana and Rio Grande do Sul.

Program

2.14 The growth in agricultural research since the creation of
EMBRAPA is shown in the increase in number of research projects as
follows:

1974 552 projects
1975 1,092 "
1976 1,143 "
1977 2,220 "
1978 2,402 "
1979 2,648 "
1980 2,970 "

The projects for 1980 are distributed among the major physiographic regions
of the country as follows: North 185, Northeast 777, Southeast 775,
South 708 and Central-West 545.

Planning and Evaluation

2.15 The National Program of Agricultural Research (PRONAPA), which
is coordinated by EMBRAPA, was organized in 1974. A description of the
annual coordinated national program of agricultural research is published
and entitled "PRONAPA." It is the result of an annual planning exercise
coordinated by EMBRAPA which includes participation by scientists in the
many public and private sector institutions engaged in research concerned
with agriculture. Also included is representation from agencies dealing
with cooperatives, agricultural credit, extension, and regional development,
among others.

2.16 Based on experience since 1974, EMBRAPA in late 1979 comprehen-
sively reviewed methodology for the planning and evaluation of the
national agricultural research program. A revised system has been
developed which will replace the "linear" process used previously. The
new process, termed "circular programming model" places greater emphasis
on decision-making at all levels in the research system, rather than








primarily at the higher echelons, and on feedback at all times and at
all levels. The decision to strengthen program planning and evaluation
reflects the growing scientific and administrative capacity of EMBRAPA
personnel.

Staff

2.17 In 1978, EMBRAPA had a staff of 5,590, of which 1,220 were
researchers and 4,370 were auxiliary and administrative personnel. The
staff of the National Agricultural Research System included 2,000
researchers. Of this total, 1,226 had, since 1974, started graduate
courses (both Master and Ph.D. programs) at universities in Brazil and
abroad. Early in 1978, 482 had already returned to their field research
activities at EMBRAPA. EMBRAPA's post-graduate project, from which
several institutions have already profited, is the greatest effort ever
made in such a short period of time by any one such institution in the world.

2.18. In 1979 EMBRAPA had 503 technical and scientific staff at its
various research and service centers. This group consisted of 52 with
the Ph.D., 321 with the M.S., and 130 with the B.S. The total staff at
these locations, including supporting, was 2,506. On a regional basis
scientific and technical staff were distributed as follows: North -
120, South 522, Central West 186, Northeast -367, and Southeast -
482.

Finances

2.19 The budget for EMBRAPA (adjusted to the economic index of 100
for January 1980) was Cr$1,238.26 million (US$24.8 million) in 1974.
This figure had risen to Cr$4,450.20 million (US$89.0 million) for 1980.
EMBRAPA's long-range development plans for 1977-80 called for substantial
expenditures based on two regional projects--a World Bank agricultural
research loan (1249-BR) of US$40.0 million, which provides partial financing
for a total of 12 research programs concentrated in the North, Northeast
and Central-West, and an IDB loan of US$66.0 million for the PROCENSUL
research program, which concentrates on the areas of the Center-South,
Southeast, and South but excluding the 'cerrados' area.which comes under
the previously mentioned Agricultural Research I Project. These two
projects have total projected costs of US$189.4 million and 198.0 million,
respectively, for a total of US$387.4 million. Additional inputs from
regional development program funds, such as POLONORDESTE; POLOCENTRO and
POLAMAZONIA, bring total budgeted expenditures to over US$400.00 million.

Results

2.20 In 1978, 5 years after the initiation of EMBRAPA, significant
research results have been obtained. Notable among these are:

cerrados: research has produced information which will
permit an improvement in or introduction of other crops in
the cerrados, mainly rice, beans, maize, sorghum, cassava,
wheat, soybean, and citrus fruits.









sorghum: EMBRAPA is carrying out an intensive research
effort on the different types of sorghum, including sweet
sorghum, which appears to be one of the most promising
possibilities as a renewable source of alcohol.

maize: EMBRAPA has already obtained seven new cultivars of
maize, which combine more advantageous characteristics than
those of existing cultivars, particularly of farming in new
agricultural lands.

cassava: four cultivars of cassava which are resistant to
bacteriosis a restrictive disease can help increase
cassava productivity in Brazil by 40% in the short term.

rubber: in cooperation with SUDHEVEA, new production tech-
niques for Hevea brasiliensis are already available to
farmers. These techniques can permit an increase of 20,000
tons of rubber, a two fold expansion of production in 2 years.

soybean: the development of three new soybean cultivars
--BR-1, BR-2 and BR-3 -- is contributing significantly to
the increase in productivity in the Southern Region.

wheat: scientists at EMBRAPA have already identified agri-
cultural production systems for wheat which enables the
farmer to increase yield per ha by about 300 kilograms.

dairy cattle: the new production system for dairy cattle,
which can be immediately incorporated by farmers, will
enable them to obtain 10.5 kg of milk per cow/day, while the
average production for the Southeast is 3.5 kg.


B. Interactions With Other Agricultural Services


2.21 EMBRAPA considers research as a continuum that starts in a
research project seeking an answer to an agricultural problem that
originates with a farmer and ends with the farmer, when he puts into
practice the results of research in order to increase his productivity
and income. Thus EMBRAPA deems it essential that all useful research
results be made available to and used by farmers. To this end EMBRAPA
must work closely with a number of other organizations that also are
concerned with accelerated agricultural development-- Included are
organizations concerned with extension, inputs, credit, marketing, and
area development, and national commodity-oriented production projects.

Extension

2.22 EMBRAPA works closely with the Brazilian Corporation for
Technical Assistance and Extension (EMBRATER) both at the national and
state levels. The National Commission of Agricultural Research and
Technical Assistance (COMPATER) has been set up as the coordinating link


-- Relatorio Anual EMBRAPA 1979








between EMBRATER and EMBRAPA, and is responsible at the federal level
for synchronizing, reviewing and coordinating the programs of both
agencies.

2.23 Improved agricultural production systems are a major instrument
for facilitating cooperation between EMBRAPA and EMBRATER. The farming
systems program forms one of the major direct links in the system of
dissemination of information obtained at the research level. Indeed
most of the projects carried out under the program have research and
extension staff inputs, with the former usually from National Commodity
Centers involved, the local research station at the state level (UEPAE)
or, on occasion, both will participate in the experimental layout prepara-
tion and publication of the results in a technical bulletin, or informative
brochure, describing production methods used and results which may be
attained under the particular farming system. The main objective of the
program is to speed up adoption of new technology at the farm level, and
to keep production practices as current as possible with research results.

2.24 EMBRAPA also has extension type programs with cooperatives and
other grower's organizations; integrated programs, in Sao Paulo, Rio
Grande do Sul and Parana States; and multi-institutional programs and
projects, such as The National Alcohol Program, National Program of
Forestry Research, National Project of Agrometerology, National Research
Program in Animal Health, National Program of Soil Conservation, Integrated
Project for the Control of Pastures Spittle Bugs, and Research Project
in Drying and Storage.

Seed

2.25 EMBRAPA, through its Basic Seed Production Service (SPSB), is
closely associated with both public and private sector components of the
national seed program. Furthermore, its researchers have a direct role
in the development of new varieties of all of the crops covered by
EMBRAPA.

Other National Institutions

2.26 In the annual exercises leading to the National Agricultural
Research Program (PRONAPA), EMBRAPA involves participants from integrated
rural development programs, universities, agricultural credit organizations,
private enterprise and other interested entities.

International Links

2.27 In the field of international technical and scientific coopera-
tion, EMBRAPA has developed various multilateral and bilateral programs.
Among multilateral programs, the activities carried out in cooperation
with the Interamerican Institute for Agricultural Science (IICA); United
Nations Food and Agricultural Organization (FAO); International Center
for the Improvement of Maize and Wheat (CIMMYT, Mexico); International
Tropical Agriculture Centers (CIAT, Colombia, and IITA, Nigeria); Inter-
national Rice Research Institute (IRRI, the Philippines); and the Inter-
national Potato Center (CIP, Peru) are noteworthy. Bilateral cooperation
includes agreements with the Federal Republic of Germany, the United States,




17



Japan, and Canada. Other agreements are being prepared with France,
Australia, the Netherlands, Great Britain, and Israel. EMBRAPA also
gives technical assistance in soil analysis to Guinea Bissau and Cape
Verde.








III. THE PROJECT


A. Introduction


3.01 In 1976 the Agricultural Research I Project was initiated with
World Bank support (Loan Contract N 1249-BR) which assisted EMBRAPA to
strengthen its capability for research programs on nine commodity groups
(beans, cassava, cotton, maize/sorghum, rice, rubber, beef cattle, dairy
cattle, and sheep/goats). This project also provided for strengthening
of farming systems in three agro-ecological areas, namely: (a) the
densely populated, but agriculturally poor, Northeast where drouths
create acute social and economic problems; (b) the North (Amazonia),
where there is limited knowledge of the vast agricultural potential; and
(c) the Central-West, or campos cerrados, an area of rolling savanna
with generally infertile soils, which is also being rapidly opened to
human settlement.

