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There are a few things that would make Brazil a lot more stable economically (and even socially and politically) if we achieved self-sufficiency: Fossil fuels:
by marcodiego 3y ago
There are a few things that would make Brazil a lot more stable economically (and even socially and politically) if we achieved self-sufficiency:
Fossil fuels: Currently, Brazil is self-sufficient in oil, but we export petrol to buy back refined fuels (gasoline and diesel). If we were self-sufficient in fossil fuels we would be much more immune to inflation every time OPEC decides to reduce oil output.
Wheat: We are the top of the world exporting foods. We produce 6x our current need. Nevertheless, we still need imported wheat. Ukraine war and dollar variations literary affect our bread.
Fertilizers: The largest world food producer needs imported fertilizers. The irony: our main supplier is Russia. This basically prevents Brazil taking any side in the conflict and affects our (and our buyers) food prices as much as wheat.
Achieving self-sufficiency in these three areas would be like a second independence for us (first was when we got free from Portugal).
- lostlogin 3y ago> Fertilizers: The largest world food producer needs imported fertilizers. The irony: our main supplier is Russia. This basically prevents Brazil taking any side in the conflict and affects our (and our buyers) food prices as much as wheat. No, it means you can’t take a position without paying a cost. A lot of countries used to depend on Russia for various things, and they have paid a price to change this.
- mkoubaa 3y agoIf Brazil exports less food it isn't Brazil alone that would pay the price
- roqi 3y ago> If Brazil exports less food it isn't Brazil alone that would pay the price Ukraine is/was the world's bread basket. Supporting Russia jeopardizes the world's access to food. Brazil's actions don't exist in a vacuum.
- irusensei 3y agoBrazil is not Europe. It’s not going to be some minor inconvenience like having people to take cold showers and virtual signal on the internet. There will be famine and the poorest people will die.
- DoingIsLearning 3y agoIndeed, Sri Lanka's latest crisis is a heavy example of fertilizer disruption without long term planning.
- ben_w 3y agoEurope got lucky with the cold, but for (many) other aspects has been very effective at diversifying very quickly away from Russian supply. Sure, even the poorest countries in the EU are significantly richer than Brazil, but it's not like we didn't get significant food price inflation either. https://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)_per_capita https://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)...
- cainxinth 3y agoLucky? More like expected. The ten hottest years ever recorded all occurred in the last ten years. I’m gonna go out on a limb and predict next winter will also be unseasonably mild in Europe… and everywhere else.
- ben_w 3y agoIt was still warmer than expected. Look at how prices shot up in advance, before declining when it became clear quite how slowly the stockpiled resources would be consumed.
- throwaway290 3y agoIt's not about not buying stuff at all. Just buy it from different sources. Morocco for example.
- refulgentis 3y ago
- hulitu 3y ago> A lot of countries used to depend on Russia for various things, and they have paid a price to change this. And now they depend on US for the same things paying a much bigger price. Some countries never learn.
- roqi 3y ago> And now they depend on US for the same things paying a much bigger price. What? Germany is now reporting record drops in it's energy prices. https://www.cleanenergywire.org/news/energy-costs-german-households-drop-nearly-one-third-peak-energy-crisis https://www.cleanenergywire.org/news/energy-costs-german-hou...
- jddj 3y ago"However, energy prices remain well above pre-crisis levels, he added."
- randomdata 3y ago> Nevertheless, we still need imported wheat. Ukraine war and dollar variations literary affect our bread. This would happen imports or not. So long as wheat exports are allowed, the local price will settle on the world price as the product is able to flow to the highest bidder. An event like the Ukraine war will impact someone and that will drive the world price up.
- SamBam 3y agoOnly under a perfectly free market system. A great many countries have export controls in place specifically for wheat and other vital commodities. States can also set price ceilings and floors. The US, for instance, passed the temporary Wheat Price Guarantee Act during WWI.
- Georgelemental 3y agoAlso, even a perfectly free market has shipping costs.
- leonidasv 3y agoBrazil government runs a company called Conab that acts as a "buffer stock" for grains. It buys, stores and sells grains in large quantities in a continuos fashion, so the government can soften market fluctuations for those commodities over time.
- PoignardAzur 3y agoThat's fascinating. I've wondered for a while whether governments did that. Seems like a common sense precaution for preserving your country's food security.
- vitorgrs 3y agoIn the latest 5-6 years the stock was basically zero-d. And the previous government even wanted to close CONAB. Now I believe they will return to stock commodity and stuff again, but there's a lot of pressure from agrobusiness to not stock again. One of reason why food inflation in Brazil rise in the latest years is exactly because of CONAB stopped stocking it. Even milk and peanut they stocked before.
