Global Agriculture Leaders: Enhancing Farmer Success in the U.S. and Brazil

By Patrícia Arantes de Paiva Medeiros, Executive Director of the Brazilian Rural Society (June 10, 2025)

To understand the relevance of the United States' market power, it is essential to understand its structure for promoting agriculture and livestock. Originally, the United States had a system of public policies supporting rural producers—such as credit, infrastructure, and technology programs—primarily established through the U.S. Farm Bill.

North American legislation is based on four major themes: production, agricultural insurance, commodities, and environmental conservation, giving rise to specific policies and programs for the crops of greatest relevance for production, according to the graph below:

Projected outlays under the 2018 Farm Act, 2019-23*

*NOTE: The most recent U.S. Farm Bill, the "Agriculture Improvement Act of 2018," was signed into law on December 20, 2018. It was extended through September 30, 2024, and then further extended through September 30, 2025. 

Fonte: USDA, Economic Research Service based on Congressional Budget Office, Direct Spending Effects for the Agriculture Improvement Act of 2018, December 11, 2018.

Therefore, North American agricultural production benefits significantly from public policies aimed at promoting credit access and productivity.

When comparing the business environments of Brazil and the U.S., it is evident that North America incorporates many best practices. In Brazil, we have the “Brazilian Cost” that refers to ways of doing business that reduce the competitiveness of Brazilian products, including the agribusiness products.

For example, let’s look at the corn sector: the direct costs of corn production in Mato Grosso, the largest corn producing state in Brazil, have experienced similar increases since 2016, similar to Illinois. Direct costs in Mato Grosso surged to record levels for the 2023 corn crop, but projections indicate a decline for the 2024 corn crop, also in line with cost projections for Illinois. On a per acre basis, total direct costs and the costs associated with fertilizer, seed and pesticide inputs have been consistently lower in Mato Grosso compared with Central Illinois. However, a significant yield differential exists with Central Illinois achieving corn yields that are often more than double those of the second corn crop produced in Mato Grosso. “While the average yield of corn through growing areas in Brazil has grown over the past few decades, productivity continues to lag far behind corn yields in the United States.”[1] 

There is a clear need to eliminate the Brazilian Cost for producers, which would significantly reduce transaction costs that make Brazilian production more expensive than in other countries, such as the United States. For example, direct production costs in Illinois decreased, and total Brazilian costs, specifically in Mato Grosso, increased by 3 percent for the 2024 corn crop year.

It is important to recognize that Brazil and the U.S. collaborate to supply the world with products aimed at addressing food insecurity and reducing instability in the global food supply. Roberto Rodrigues, one of the most important ministers of the Brazilian agriculture, always said that agribusiness brings peace.

Brazil stands out in the global geopolitical landscape due to the stability of its commercial production. As the world’s third-largest exporter of agricultural products, Brazil maintains commercial export relationships with over 200 countries and, especially during the COVID-19 pandemic, established itself as a stable and reliable supplier. It is evident, therefore, that Brazilian agribusiness has the potential to solidify its leadership by pursuing greater efficiency in both commercial and international relations, while also contributing to global food security.

According to the USDA’s Outlook for U.S. Agricultural Trade released in June 2023, global economic and political instability has reduced U.S. exports: “U.S. agricultural exports in fiscal year (FY) 2023 are forecast at $181.0 billion, down $3.5 billion from the February forecast. This revision is driven by decreases in corn, wheat, beef and poultry exports. Corn exports are forecast $2.1 billion lower to $14.5 billion on lower unit values ​​and volumes, as Brazil is poised to harvest a record second crop corn.”

Comparing those numbers to 2025, particularly with the tariffs and the monetary policy of the current U.S. administration, it is important to note that in the trade relationship between the U.S. and Brazil, there is a trade surplus for the U.S. in relation to Brazil. The U.S. exported over $49.7 billion worth of agricultural products to Brazil, making Brazil the ninth-largest destination for North American exports. Conversely, Brazil exported over $42.3 billion worth of agricultural products to the U.S., making it the 18th-largest exporter to North America.

According to Bloomberg Economics, newly imposed tariffs could increase the average U.S. tariff by up to 28 percent, potentially reducing U.S. GDP by 4 percent and increasing prices by as much as 2.5 percent over a two- to three-year period.

In light of the decline in U.S. agricultural production, a recent report by The Economist highlighted Brazil’s Midwest and Cerrado regions, drawing a comparison to the state of Texas. The strong competitiveness of Brazilian products, along with the regional development boom driven by interior agricultural production, stands out in contrast to the U.S. market—intensifying competition. Based on the referenced data, it is crucial for both North American and Brazilian producers to recognize complementary trade opportunities, strengthening their positions as reliable and competitive global food suppliers, while promoting economic development and enhancing productivity.

ABOUT THE AUTHOR

Patrícia Arantes de Paiva Medeiros is executive director of the Brazilian Rural Society, and also is advisor to the Federation of Industries of the State of Goiás (FIEG) in the agribusiness and food and beverage chambers.

A lawyer specializing in agribusiness, Medeiros holds a master’s degree in law, justice and impacts on the economy from the Center for Studies in Economic and Social Law (CEDES). She has a LLM in business law from FGV, and a postgraduate degree in economic analysis of law from the Faculty of Law of the University of Lisbon (FDUL). She also holds a postgraduate degree in business ethics from the University of São Paulo (USP).

Paiva Medeiros is the author of the book "Economic Analysis of Agribusiness: Competitiveness in the Global Agricultural Market."

SOURCES: 

[1] COLUSSI, Joana. PAULSON, Nick. SCHITKNEY, Gary. Comparing Corn Production Direct Costs: United States vs. Brazil. University of Illinois. Department Agricultural and Consumer Economics. Weekly Farm Economics. https://farmdocdaily.illinois.edu/2024/01/comparing-corn-production-direct-costs-united-states-vs-brazil.html