3.02 The proposed Agricultural Research II Project is intended to
provide continuing assistance through EMBRAPA for further strengthening
of research on several of the same commodities and the same three farming
systems programs covered under the Agricultural Research I Project. The
proposed project includes a number of additional research programs as
well as provisions for strengthening of two services supportive of or
complementary to the research programs.


B. Objectives and Scope


3.03 EMBRAPA has primary responsibility for the national agricultural
research program, with key roles both in coordination and implementation.
In these roles it is concerned with the generation and utilization of
improved technology to meet the needs of agricultural development, in
accordance with the overall national plans for economic development.
The objectives of the proposed project are to strengthen the roles of
EMBRAPA, with respect to specific research and research supporting
programs.

3.04 Geographically the project is concerned primarily, but not
entirely, with the North, Northeast and Central-West regions that comprise
about 80% of the country's land area and some 40% of the total population.
This part of the country has great potential for agricultural development,
but, compared to the South and Southeast, has received little attention
in the past, and in general is characterized by an agriculture little
influenced by modern technology.

3.05 Under the proposed project there are 18 programs of which 16
are on research. The other two are concerned with the supply of basic








III. THE PROJECT


A. Introduction


3.01 In 1976 the Agricultural Research I Project was initiated with
World Bank support (Loan Contract N 1249-BR) which assisted EMBRAPA to
strengthen its capability for research programs on nine commodity groups
(beans, cassava, cotton, maize/sorghum, rice, rubber, beef cattle, dairy
cattle, and sheep/goats). This project also provided for strengthening
of farming systems in three agro-ecological areas, namely: (a) the
densely populated, but agriculturally poor, Northeast where drouths
create acute social and economic problems; (b) the North (Amazonia),
where there is limited knowledge of the vast agricultural potential; and
(c) the Central-West, or campos cerrados, an area of rolling savanna
with generally infertile soils, which is also being rapidly opened to
human settlement.

3.02 The proposed Agricultural Research II Project is intended to
provide continuing assistance through EMBRAPA for further strengthening
of research on several of the same commodities and the same three farming
systems programs covered under the Agricultural Research I Project. The
proposed project includes a number of additional research programs as
well as provisions for strengthening of two services supportive of or
complementary to the research programs.


B. Objectives and Scope


3.03 EMBRAPA has primary responsibility for the national agricultural
research program, with key roles both in coordination and implementation.
In these roles it is concerned with the generation and utilization of
improved technology to meet the needs of agricultural development, in
accordance with the overall national plans for economic development.
The objectives of the proposed project are to strengthen the roles of
EMBRAPA, with respect to specific research and research supporting
programs.

3.04 Geographically the project is concerned primarily, but not
entirely, with the North, Northeast and Central-West regions that comprise
about 80% of the country's land area and some 40% of the total population.
This part of the country has great potential for agricultural development,
but, compared to the South and Southeast, has received little attention
in the past, and in general is characterized by an agriculture little
influenced by modern technology.

3.05 Under the proposed project there are 18 programs of which 16
are on research. The other two are concerned with the supply of basic








III. THE PROJECT


A. Introduction


3.01 In 1976 the Agricultural Research I Project was initiated with
World Bank support (Loan Contract N 1249-BR) which assisted EMBRAPA to
strengthen its capability for research programs on nine commodity groups
(beans, cassava, cotton, maize/sorghum, rice, rubber, beef cattle, dairy
cattle, and sheep/goats). This project also provided for strengthening
of farming systems in three agro-ecological areas, namely: (a) the
densely populated, but agriculturally poor, Northeast where drouths
create acute social and economic problems; (b) the North (Amazonia),
where there is limited knowledge of the vast agricultural potential; and
(c) the Central-West, or campos cerrados, an area of rolling savanna
with generally infertile soils, which is also being rapidly opened to
human settlement.

3.02 The proposed Agricultural Research II Project is intended to
provide continuing assistance through EMBRAPA for further strengthening
of research on several of the same commodities and the same three farming
systems programs covered under the Agricultural Research I Project. The
proposed project includes a number of additional research programs as
well as provisions for strengthening of two services supportive of or
complementary to the research programs.


B. Objectives and Scope


3.03 EMBRAPA has primary responsibility for the national agricultural
research program, with key roles both in coordination and implementation.
In these roles it is concerned with the generation and utilization of
improved technology to meet the needs of agricultural development, in
accordance with the overall national plans for economic development.
The objectives of the proposed project are to strengthen the roles of
EMBRAPA, with respect to specific research and research supporting
programs.

3.04 Geographically the project is concerned primarily, but not
entirely, with the North, Northeast and Central-West regions that comprise
about 80% of the country's land area and some 40% of the total population.
This part of the country has great potential for agricultural development,
but, compared to the South and Southeast, has received little attention
in the past, and in general is characterized by an agriculture little
influenced by modern technology.

3.05 Under the proposed project there are 18 programs of which 16
are on research. The other two are concerned with the supply of basic








seeds, and with EMBRAPA's information and documentation system. Three
of the research programs are on farming systems in the North, Northeast
and Central-West, 10 are commodity-oriented, and 3 on broad-based problems
supportive of agricultural and overall economic development agricul-
tural engineering, food technology and bioenergy.


C. Detailed Features


Research Programs for Farming Systems

3.06 Programs have been designed for farming systems research in the
three agro-ecological areas covered by this project as well as by Agricul-
tural Research I Project. Each program will be headquartered at the
respective regional research centers of EMBRAPA CPAC, CPATSA and
CPATU. Building on results obtained during the past 5 years, the farming
systems research programs will continue to develop technology needed to
increase agricultural production and productivity through more efficient
overall use of available resources. Farming systems research will
continue to evaluate the regional natural resource bases, including
socio-economic aspects. Particular attention will be given to systematic
characterization of existing farming systems, as a basis for development
of improved systems, that will be acceptable to the farmers. The farming
systems research programs will build on technology generated by the
commodity-oriented centers, and in turn, will provide feedback to those
centers. Links will be strengthened between the farming systems research
programs with federal and state level organizations in the regions that
have direct roles in agricultural development. These research programs
are described in detail in Volume II, Annexes 3-5.

The National Commodity Research Programs

3.07 This project would directly strengthen 10 commodity-oriented
research programs: rice, beans, vegetables, fruits, coconuts, African
oilpalm, babacu, rubber, forestry and animals (through a national research
program on animal health). Three of these programs -- rice, beans and
rubber were directly covered under Agricultural Research I Project.
Indirectly, all programs included in the latter project are covered in
the one proposed through the regional farming systems research programs
and, in the case of animals, through the new animal health program,
which would be headquartered in Brasilia. A regional or national network
of stations is associated with each commodity-oriented research program
in order to insure development of technology appropriate for the full
range of conditions involved. Short-term goals include improved varieties
and management practices for the individual commodities. Considerable
progress in this regard has been made under Agricultural Research I
Project. Longer range goals include development of materials and practices
that fully integrate into the range of farming systems which include a
given commodity. These research programs are described in detail in
Volume II, Annexes 6-14 and 19.








A National Research Program for Agricultural Engineering

3.08 Increasingly, there is a need to strengthen research in the
engineering aspects of agricultural production, harvesting, and processing.
Land going into agriculture is proceeding at a rate higher than that for
population growth, and there is a marked trend toward movement of people
from the rural to the urban areas. These conditions are causing greater
attention to be given to mechanization, particularly of the production
aspects of agriculture. This new program, to be headquartered at EMBRAPA,
Brasilia, would involve linkages among a wide range of public and private
sector organizations interested in agricultural engineering, particularly
in farm mechanization. This program is discussed in detail in Volume
II, Annex 16.

A National Research Program for Food Technology

3.09 Efficient use of increased production of food crops requires
attention to post-harvest handling, including storage, processing, and
utilization. The already strong food technology industry of the South
and Southeast needs to be balanced by corresponding services in the
North, Northeast and Central-West. This new program proposes to facilitate
that by development of a national coordinated research program, based at
CTAA in Rio de Janeiro, which will build on experience gained in the
South and Southeast. This program is described in Volume II, Annex 17.

