Dairy Farmers/Investors There Exists Potential in Brazil for You.

Some pioneering entrepreneurs are investing in the development of the dairy industry near the town of Luis Eduardo Magalhaes in western Bahia and are looking for adventurous dairy people to join them in their quest to develop the dairy industry on the high tropical plains of Bahia. Western Bahia is already famous for its agricultural development in recent decades. However, soybeans and cotton get most of the headlines in this area that is actually agriculturally diverse. Other crops include fruits, cattle and coffee.  

The initial phases have already begun which include the purchase and expansion of the local dairy processing plant and the construction of a modern dairy farm, Fazenda Espirito Santo. This farm is pasture based with Tifton 85 under irrigation. The center of production is 110 hectare/270 acres of Bermuda grass (Tifton 85) with center pivot irrigation and a double 40 swing over parlor, milk house and 320 headlocks for supplemental feeding/cow handling. Divided into 48 paddocks it is estimated that 900 to 975 milking Jersey cows can be maintained, nearly 3.5 cows per acre year around.

The concept is that this dairy farm will work as a production model and others can follow suite using this example to develop other highly profitable dairy production sites.

 

Why Western Bahia?

Two good reasons. Good Climate and low land prices offer excellent opportunities for profitable dairy farming.

Climate advantages

Not as Hot and Humid as other Tropical Locations.  Because of the higher elevations of the land in western Bahia, about 900 – 700 meters above sea level. The climate is very agreeable for people and cattle not to mention many types of cultivation.

Continual Growing Season. West Bahia has a rain season from October through April with about 60 inches of rain depending on location. With irrigation high producing pastures can be utilized virtually year around and row cropped land can produce 2 to 2.5 harvests per year.

Lower Productions Costs. The financial and herd health benefits of a grazing operation can be a realized during the entire year. Less investment required in structures because cattle can be on pasture most of the time and protection from winter weather or excessive heat or humidity is not necessary. Like all grazing dairy farms less investment on equipment and reduction in labor costs can lead to higher profitability.
                                                                                                                                               

Land Advantages

Very affordable land prices. Farmland in West Bahia that has already been developed and farmed for a number of years and has some irrigation in place is currently listed at about US$900 per acre.  Without irrigation this land can typically produce 50+ bu of soybeans per acre. With irrigation this level of production can be increased along with number of crops per year.

Note: Fazenda Espirito Santo is currently working with the consulting firm CONSUPEC. CONSUPEC specializes in grazing operations/pasture management in Brazil. With 14 years of experience they have worked with over 207 clients on 253 farms in 11 different states through out Brazil. Here is a quote from an e-mail received 2/5/08 from a consultant at CONSUPEC.

CONSUPEC is advising John Da Silveira and also a client from New Zealand that is investing in the production of milk here in Brazil, specifically in southwest Bahia.
                                                                       
I see a lot of potential in pasture based milk production in this region. Not only in southwest Bahia but in nearly all of Brazil that has favorable temperatures for the production of tropical grasses. Being located in the Tropic of Capricorn it is possible to produce more than 60 metric tons of Dry Matter per hectare, this is sufficient to maintain an average stocking rate of 10 animal units through the year or able to produce more than 30,000 liters of milk per hectare per year.

Example: Average production of the lactating herd is 12 liters/cow/day X 8.5 cows/Ha X 365 days = 37,230 liters of milk/Ha/yr. 37,230 lt X R$.70(US$.39) = R$26,601/Ha(US$15,163/Ha) of revenue per year. Considering 20% profitability and 80% for costs we would therefore have R$5,212.20(US$2970.84) liquid margin per hectare.

Sincerely

Athila