- marcosdumay 3y agoHum... Nope, Brazil is not really self-sufficient in oil. It was for a while, but the production did not keep up with the domestic consumption. Anyway, Brazil exports its oil and imports some slightly more expensive one because the existing refineries weren't built to process the relatively recently discovered kind of it that consists on most of the production. And there is little sense in upgrading them. About wheat, yeah, nobody ever place any priority on being self-sustaining. That's because it's not really important. Brazil has a couple of neighbors that produce enough wheat for supplying it, and need quite a bunch of stuff Brazil produces. The only reason anybody is going for self-sustainance now is because it's profitable, and things will change once it's not. On fertilizers, well, Brazil can not produce enough of the material for the fertilizers it imports.
- siftrics 3y agoThe commenter is not claiming Brazil is already self-sufficient in those three things.
- KingOfCoders 3y ago"Currently, Brazil is self-sufficient in oil"
- nonethewiser 3y agoWhat you said is pretty much in agreement with what he said.
- jasmer 3y ago"would make Brazil a lot more stable economically (and even socially and politically) " It's the other way around. Brazil and Argentina especially should be rich, what's lacking is coherent social organization from top to bottom. Obviously it matters more at the top, but it has to be borne by regular people as well. Same could be said of other Central/South American nations, but geographic factors and natural resources do give a material advantage that can be leveraged into a lot. Consider that Canada, unlike most other so called 'advanced nations' - does not actually have lot of advanced industry. Research, yes, but 'applied' - no. And yet, because it has a 'free export card' with natural resources, it can import the equipment and materials necessary to support the rest of the regular domestic economy, which benefits from ultra boring politics, 'functional' bureaucracy, low levels of corruption. Innovations can only be leveraged by organizations that have the coherent ability to make use if them. The 'low hanging fruit' in Brazil is governance, though I hope this Wheat helps.
- foobarian 3y agoWhy don't the states there organize into a southern United States? It feels silly to talk about self-sufficiency and all when the analog at country level is the USA states. Nobody would expect e.g. Rhode Island to feed itself, but thankfully there is the Midwest. Maybe Bolivar's dream could come true one day.
- shagie 3y agoThe United States grew (colonized, captured, appropriated - feel free to chose the verb that most agrees with your view - it doesn't matter too much) into relatively uninhabited land from a starting point with a relatively uniform culture and ideals. As areas got to a large enough population that they could become a state, they were added to the union. South American is already mature. The countries there have different political situations and relationships. Trying to bring them into one federal republic is a non-starter -- it ain't gonna happen. A better model would be the EU where you have mature countries removing trade barriers between them, allowing free immigration, and a single currency. This was anchored by a few large countries that had relatively low corruption, peaceful relations and strong economies. South America... doesn't quite have a strong set of low corruption and strong economies. There are regular coups and a number of ongoing civil wars that would make trying even for a loose coalition of countries in South America difficult.
- wolverine876 3y ago> Achieving self-sufficiency in these three areas would be like a second independence for us (first was when we got free from Portugal). Every country in the world is dependent on trade, which is saves a lot of money over self-sufficiency. North Korea is the only country that tries self-sufficiency. If it costs you $100/bushel to produce wheat and you can buy it for $60/bushel (I'm fabricating numbers), why produce it?
- bee_rider 3y agoIt is nice to be self-sufficient on survival staples like grains if that is an option. If your competitors are driving a hard bargain and the downside is that you don’t get video game consoles, it isn’t the end of the world, you can call their bluff. If the downside is starvation, it is a bit tougher.
- wolverine876 3y agoWhen has that happened - that a country experienced starvation because grain was withheld? Especially a country the size of Brazil?
- UncleEntity 3y agoAsk the Soviets. Though they were able to find alternative foreign sources to make up the difference and redevelop domestic production.
- kabouseng 3y agoEast Germany after WW2
- tirrellp 3y agoBecause 'Geopolitical Risk' is a thing. Its nice when you can buy $60/bushel wheat. Its not so nice when your dealer cuts you off. The extra $40/bushel you pay to produce in-house, thats your insurance policy against having your supplies cut off. In a world where geopolitical lines are shifting, it's a matter of national security and optionality to have your own food production capacity. Risk management.
- thrwawy74 3y agoI found this compelling but I'm still seeing how objective it is as we carry out this timeline: https://www.youtube.com/watch?v=Wi_nFz1CJSI https://www.youtube.com/watch?v=Wi_nFz1CJSI
- gexla 3y ago> Wheat: We are the top of the world exporting foods. We produce 6x our current need. What? Source? Just some rough Google search results seem to consistently show China as #1 in production and the US being #1 in exports (and in the top 3 for production.) The first result I found showed Brazil as #4. Maybe you're ultimately correct, but you should show a source when making those claims (I'm not trying to make a claim.)
- xeromal 3y agoIt could just mean they're one of the top of the world. Probably just a slip up. I wouldn't read into it too much. lol
- mkl 3y agoNo, they confirm that interpretation in the next paragraph: "The largest world food producer".