A National Research Program for Bioenergy

3.10 Brazil gives high priority to production of biomass-based
fuels as substitutes for those derived from imported petroleum. Produc-
tion of fuel ethanol from sugarcane and cassava is increasing rapidly,
and plans are underway to include other crops as raw materials (e.g.
sweet sorghum and sweet potatoes). Vegetable-based oils are expected to
substitute for diesel fuel, and biogas production is receiving attention.
Improved biomass production and.processing technology is urgently needed
to bolster Brazil's effort to increase production of fuels to substitute
for petroleum. In response to this need EMBRAPA proposes a national
program, headquartered at Brasilia, which would capitalize on its facil-
ities at five existing stations. The program is described in Volume II,
Annex 18.

A National Program for Basic Seed

3.11 EMBRAPA has a dominant role in the development of improved
varieties of a range of crops. It also is the chief producer of basic
seed of these crops, through its Basic Seed Production Service (SPSB),
headquartered in Brasilia, with 10 dispersed units for production,
processing, storage and distribution. The proposed program would strengthen
the role of SPSB through the addition of three new basic seed units
designed to meet the heretofore neglected needs of the North, Northeast
and Central-West. Further, SPSB would be able to include additional
important crops in its program. This program is discussed in detail in
Volume II, Annex 15.










Information and Documentation


3.12 EMBRAPA's success will depend on the technology it generates,
and the extent to which that technology is used by farmers, and thus
reflected in increased agricultural production and rural welfare. The
Information and Documentation Department of EMBRAPA (DID) has an important
role in the generation of technology (through flow of information to
researchers from both within and outside of the country) and flow of
information from the researchers to the various clients, including
EMBRATER. The proposed program would strengthen DID in both of its
primary functions. The program is discussed in Volume II, Annex 20.


Manpower Summary and Main Features

3.13 Proposed incremental staff, fellowships and consultants for
the 18 major research and research support programs to be financed under
the project are summarized in the following table.


Annex Research Program
Number


Headquarters
Station


Other Funded Techi
Stations Consultants
(Man Years)
Long Short
Term Term


lical Services
Fellowships
(Man Years)
PhD Mac Short
Term


Incremental Staff
.(Number of Employees)
Senior Junior Support Total


Semi Arid Tropics
Humid Tropics
Campos Cerrados
Rice
Beans
Vegetables
Fruits
Coconut
African Oil Palm
Babacu
Rubber
Forestry
Basic Seed
Agricultural Engineering
Food Technology
Bioenergy
Animal Health
Info. & Documentation


Petrolina
Belem
Planaltina
Goiania
Goiania
Brasilia
Cruz Das Almas
Aracaju
Manaus
Teresina
Manaus
Colombo
Brasilia
Brasilia
Rio de Janeiro
Brasilia
Brasilia
Brasilia


TOTAL


6 41.5 2 76 108 49 23 40 236 299
4 7 8.1 80 84 16 5 11 84 100
S 12 66 36 16 10 15 100 125
5 1 20 10 5 1 8 11 20
7 0.75 20 20 3 1 6 6 13
4 1 2 48 12 5 7 10 13 30
3 15 10 4 6 6 63 75
S1 7 2 4 3 2 26 31
-5 21 20 8 5 6 57 68
S 10 2 12 2 5 2 37 44
2 4 15 16 7 -
3 12 50 66 27 13 5 94 112
9 2 48 16 9 15 12 77 104
5 10 4 8 24 4 8 11 100 119
- 1 1.75 10 12 10 12 7 27 46
5 31 6 22 8 2 21 7 149 177
5 5 70 70 5 13 30 43 66
S4 4 16 80 5 2 4 35 41

154.5 38.6 592 606 181 150 1 .2 1158 1490
















D. Project Costs



3.14 Total project cost is estimated to be US$200 million of which
about 38% represents the foreign exchange component. The project cost
summary table is shown below. Details may be found in Annexes 21 and
22.


I. DEVELOPMENT COSTS

Civil Works
Vehicles & Farm Equipment
Office & Laboratory Equipment
Library & Documentation Services
Research Farm Development
Land Purchase
Subtotal I
II. TECHNICAL ASSIST-LCES COSTS

Consultants
Fellovships
Other Assistance Cost
Subtotal II
III. ::"CS.R AL OP EPJATI0AL CCSTS

Salaries & Wanes
Other Operational Cost
Subtotal III

V:. PROJECT BASE COST

V. CONIJGsICIES
Physical Contingencies
Price Contingencies
Subtotal V


PROJECT COST SoMARY
June 1, 1980

Crueiros Millions Roundd e
Local Foreign Total


930.0
200.0
160.0
165.0
125.0
20.0
1600.0


75.0
270.0
35.0
380.0


1660.0
7390.0
2390.0


235.0
65.0
370.0
390.0
30.0



TOO-
1090.0


700.0
370.0
275.0
1345. 0



205.0
205.0


1165.0
265.0
530.0
555.0
155.0
20.0
2690.0


775.0
660.0
310.0
1725.0


1660.0
935.0
2595.0


US $ Millions Rounded Of
Local Foreign Total .%x ase Cost


18.6
4.0
3.2
3.3
2.5
0.1
32.0


1.5
5.14
0.7
7.


33.2
1',.6
17.5


4.7 23.3
1.3 5.3
7.k 10.6
7.3 11.1

0.6



14.o 15.5
7.6 12.8
5.5 6.2
695 34.5


S 33.2
1.1 18.7
I4.1 51.9


90 11
58 9
90 5
=7 25


24
22 13
- 77T


u264o.o 7010.0 o7. 52.8 i ho.2 _8 I O


175.0
1705.0
1880.0


80.0
1030.0
1110.0


255.0
2735.0
2990.0


3.5
31.12
37.6


1.6
20.6
22.2


19 1
38 39
37. 43


6250.0 3750.0 10.000.0


y us $ 1.00 = cr $50.0








3.15 Development costs represent about 38% of the project base cost
or US$53.8 million. Around 43% of development cost would represent the
civil works component, or a total of US$23.3 million. A detailed breakdown
of proposed civil works may be found in Annex 21 Table 2.

3.16 Civil works cost estimates are based on physical facilities
estimated to be required to support research programs and accommodate
numbers of incremental staff in these programs. The list of proposed
physical facilities may be found in Annex 21 Table 1. Unit cost estimates
represent averages of actual bids which have been received by EIBRAPA
for similar buildings.

3.17 Vehicles and farm equipment costs take into account replacement
of older equipment as well as new equipment for the programs under this
proposal. Cost estimates reflect prices for vehicles and equipment
presently available in Brazil. Emphasis will be placed on purchase of
goods for which spare parts and maintenance would be readily available.

3.18 Office and laboratory furniture and equipment costs have been
based on quantities and prices of equipment submitted to EMBRAPA by
individual research centers. Again, special consideration would be
given to purchase of equipment from manufacturers who have representation
and service in Brazil and would be able to assist in installation and
operator training.

3.19 Library and documentation services costs have been estimated
at 6% of the total incremental operating cost. This amount is considered
adequate to purchase books, journals and miscellaneous library equipment
for the individual programs. Exceptions to this 6% guideline have been
identified in individual program annexes.

3.20 Research farm development includes land clearing, stump removal,
grubbing, and land preparation. Equipment purchased under this project
would be employed in farm development. Direct cost of labor and materials
would be paid for by EMBRAPA without request for reimbursement.

3.21 Technical assistance costs over an 8-year project life amount
to approximately 25% of the project base cost. Of the US$34.5 million
estimated cost of technical assistance, about US$15.5 million would be
used for 193 man years of consultants, both long- term and short-term.
Fellowships are estimated to cost about US$12.8 million. Long-term and
short-term fellowships total 1,379 man years.

3.22 Consultants are estimated to cost an average of US$80,000 per
man year. This includes salary, living allowances, travel and other
perquisites normally received by consultants on internationally financed
projects.

3.23 Fellowship costs are based on estimates from EMBRAPA, The
Rockefeller Foundation, International Agricultural Development Service,
and the International Institute for Education. An average cost per
man-year for fellowship training is estimated to be (a) outside Brazil,
US$13,000, (b) within Brazil, US$5,500 and (c) short-term US$7,000. See
Annex 22 Table 5 for numbers, phasing, and cost of fellowships.








3.24 Other assistance costs amount to an estimated US$6.2 million
or 5% of the project base cost. Other assistance includes an estimated
US$500,000 for architect and engineer services to prepare tender documents
and supervise construction of civil works, expenses for a team of experts
to participate in a mid-term project evaluation estimated to cost US$200,000,
and payment for costs involved in EMBRAPA-sponsored international conferences
which are estimated to run about US$1.0 million. Additionally, US$4.0
million have been included in the project allowing EMBRAPA to supplement
its own research with contracted research or research grants. Language
training, estimated to cost US$500,000, will be an important factor in
pre-fellowship preparedness.

3.25 Incremental operational costs amount to an estimated US$51.9
million or 37% of the project base cost. Included as a major part of
incremental operational costs are salaries and benefits for additional
staff which will be required to implement the project. Additional funds
to support incremental staff have been included as "Other Operational
Costs."

3.26 Salaries and wages for incremental staff are estimated to be
US$33.2 million. A summary of numbers of proposed incremental staff
follows:

(a) Senior Staff 150 persons
(b) Junior Staff 182 persons
(c) Research Support Staff 1158 persons
Total Incremental Staff 1490 persons

Assumptions used in determining average staff remunerations are outlined
in Annex 22.

3.27 Other operational costs for this project are estimated to be
US$18.7 million. This cost estimate represents approximately 30% of
first and second-year incremental salaries plus 40% of incremental
salaries for the remaining project years through year five. No incre-
mental operational costs or salaries have been included for project
years 6 through 8.-

3.28 Contingencies over the 8-year project life amount to US$59.8
million or about 43% of the project base cost.

3.29 Physical contingencies have been estimated at 15% of the cost
of civil works costs plus 10% of the total cost of vehicles, farm equipment,
office and laboratory furnishings and equipment. The estimate for
physical contingencies for the project amounts to US$5.1 million.




S These years have been added to the normal 5-year project life to
allow the fellowship program and other technical assistance to be
completed within the life of the project. Similar 8-year agri-
cultural research projects proposed for World Bank financing include
Indonesia and Thailand.




25



3.30 Price contingencies for this proposed project total approximately
US$54.7 million or 39% of the project base cost. Price contingencies
have been calculated by applying a factor for estimated inflation to the
phased sum of the project base cost plus physical contingencies. An
estimated annual inflation rate of 10% has been assumed and is compounded
over the 8-year project life.








IV. PROJECT IMPLEMENTATION


A. Organization and Responsibility


Organization

4.01 The project would become an integral part of EMBRAPA's research
and research support program, and thus an integral part of the National
Agricultural Research Program (PRONAPA). The Executive Directorate of
EMBRAPA has verified that the proposed programs in the project are in
full accord with the policies of the Ministry of Agriculture, and are
compatible with both the National Plan of Development (PND) and the
Basic Plan for Science and Technology Development (PBCT). While overall
responsibility for the project rests with EMBRAPA headquarters in Brasilia,
the respective units of EMBRAPA (e.g. national commodity-oriented centers,
regional resource centers or UEPAEs) will be delegated authority for
program coordination and implementation.

Project Responsibility

4.02 EMBRAPA would be the executing agent for the project. The
responsibility for the project in EMBRAPA would be essentially along the
lines as for Agricultural Research I Project, i.e., Head of the Department
of Science and Technology (DTC) would have prime responsibility for the
execution of the research project. He would be assisted by staff in his
department, and by other departments in EMBRAPA, including those for
Human Resources (DRH), Finance (DFN), Special Projects (DPE), and Diffusion
of Technology (DDT). The Technical and Administrative Advisory Office
(ATA) and the Advisory Office for International Cooperation will provide
support to DTC in project management. DTC will interact directly with
the coordinators of each of the research and research support programs.


B. Field Implementation and Research Methodology


4.03 The execution of research would be handled through maximum
delegation of authority and responsibility to the national program
leader/coordinator and to the participating stations. The national
program leader/coordinator for the various research programs would be
responsible for developing and integrating research efforts of the
multi-disciplinary teams. He also would serve as the principal in
facilitating cooperation between commodity programs, regional research
programs, state-level research units, and other collaborating institutions.
In the programming of activities at the research program level, the
national program leader/coordinator also interacts through planning and
review workshops with representatives of interested organizations such
as those responsible for extension, regional development, agricultural
credit, and inputs.








IV. PROJECT IMPLEMENTATION


A. Organization and Responsibility


Organization

4.01 The project would become an integral part of EMBRAPA's research
and research support program, and thus an integral part of the National
Agricultural Research Program (PRONAPA). The Executive Directorate of
EMBRAPA has verified that the proposed programs in the project are in
full accord with the policies of the Ministry of Agriculture, and are
compatible with both the National Plan of Development (PND) and the
Basic Plan for Science and Technology Development (PBCT). While overall
responsibility for the project rests with EMBRAPA headquarters in Brasilia,
the respective units of EMBRAPA (e.g. national commodity-oriented centers,
regional resource centers or UEPAEs) will be delegated authority for
program coordination and implementation.

Project Responsibility

4.02 EMBRAPA would be the executing agent for the project. The
responsibility for the project in EMBRAPA would be essentially along the
lines as for Agricultural Research I Project, i.e., Head of the Department
of Science and Technology (DTC) would have prime responsibility for the
execution of the research project. He would be assisted by staff in his
department, and by other departments in EMBRAPA, including those for
Human Resources (DRH), Finance (DFN), Special Projects (DPE), and Diffusion
of Technology (DDT). The Technical and Administrative Advisory Office
(ATA) and the Advisory Office for International Cooperation will provide
support to DTC in project management. DTC will interact directly with
the coordinators of each of the research and research support programs.


B. Field Implementation and Research Methodology


4.03 The execution of research would be handled through maximum
delegation of authority and responsibility to the national program
leader/coordinator and to the participating stations. The national
program leader/coordinator for the various research programs would be
responsible for developing and integrating research efforts of the
multi-disciplinary teams. He also would serve as the principal in
facilitating cooperation between commodity programs, regional research
programs, state-level research units, and other collaborating institutions.
In the programming of activities at the research program level, the
national program leader/coordinator also interacts through planning and
review workshops with representatives of interested organizations such
as those responsible for extension, regional development, agricultural
credit, and inputs.








IV. PROJECT IMPLEMENTATION


A. Organization and Responsibility


Organization

4.01 The project would become an integral part of EMBRAPA's research
and research support program, and thus an integral part of the National
Agricultural Research Program (PRONAPA). The Executive Directorate of
EMBRAPA has verified that the proposed programs in the project are in
full accord with the policies of the Ministry of Agriculture, and are
compatible with both the National Plan of Development (PND) and the
Basic Plan for Science and Technology Development (PBCT). While overall
responsibility for the project rests with EMBRAPA headquarters in Brasilia,
the respective units of EMBRAPA (e.g. national commodity-oriented centers,
regional resource centers or UEPAEs) will be delegated authority for
program coordination and implementation.

Project Responsibility

4.02 EMBRAPA would be the executing agent for the project. The
responsibility for the project in EMBRAPA would be essentially along the
lines as for Agricultural Research I Project, i.e., Head of the Department
of Science and Technology (DTC) would have prime responsibility for the
execution of the research project. He would be assisted by staff in his
department, and by other departments in EMBRAPA, including those for
Human Resources (DRH), Finance (DFN), Special Projects (DPE), and Diffusion
of Technology (DDT). The Technical and Administrative Advisory Office
(ATA) and the Advisory Office for International Cooperation will provide
support to DTC in project management. DTC will interact directly with
the coordinators of each of the research and research support programs.


B. Field Implementation and Research Methodology


4.03 The execution of research would be handled through maximum
delegation of authority and responsibility to the national program
leader/coordinator and to the participating stations. The national
program leader/coordinator for the various research programs would be
responsible for developing and integrating research efforts of the
multi-disciplinary teams. He also would serve as the principal in
facilitating cooperation between commodity programs, regional research
programs, state-level research units, and other collaborating institutions.
In the programming of activities at the research program level, the
national program leader/coordinator also interacts through planning and
review workshops with representatives of interested organizations such
as those responsible for extension, regional development, agricultural
credit, and inputs.








Regional Research Centers

4.04 The research on improvement of farming systems for the three
main agro-ecological regions would be coordinated by and conducted
primarily at (a) CPATSA, the center for semi-arid tropics, at Petrolina/
Juazeiro, in the states of Pernambuco and Bahia; (b) CPATU, the center
for the humid tropics, at Belem in Para state; and (c) CPAC, the center
for the Central-West, or Campos Cerrados region, at Planaltina, in the
Federal District. Work would be done, however, in close cooperation
with commodity-oriented centers and with other institutions with mutual
interests. The director of each regional station would have overall
administrative responsibility for the operation of the station, while
the associate director for research would serve as the program leader/
coordinator for the respective area farming systems research program.
He would function in the same manner as the national commodity research
program leaders in taking responsibility for planning, execution, coordina-
tion and evaluation and also for maintaining relations with EMBRAPA
headquarters and cooperating institutions.

4.05 The National Research Program for Forestry will be headquartered
at and coordinated by the Regional Unit for Forestry Research in the
Central-South at Colombo, Parana (URPFCS). Major components of the
research will be implemented at CPATSA, CPATU and CPAC.