- gexla 3y agoThe trouble is, when you're making claims which are obviously wrong, then it throws the entire argument into question. If you're getting easy things wrong, then I'm not going to bother with the rest. It's like spelling and grammar issues on your cover letter. You might be a great hire, but come on, at least deal with the easy stuff.
- safety1st 3y agoIt's perfectly possible to evaluate the other claims in the comment independently from this one. The behavior you're advocating (refusing to consider the rest of the comment because of one error) not only makes you look like a dick, it also makes you worse informed. Bad take dude
- gexla 3y agoMaybe you're giving it a pass because it's a quick to read comment. If this is an essay or a book, I'm absolutely going to consider skipping it at the first major error. This is especially the case if the book is heavy on building a case which would need to be backed by facts (sources.) If the author isn't willing to include sources to back up claims which are passed as fact, then I'm not going to do the work myself. It's difficult enough to open the time to read the thing in the first place. And I would be doing myself a disfavor by believing any of it.
- senectus1 3y ago>Fertilizers Watch this space.. Green Ammonia is going to be a big new development for Brazil soon... or at least there are a couple of green hydrogen companies that trying very hard to get that up and running in Brazil right now.
- namaria 3y agoThat's interesting but the real bottleneck is Phosphate. You can't manufacture that...
- deleted 3y ago[deleted]
- wodenokoto 3y agoDoes Brazil send crude oil to opec for refining? I’d thought refineries would be hungry for oil when opec decreases production and therefore be a net benefit for oil producers outside opec.
- londons_explore 3y agoIt might be a net benefit, but distributing that wealth from oil producers to oil users within Brazil isn't easy. And when oil users see the price of their oil going up, that's what triggers inflation.
- wodenokoto 3y agoBut would that change if it was refined within the borders?
- londons_explore 3y agoOnly if you also closed the borders, so that the internal and external prices were insulated from eachother.
- cmarschner 3y agoWell, Brazil needs to stop producing oil within at most a generation. Or pay for it.
- matheusmoreira 3y agoWhy would we do that?
- rs_rs_rs_rs_rs 3y agoBecause the american liberal that knows what's best for everyone told you that, what was not clear?
- was_a_dev 3y agoThe user isn't even American. Nor is it clear that they are "liberal"
- huuhee3 3y agoClimate change maybe?
- matheusmoreira 3y agoWe're not yet rich enough to be able to afford such virtue. Give us some time.
- was_a_dev 3y agoAre renewables economically viable? I don't expect any nation that isn't "rich enough" to go green, but the trends of it becoming cheaper means it will become the cheapest means. Are we there yet? My assumption was the political climate of Brazil was primarily pushing oil dependence
- matheusmoreira 3y ago
- matheusmoreira 3y ago> This basically prevents Brazil taking any side in the conflict and affects our (and our buyers) food prices as much as wheat. Not at all. President Lula sided with China and Russia already. Dude loves communists. He even had Venezuelan dictator Maduro over for lunch.
- worstestes 3y agoAh so Russia is a communist country?
- matheusmoreira 3y agoIt was once. Lula literally wants to turn South America into a southern Soviet Union. Not even kidding.
- anthk 3y agoThat's bullshit, sorry.
- matheusmoreira 3y agoSigh. Is it news to you that this guy's a socialist? He literally called himself "a refined socialist" last year before the elections. Why do I have to keep reminding people of this fact? He literally founded a forum for south american communists to gather and discuss how to install this cancer everywhere. There's fucking decades old videos of him talking about installing socialism in Brazil. It's seriously tiresome having to say this stuff over and over every single time.
- anthk 3y agoI'm from Spain. Lula it's closer to our current social-democratic goverment than communism. It just happens that you are so right-leaned that you don't even realize what are you looking at.
- voz_ 3y agoNone of this independence is deserved if brazil continues raping the Amazon. I also find the take on decoupling from russia weak and cowardly.
- impeplague 3y agoIt's not like Brazil want to take sides either, so this might be a excuse, not a reason. And there is the BRICS, so taking side is not a good idea. BTW, unlike Europe, there is no consensus here that the side to be taken is with Ukraine.
- 11235813213455 3y agoI gope you guys are not going to copy USA & Europe in term of bread consumption, it's not worth! eat more vegetable, like peas, even quinoa, fruit, they're adapted to your climate and much more nutritive and healthy
- cassianoleal 3y agoBread is and has always been a staple in Brazil. Quinoa is a fairly recent development over there, and is quite expensive. Definitely not adapted to Brazilian climates although it can be made to work. Wheat OTOH is very adapted and cheap.
- News-Dog 3y agoFertilizer - Production : https://en.wikipedia.org/wiki/Fertilizer#Production https://en.wikipedia.org/wiki/Fertilizer#Production