National Commodity Centers

4.06 The national commodity-oriented research programs would be
conducted through a network of research centers, including a national
coordination center, satellite or sub-centers, and cooperating institutions.
The composition of the network would vary for different commodities.
Core integrated, multi-disciplinary research on the factors or problems
that limit production of the commodity generally would be undertaken
primarily by the team of scientists located at the coordination research
station or center. The director of each regional station would have
overall administrative responsibility for the operation of the station,
while the associate director for research would be responsible for
overall management and supervision of the research activities. He may
also serve as the national program leader/coordinator. The latter would
have principal responsibility and authority for planning, execution,
coordination and evaluation of the national program and would be the
principal liaison officer with the technical directorate staff of EMBRAPA,
with participating research team members, and with collaborating institutions.

Special Centers and Services

4.07 The National Program for Research on Food Technology, and the
National Basic Seed Program will be headquartered at and coordinated by
CTAA in Rio de Janeiro, and SPSB in Brasilia, respectively.

State Research Systems

4.08 The state research systems would participate in most of the
research programs, primarily as implementation units. In certain cases,
however, the UEPAEs would function as the coordinating center for a








national research program as well (e.g. coconuts and babacu). The state
research systems are comprised of state companies of agricultural research
(e.g. EPABA in Bahia), integrated research programs (e.g. in Sao Paulo
State), and state-level or territorial-level experiment stations operated
by EMBRAPA (e.g. the UEPAE at Teresina, Piaui, and the UEPAT at Porto
Velho, Rondonia).

EMBRAPA Headquarters

4.09 At least in the initial stages, two of the research programs
would be headquartered in EMBRAPA/Brasilia and coordinated by DTC.
These are the National Research Program for Agricultural Engineering,
and the National Research Program for Bioenergy. The National Research
Program for Animal Health would be headquartered in Brasilia at a central
laboratory to have responsibility for coordination of the program as
well as for a large part of the actual research and training. Proposed
centralized support for information and documentation would be handled
directly by EMBRAPA's Department of Information and Documentation (DID).

Contract Research

4.10 EMBRAPA would provide support for research on special problems
of priority concern in agricultural development to be conducted under
contract or agreement by organizations with special staff capabilities
or facilities. Specifically, contract research is contemplated in the
National Research Program for Food Technology. Also, in the National
Research Program for Bioenergy, contract research is anticipated in the
area of conversion of cellulose to liquid fuel. Matters requiring such
attention would be identified by EMBRAPA and studies would be planned
jointly by EMBRAPA and the institution or agencies which would actually
do the work.

Research Programming

4.11 EMBRAPA has recently adopted an improved system of programming
for agricultural research, referred to as the "circular model for pro-
gramming." It is characterized by a greater delegation of authority and
responsibility to lower echelons in EMBRAPA to the national commodity-
oriented centers, the regional centers, special centers or services, and
to the UEPAEs. This has been made possible by the increased field staff
capability resulting from experience and training -- both short-term and
degree-oriented. Further, the circular model of programming is charac-
terized by a greater emphasis on feedback at all levels in the EMBRAPA
system. This model is supplementing what was referred to as the "linear"
system which involved considerably more centralization of decision-making
at headquarters in Brasilia.

4.12. The new programming system of EMBRAPA operates at two general
levels at the level of national research programs (e.g. for a commodity,
farming systems for a region, or for a major problem such as bioenergy),
and at the level of research projects, the basic units of a research
program.








4.13 The.national research programs are established by the Executive
Directorate of EMBRAPA, reflecting national, regional or state development
policy, as well as the potential demand from farmers. These programs
are reviewed at least once every three years. Once national programs
are approved by the Executive Directorate, authority is delegated to the
EMBRAPA unit/institution for coordination and execution. The programs
executed or coordinated by EMBRAPA collectively constitute the national
agricultural research program, and are published annually in a report of
the same name -- PRONAPA. This publication is the responsibility of the
Technical and Administrative Office of EMBRAPA (ATA).

4.14 The research projects/experiments are proposed at the level of
the EMBRAPA research units, and are expected to be integral parts of
specific national research programs. The projects are discussed and
approved in annual workshops which are the responsibility of the decentral-
ized research units. The participants in these workshops include the
head of the research unit, the coordinator of the respective national
program, research workers of the research unit (as well as representatives
from collaborating EMBRAPA units, or state-level stations), and represen-
tatives from universities, extension services, regional development
projects, and the private sector. The results of the workshop are
published by the responsible EMBRAPA research unit as the Annual Plan of
Work.


C. Staff Training and Implementation


4.15 The project envisages increasing pre ent staff levels by 150
senior scientists- and 182 junior scientists- Disciplines of these
research staff members are identified in Volume II, individual program
annexes, Table 5. Administrative and research support staff will be
increased by 1158 persons. Incremental staff have been phased over the
first 5 years of the proposed 8 year project life.

4.16 EMBRAPA recognizes the importance of advanced degree training
toward career development of existing scientists as well as a method of
attracting new personnel into the organization.

4.17 The proposed project envisages a fellowship training program
totaling 1198 man-years, 660 man-years of study abroad and 538 man-years
of study in Brazilian universities. Volume II, Annex 22, Table 5,
indicates the phasing of these fellowships. In addition to long-
term fellowship training, about 181 man-years of short-term, non-degree
training, is anticipated as a part of the project.




/- PhD and MSc
2/
- BS or equivalent








4.18 Four types of long-term fellowship training are proposed:

-- PhD Abroad 112 persons 4 years each
PhD in Brazil 36 persons 3 years each
MSc Abroad 106 persons 2 years each
MSc in Brazil 197 persons 2 years each

These 451 fellowships will be filled by candidates from within existing
EMBRAPA staff, from staff and students in universities, and from the
private sector. Special emphasis will be placed on persons agreeing to
return from fellowship training and occupy long-term research positions
outside EMBRAPA headquarters.

4.19 Fellowship positions by disciplines cannot be identified at
this time. However, annual lists would be prepared and submitted for
approval which would outline disciplines as well as locations where the
candidates would work upon return to EMBRAPA.

4.20 Short-term fellowships will vary in duration, normally from
one to three months, for non-degree study. These fellowships would be
intended as a means of developing and improving human skills as well as
introducing new technology and methodology into the EMBRAPA research
system.


D. Monitoring and Evaluation


4.21 The new EMBRAPA system for planning and programming of research
was described under "B" of this chapter. This system also provides the
mechanism and means for monitoring and evaluating of EMBRAPA's research
projects and programs. This new "circular model" provides for a review
of each research program at least every three years. The review is
through a reunion or workshop which deals with a review of what has
taken place since the last workshop (or in the case of new programs,
since the inception of the program) and plans for the future. The
specific issues dealt with in a program workshop include:

analysis of the status of the commodity, regional farming
systems, or major problems for which a research program is
being proposed, or reviewed;

review of the current status of research relating to the
commodity, farming systems, or major problems;

assignment of priority to problems associated with the
commodity, farming system, or major problems;

basis of priority of problems, definition of research priorities
of both short- and long-term nature;

assignment of roles to the participating research units, and
the assurance that roles are compatible and coordinated;








determination of the estimated financial resources needed
for proposed research for the next two years; and

elimination or revision of the national research program
under consideration.

4.22 Participants in a program planning or review workshop include:
the head and sub-heads and program coordinator of the EMBRAPA unit
involved; representatives of the appropriate headquarters offices and
departments of EMBRAPA; representatives of other EMBRAPA, state, or
university research units that constitute part of the research network
for the particular program; representatives of EMBRATER; and representa-
tives of other groups that have a direct interest in the research program,
including cooperatives, agricultural credit organizations, and regional
development projects.

4.23 The programs included in Agricultural Research II Project
would be monitored and evaluated in accordance with EMBRAPA's new system
for programming of agricultural research. In addition, during the third
year of the project, a special evaluation would be made which would
include participation of international specialists in agricultural
research and research administration.








V. PRODUCTION AND TECHNOLOGY


General

5.01 In recent years the rate of growth in Brazil's food production
has been among the highest in the world. Production of all agricultural
commodities increased at an average compound rate of 3% between 1961-65
and 1971-75, while the production of food commodities alone grew at a
rate of nearly 5% per year. The rate of growth during the period 1970-79
has ranged from a low of -1.7% in 1978 (severe drouth) to a high of
11.4% in 1971.

5.02 While the rate of growth in agriculture has been remarkable,
it has resulted, for the most part, from increased area harvested rather
than improved yields. Average national yields of basic food crops,
including maize, rice, wheat, beans and cassava have improved little, if
any, during the period 1969-1979 (Vol II, Annex 1). Since base yields
of most of the principal crops are low, great potential exists for
increased productivity through use of improved technology.

5.03 Improved production technology has already had an impact on
certain crops, notably soybeans, but in considerable measure the basic
technology directly responsible was from the Northern temperate zone.
This is also true for some of the temperate climate vegetables. Through
the National Agricultural Research Program, particularly since establish-
ment of EMBRAPA, improved technology has been developed for a wide range
of farming systems and agricultural commodities. This technology can be
expected to have a growing effect on crop and livestock productivity
during the 1980's.

5.04 The proposed project, building on and adding to the Agricultural
Research I Project, focuses on three of Brazil's major agro-ecological
areas. The Central-West or Campos Cerrados, the Northeast or Semi-Arid
region, and the North or humid tropics. Collectively these regions
represent about 80% of Brazil's total land area and about 40% of the
total population. Relative to the South and Southeast regions, the more
northern three regions have been neglected in terms of agricultural
development. Attention has been directed to them in recent years,
however, because of their great agricultural potential and the need to
improve the lot of rural people.

5.05 The crop and livestock subsectors of the Cerrados, Semi-Arid
Tropics and Humid Tropics vary with the range in climate, soil, topography
and natural vegetation. The proposed project will not directly concern
all of the crops and domestic animals, but will include most of them
indirectly in the sense of giving considerable attention to improved
farming systems for the three regions. Further, the research will deal
directly with several basic food crops--rice, beans, fruits and vegetables.
Oil crops (coconut, African oil palm and babacu) also will receive
attention, particularly in context of use of the oil as a substitute for
petroleum-based fuel. Natural rubber both the Hevea of the humid








tropics and the manicoba from the semi-arid tropics, will be the subject
of the proposed research program. Livestock is attended, both in terms
of farming systems, and more specifically through research on the major
diseases limiting livestock production. The proposed Agricultural
Research II Project will involve a new national silviculture-agroforestry
program, as well as research programs concerned with food technology,
bioenergy and agricultural engineering. Finally, support is proposed to
strengthen EMBRAPA's national basic seed production service, as well as
its information and documentation service. The following paragraphs
will deal briefly with these groups of proposed research programs, in
terms of their importance and the general state of technology. Frequent
reference will be made to Volume II of the proposal which contains
detailed information about the 18 proposed programs.

Farming Systems

5.06 The proposed continuing support to farming systems research
will relate to more than 80% of the country's land mass, covering a wide
range of climate, soils, topography and crops. Increased production in
the three regions concerned -- Central-West, North and Northeast --must
contend with the general problems of infertile soils in the Cerrados,
deficient and erratic rainfall in the Northeast, and a region that is
now about 70% in forests (the North). Yet accelerated exploitation of
these areas for agricultural production is vital to meeting domestic
requirements and supporting export earnings of Brazil. Increased produc-
tion and productivity will depend, in large measure, on improved farming
systems.

5.07 A good start has been made on farming systems research through
EMBRAPA's three regional centers -- CPAC, CPATSA and CPATU -- enabled by
broad-based support made available under Agricultural Research I Project.
Building on what has been learned about existing farming systems in the
regions, and the initial advances in improvement of these systems,
accelerated progress in envisaged during the proposed project period.
(See Vol II, Annexes 3, 4, and 5.)

Basic Food Crops

5.08 Rice and beans will be directly involved under the proposed
programs through the CNPAF. These crops, plus other dietary staples
such as maize and cassava, will figure in the farming systems research.
While overall production of these basic food crops has been increasing,
there has been little change in the low average yields. Maize, beans
and cassava are grown primarily by smaller and poorer farmers, although
the situation is beginning to change in the case of maize. An increasing
proportion of Brazil's maize is being grown on larger-sized commercially-
oriented farms where modern techniques, including hybrid seeds, fertilizers
and mechanized harvesters, are employed. Technology for irrigated rice
is fairly good with average yields of about 3.7 tons/ha, however yields
under upland conditions is only about 1.2 tons/ha. The low level of
technology available with upland rice production, plus the variable
rainfall conditions, are largely responsible for the low yields and
erratic production. (See Vol II, Annexes 6 and 7.)








Fruits and Vegetables

5.09 The proposed program on fruit is limited to pineapples,
bananas and mangos both for increased availability domestically as
well as for export. In the case of vegetables, the focus is on the
North, a region neglected, in large measure, as far as improved vegetable
production technology is concerned. (See Vol II, Annexes 8 and 9.)

5.10 Brazil is the world's largest producer of bananas and the
second largest producer of pineapples. Only 3.5-4.0% of the bananas are
exported because of unsatisfactory varieties, quality and lack of standard-
ization. Pineapples are grown mostly for domestic consumption although
some processed fruit is exported. The mango presently is basically a
backyard crop. There is potential for greatly expanded production of
these fruits. Production and processing technology are inadequate and
will receive attention under the proposed program through the CNPMF.
The proposed food technology research program will cooperate closely
with the production research.

5.11 Vegetable consumption in Brazil, now about 50 kg/caput, has
been increasing at the rate of around 12%/year faster than the rate
of production. Consequently, imports have increased. Problems of
production and availability are particularly serious in the North, where
attention will be focused by the proposed research program.

Oil Crops

5.12 Under the proposed project attention will be given to three
oil-producing palms coconut, African oil palm and babacu. Production
of all three is largely in the North and Northeast, and, except for the
African oil palm, production is currently extractive in nature. There
is, however, a heightened national interest in vegetable oil production,
stemming in large part to the need to substitute for petroleum-based
fuels. The African oil palm and babacu are considered to be prime
candidates for vegetable oil production, especially in the Amazon basin.
African oil palm yields, largely from semi-wild populations, are 10-20%
of yields normally expected for this crop. Potentials are considered
large for expanded production of the three oil crops and implications
for increased employment correspondingly great. (See Vol II, Annexes
10, 11, and 12.)

Rubber

5.13 It is estimated world demand for natural rubber will reach 6
million tons by 1998, up from the current level of 3.5 million tons. It
is projected that some 500,000-800,000 tons of this should come from
Latin America largely from Brazil. In 1978 Brazil produced 23,708
tons of natural rubber, not enough to meet domestic requirements. The
potential for increased production of natural rubber from Hevea is
great; the Amazon basin is the center of region. There are problems,
however, notably South American leaf blight. It is believed this problem
can be mitigated and there will be a strong shift toward commercial
plantations with improved management. Brazil plans to plant 120,000 ha
within the next 5 years. The CNPSe at Manaus is the focal point for a
coordinated rubber research program. (See Vol II, Annex 13.)








Forestry

5.14 For several years cultivated land has been expanding at the
rate of about 3.9% per year. Correspondingly the forested area has been
shrinking, particularly in the South and Southeast. The area in forests
in 1958 was 64.7% of the total land area; in 1972 the area had dropped
to 58.5% of the total. The proposed research program will address the
forestry problem through two main avenues agroforestry and use of
marginal lands for forests. Little work has been done in Brazil on
agroforestry. There is some good work in the Cerrados on reforestation
of marginal lands. The proposed research program, to be centered at and
coordinated by URPFCS, will have important regional components: the
three centers of EMBRAPA- CPATU, CPATSA and CPAC. (See Vol II, Annex
14.)

Improved Seed

5.15 Improved seed is a critical input to accelerated agricultural
development. EMBRAPA has two important roles in the national seed
industry -- its scientists develop new varieties, and it has a major
responsibility for production of basic seeds, through the SPSB. SPSB
has 10 dispersed units for production, processing, storage and distribu-
tion of basic seeds. Under the proposed program, SPSB will give particular
attention to the neglected needs of the North and Northeast, and will
include additional important crops in its program. SPSB is the major
supplier of basic seed in the country and meets requests of both public
and private sector producers of commercial seed. (See Vol II, Annex
15.)

Livestock

5.16 Beef cattle production in Brazil is largely based on extensive
grazing operations under a low level of technology. The average off-take
of animals is 12% in contrast to 42% in the U.S., 39% in New Zealand,
31% in Argentina and 19% in Uruguay. While many factors are responsible
for the low level of productivity, diseases are singled out for attention
under the proposed Agricultural Research II Project. Research on animal
production receives attention through several of EMBRAPA's centers --
CNPGC, CNPGL, CNPSA, and UEPAE/Bage. While encouraging results have
been obtained in control'of animal diseases, research efforts need to be
coordinated and strengthened. This will be done through a national
animal health research program centered at Brasilia. (See Vol II, Annex
19.)

Food Technology

5.17 Increased food production should be accompanied by improved
technology for post harvest handling and storage, preparation', processing
and utilization. Food technology is important for domestic needs and
increased export. The South and Southeast are advanced in food technology,
but relatively little progress has been made in the North, Northeast,
and Central West. The proposed research program is oriented to redress
this situation. The program will be centered at CTAA with links to both
public and private sector organizations concerned with food production
and processing. (See Vol II, Annex 17.)








Bioenergy

5.18 Shortage and rising costs of petroleum have prompted Brazil to
consider production of alternative energy sources from renewable resources.
Production of ethanol from sugarcane, cassava and sweet sorghum is a
major industry. It is estimated that 200,000 vehicles to run on alcohol
will be manufactured in 1980. There is corresponding interest in use of
vegetable oils (e.g. from African oil palm and babacu) to substitute for
diesel fuel. Brazil is well-endowed for production of biomass for
liquid gas fuels. EMBRAPA is proposing a bioenergy research program to
provide technical support for Brazil's effort to become more energy
self-sufficient. Emphasis will be given to production of biomass, and
to development of energy sources for use in rural areas. The coordinated
research program will be headquartered in Brasilia. (See Vol II, Annex
18.)

Mechanization

5.19 Mechanization is a factor in the modernization of agriculture.
It often accompanies more intensive use of land, and is associated with
situations where manpower is limiting. In recent years land under
cultivation has been increasing at a rate of about 3.9% per year, while
population has been increasing at about 2.8%. This, coupled with a
marked and consistent trend of population shift from rural to urban
areas, is affecting manpower availability for agriculture in a number of
areas. Thus, there is growing interest in mechanization of agricultural
production and processing operations.

5.20 Traditionally, agricultural engineering has been neglected in
Brazil as an important profession for support of research and development
efforts for accelerated agricultural development. This situation is
being improved, and now degrees are being granted in agricultural engi-
neering but still in a limited number of institutions. Thus trained
manpower in this profession is scarce. Correspondingly mechanization in
agricultural production in particular has received inadequate attention.

5.21 The proposed agricultural engineering program will be concerned
with the changing fuel situation in energy as related to agriculture,
and will include attention to draft animals. (See Vol II, Annex 16.)








VI. DEMAND AND MARKET PROSPECTS


General

6.01 Brazil is generally self-sufficient in its major food crops
and is the world's second largest exporter of agricultural commodities.
Government concern for self-sufficiency and desire to increase export
for foreign exchange are reflected in high average annual rates of
growth in agriculture. Increased domestic needs are the result of a
population growth of about 2.8% per year coupled with increased purchasing
power on the part of significant portions of the society. In addition,
the petroleum problem has further encouraged the government to export
agricultural commodities to offset sharply rising costs for imported
petroleum. At the same time the government is encouraging substitution
of fuels from renewable resources for petroleum e.g., alcohol and vegetable
oils.

6.02 While exports reached US$15.2 billion in 1979, with agricultural
products estimated to have accounted for 46%, it was necessary to import
in the same year about US$1.6 billion in grains to offset the disappointing
harvest of wheat, maize, and rice. The government is pushing for exports
of agricultural crops worth US$7.5 billion in 1980 -- based largely on
coffee, cocoa, soybeans and sugar.

6.03 The Government actively stimulates agriculture by a policy
that gives this sector top priority. This is realized by minimum prices
at a level that stimulate production, guaranteed production loans, and
export incentives. Thus, in general, the demand and market prospects
look encouraging in the 1980s for most of Brazil's major agricultural
commodities.

S6.04 The following paragraphs provide additional information for
several commodities, all of which are involved (directly, or through
farming systems) in the Agricultural Research II Project.

Food and Feed Grains

6.05 Consumption of wheat in 1979 continued to grow at a strong
rate, totaling around 6.7 million tons. Of this amount, 3.8 million
tons were imported. The government has started a campaign to attract
experienced wheat farmers from southern Brazil to produce the crop in
the Central-West region of the'country.

6.06 Rice consumption is estimated at 8.6 million tons in 1979, up
about 3.6% from the previous year. In some years production does not
meet domestic demand and imports are necessary. The government is
attempting to attain self-sufficiency in rice, despite problems associated
with variable weather conditions in the upland growing areas, which
account for about 70% of total production. A key goal of the policy is
to reduce Brazil's heavy dependence on upland rice through expanding
irrigated rice production into nontraditional areas.








6.07 In 1979 maize production was 16.5 million tons with a utilization
estimated at 17.6 million tons. Feed use accounted for 84%, reflecting
the continued expansion of the poultry and swine industries. Maize
usage by the now booming mixed-feed industry is projected to reach 8.0
million tons in 1980, or 51% of total food use. Maize exports in recent
years have ranged between 1-2 million tons, and are expected to trend
upward.

6.08 Brazil, the world's largest producer of dry beans, harvested
2.28 million tons in 1979. In general, production and demand are balanced,
but because of climatic variations from season to season and year to
year, periodic deficits occur which necessitate imports. The government
is encouraging increased production through higher support prices and
financing. These incentive programs have been especially aimed at small
producers who account for 70% of this production.

Oil Crops

6.09 The importance accorded by Brazil to lessen dependence on
imported petroleum is expected to result in escalating demand for vegetable
oils to replace diesel fuel. Important oil crops include the Africa oil
palm and the babacu. The Amazon basin offers a potential for almost
unlimited production of these two crops, which to date have received
little attention. It is also expected that the strong emphasis on
energy from renewable resources will stimulate production of sugarcane,
sweet sorghum, cassava, and possibly sweet potatoes, for production of
fuel alcohol. PROALCOOL has approved 11 cassava distilleries with a
production capacity of 345 million liters per year. These projects
should be in commercial operation by 1981.

Fruits and Vegetables

6.10 The cost of imported fresh and processed vegetables (and
vegetable seeds) has increased from about US$39.9 million in 1973 to
approximately US$92.3 million in 1977 (CACEX, N.A./A.T.E.). There has
been a large increase in consumption of vegetables over the past decade.
Vegetable production has been increasing at an annual rate of slightly
over-12%, but consumption has exceeded production. The current average
per caput consumption is 50 kg. Many vegetables have to be imported
into the urban centers of the North.

6.11 Brazil is the world's largest producer of bananas (some 4
million tons) but only 3.5-4.0% are exported. Most of the production is
under low levels of technology. A large potential exists for increased
production. Most pineapples are consumed domestically. In 1978 exports
totalled 12,022 tons of fresh fruit valued at US$3.4 million.

Rubber

6.12 In 1978 Brazil produced 23,708 tons of natural rubber and had
to import to meet domestic requirements. Because of the world petroleum
situation, demand has increased for natural rubber, and the projected
need, worldwide, for 1998 is 6 million tons. This represents a 65.4%
increase over the current production level of about 3.5 million tons.




39



To meet the 1998 goal it is planned that Latin America will produce
500,000-800,000 tons per year by 1998. Most of this should come from
Brazil. In moving toward expanded production, Brazil plans to plant
120,000 ha to rubber over the next 5 years.








VII. BENEFITS AND JUSTIFICATION


A. Investment in Agricultural Research


7.01 The high economic payoff to effectively organized and implemented
agricultural research programs is well-demonstrated. In Latin America
during the late 1960s the economic rates of return for research on
maize, sugarcane, wheat, and cotton are reported to have ranged between
35 and 90%. A study of the Green Revolution in India gave a rate of
return to research of 72%. Estimated economic rates of return for
developing countries average 42% for applied research and 60% for scien-
tific research related to agriculture.

7.02 While it can be argued that economic efficiency is a valid
criterion for a society to use to guide investment of its scarce resources
in research, it is not considered a universally sufficient yardstick.
Specific concern for welfare of the poorest regions and groups may
assume equal importance. Energy use also is receiving increasing attention.
The influence of new technologies on income distribution among producers
within a given region, between landholders and laborers, and between
producers and consumers are being studied intensively. About the only
conclusion that can be made in this area is that the impact of new
agricultural technologies on income distribution is a complex matter
about which broad generalizations are difficult to make and, if made,
they shed little light. This points to the need to give serious considera-
tion, in designing research programs, to the functions they should carry
out and against which they should be evaluated.

7.03 No attempt has been made to quantify the economic rate of
return on the proposed project because of:

inherent uncertainties regarding the timing and value of
research findings, and the timing and extent of adoption of
research findings by farmers;

difficulties in dividing potential benefits between research
and complementary investments (e.g., irrigation, extension,
training);

the problem of assessing the value of negative research
results, which add to the pool of knowledge and frequently
benefit subsequent research efforts; and

the fact that the proposed project, especially in its manpower
development, and institution-building aspects, would only be
part of the larger research effort without analytically
separable benefits.

7.04 While economic rate of return on investment in agricultural
research projects is difficult, at best, there are useful ex ante indicators.
Common characteristics of successful research projects are:








VII. BENEFITS AND JUSTIFICATION


A. Investment in Agricultural Research


7.01 The high economic payoff to effectively organized and implemented
agricultural research programs is well-demonstrated. In Latin America
during the late 1960s the economic rates of return for research on
maize, sugarcane, wheat, and cotton are reported to have ranged between
35 and 90%. A study of the Green Revolution in India gave a rate of
return to research of 72%. Estimated economic rates of return for
developing countries average 42% for applied research and 60% for scien-
tific research related to agriculture.

7.02 While it can be argued that economic efficiency is a valid
criterion for a society to use to guide investment of its scarce resources
in research, it is not considered a universally sufficient yardstick.
Specific concern for welfare of the poorest regions and groups may
assume equal importance. Energy use also is receiving increasing attention.
The influence of new technologies on income distribution among producers
within a given region, between landholders and laborers, and between
producers and consumers are being studied intensively. About the only
conclusion that can be made in this area is that the impact of new
agricultural technologies on income distribution is a complex matter
about which broad generalizations are difficult to make and, if made,
they shed little light. This points to the need to give serious considera-
tion, in designing research programs, to the functions they should carry
out and against which they should be evaluated.

7.03 No attempt has been made to quantify the economic rate of
return on the proposed project because of:

inherent uncertainties regarding the timing and value of
research findings, and the timing and extent of adoption of
research findings by farmers;

difficulties in dividing potential benefits between research
and complementary investments (e.g., irrigation, extension,
training);

the problem of assessing the value of negative research
results, which add to the pool of knowledge and frequently
benefit subsequent research efforts; and

the fact that the proposed project, especially in its manpower
development, and institution-building aspects, would only be
part of the larger research effort without analytically
separable benefits.

7.04 While economic rate of return on investment in agricultural
research projects is difficult, at best, there are useful ex ante indicators.
Common characteristics of successful research projects are:









a program oriented to major development goals;

researchers participating with planners in identifying the
desired changes (the search for new technology and for
improvements in current technology should begin as soon as
desired directions for change are clear);

competent and stable leadership;

a well-trained staff at all levels (training is continuous;
personal and professional incentives are provided);

multidisciplinary teams addressing clearly identified problems;

research activities closely integrated with activities of
extension services, schools of agriculture, planning agencies,
ministries other than agriculture, and the private sector;

access to international resources;

clearly written and promptly reported research results; and

farmers as active participants in the research process.

The ongoing and planned research programs of EMBRAPA meet the criteria
in large measure. Thus, there is reason to assume a good return on
investment to strengthen research as proposed under Agricultural Research
II Project.


B. Beneficiaries and Target Population Groups


7.05 Agricultural Research II Project focuses largely on the northern
part of Brazil -- the North, Northeast, and Central West regions, as
does its predessor. These three regions comprise about 82% of Brazil's
total land area, 40% of the population (1977), and 53% of the farm
workers (1970). About half of the total population in each region is
rural. In 1970 the North and Northeast, with 47% of the country's farm
labor force, produced only 21% of the national agricultural output. The
agricultural production technology gap between the North and the South
is acute. Yet, the North holds great promise for expanded agricultural
development. The Northeast, Amazonia, and Campos Cerrados represent a
significant part of the world's remaining potential for increased food
production.

7.06 The socio-economic situation of most of the farmers in the
project area is precarious. In the three agro-ecological areas of the
project, about 65% of the farm holdings, or some 1.6 million farms, are
of less than 10 ha. The farm population of more than 8 million people
on these farms lives in relative poverty.








7.07 All commodities included in the project are present or potential
significant sources of income for a great many farmers both large and
small. Additionally, rice, beans, vegetables, and fruits are important
elements of the staple diet of the poorest segment of the population.
Accelerated production and local processing of African oil palm, babacu
and rubber can generate much additional employment, especially in the
North. The food technology and bioenergy research programs can serve as
accelerators to food production and biomass production for gas, liquid
and solid fuels.

7.08 Agricultural growth will increase smallholder incomes, food
availability, and foreign exchange earnings, which are all critically
important to economic development and welfare in Brazil, and which are
strongly supported by the government.


C. Social Benefits

(to be completed later)



D. Project Risks


7.09 Strong government commitment to self-sufficiency in food, to
increased export of agricultural products, and to greater reliance on
substitute fuels from biomass to replace those from petroleum, augur
well for success of Agricultural Research II Project. Nevertheless, as
with all research projects, there is considerable uncertainty about what
the research findings and hence the benefits would be.

7.10 Linkages between research and extension services, not fully
effective in many countries, are critical to the success of Agricultural
Research II Project. Experience gained through EMBRAPA and EMBRATER
interaction during the next few years, provides a good base for further
strengthening of relationships.

7.11 Project implementation is contingent on realization of a
broad-based recruitment and staff training program. It may be difficult
in some areas, e.g., agricultural engineering, bioenergy and food process-
ing, to obtain qualified staff during the early stages. Use of consultants
can, of course, help mitigate this situation.

7.12 Some risks have been identified that are specific to certain
programs, and are described in Volume II (Annexes).


E. Environmental Effects


7.13 The fragility of the regional eco-systems of humid tropics of
the North, of the semi-arid tropics of the Northeast, and of the cerrados
of the Central West, is recognized in the farming systems research








7.07 All commodities included in the project are present or potential
significant sources of income for a great many farmers both large and
small. Additionally, rice, beans, vegetables, and fruits are important
elements of the staple diet of the poorest segment of the population.
Accelerated production and local processing of African oil palm, babacu
and rubber can generate much additional employment, especially in the
North. The food technology and bioenergy research programs can serve as
accelerators to food production and biomass production for gas, liquid
and solid fuels.

7.08 Agricultural growth will increase smallholder incomes, food
availability, and foreign exchange earnings, which are all critically
important to economic development and welfare in Brazil, and which are
strongly supported by the government.


C. Social Benefits

(to be completed later)



D. Project Risks


7.09 Strong government commitment to self-sufficiency in food, to
increased export of agricultural products, and to greater reliance on
substitute fuels from biomass to replace those from petroleum, augur
well for success of Agricultural Research II Project. Nevertheless, as
with all research projects, there is considerable uncertainty about what
the research findings and hence the benefits would be.

7.10 Linkages between research and extension services, not fully
effective in many countries, are critical to the success of Agricultural
Research II Project. Experience gained through EMBRAPA and EMBRATER
interaction during the next few years, provides a good base for further
strengthening of relationships.

7.11 Project implementation is contingent on realization of a
broad-based recruitment and staff training program. It may be difficult
in some areas, e.g., agricultural engineering, bioenergy and food process-
ing, to obtain qualified staff during the early stages. Use of consultants
can, of course, help mitigate this situation.

7.12 Some risks have been identified that are specific to certain
programs, and are described in Volume II (Annexes).


E. Environmental Effects


7.13 The fragility of the regional eco-systems of humid tropics of
the North, of the semi-arid tropics of the Northeast, and of the cerrados
of the Central West, is recognized in the farming systems research








7.07 All commodities included in the project are present or potential
significant sources of income for a great many farmers both large and
small. Additionally, rice, beans, vegetables, and fruits are important
elements of the staple diet of the poorest segment of the population.
Accelerated production and local processing of African oil palm, babacu
and rubber can generate much additional employment, especially in the
North. The food technology and bioenergy research programs can serve as
accelerators to food production and biomass production for gas, liquid
and solid fuels.

7.08 Agricultural growth will increase smallholder incomes, food
availability, and foreign exchange earnings, which are all critically
important to economic development and welfare in Brazil, and which are
strongly supported by the government.


C. Social Benefits

(to be completed later)



D. Project Risks


7.09 Strong government commitment to self-sufficiency in food, to
increased export of agricultural products, and to greater reliance on
substitute fuels from biomass to replace those from petroleum, augur
well for success of Agricultural Research II Project. Nevertheless, as
with all research projects, there is considerable uncertainty about what
the research findings and hence the benefits would be.

7.10 Linkages between research and extension services, not fully
effective in many countries, are critical to the success of Agricultural
Research II Project. Experience gained through EMBRAPA and EMBRATER
interaction during the next few years, provides a good base for further
strengthening of relationships.

7.11 Project implementation is contingent on realization of a
broad-based recruitment and staff training program. It may be difficult
in some areas, e.g., agricultural engineering, bioenergy and food process-
ing, to obtain qualified staff during the early stages. Use of consultants
can, of course, help mitigate this situation.

7.12 Some risks have been identified that are specific to certain
programs, and are described in Volume II (Annexes).


E. Environmental Effects


7.13 The fragility of the regional eco-systems of humid tropics of
the North, of the semi-arid tropics of the Northeast, and of the cerrados
of the Central West, is recognized in the farming systems research




43



programs. In fact, for improved farming systems in these regions to be
successful on a sustained basis, care must be given to properly manage
the soil, water, and natural vegetation resources. Research on specific
commodities, as reflected in several of the proposed programs, will be
in a farming systems context. The forestry program, in particular, will
be concerned with a melding of forestry and agriculture and with reforesta-
tion or afforestation of marginal lands. Emphasis will be given to
genetic means to increase crop resistance to insect pests and diseases,
thereby lessening the need to use plant protection chemicals.




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