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Cattle ranching

Better management, more profit

Project rehabilitates small rural producers

In 2002, Carlos Santim, the owner of an area a little larger that 30 hectares, in the municipality of Uirapuru, in the State of Sao Paulo, decided to substitute the coffee crop  for a herd of cattle of seventy ) Dutch and mixed breed of cows that would produce 430 liters of milk per day. Today, the small farm’s productivity, well above the average for the region, guarantees Santim an income of around ten minimum salaries (R$3,000) and feeds him dreams of expansion. He has just bought eight calves with resources coming from the National Program for the Strengthening of Family Agriculture (Pronaf in he Portuguese acronym), of the Banco do Brasil, and aims to reduce costs with animal feed. He has done his sums and guarantees: in 2006 he will reach a production of 7,000 liters of milk per day. To those who suspect that the target is unattainable he reminds them that, in only two years his farm production grew almost seven times. Maintaining this progress, Santim’s plans could even be conservative. “I learned to manage the herd and to administer the property” he explains.

The techniques of looking after the herd and of managing the business he learned from one of the two hundred and forty skilful personnel of the Coordination of Integral Technical Assistance (Cati), who, for their part, were trained by specialists from the Brazilian Agricultural Research Corporation (Southeast Embrapa Cattle), within the environment of the project Family Agriculture- Milk.

Created in 1999 and installed some two and a half years ago, the project has as its objective the transfer of knowledge concerning intensive production and milk yield for small farmers along with the techniques of rural extension. The “class rooms” are small family farms, such as that of farmer Santim, in which Embrapa specialists discuss, analyze and evaluate agricultural and zootechnology practices together with the rural producers and Cati technicians. “In the rural properties what’s missing most is information to produce milk in a simple manner, nevertheless profitable, and using concepts that are highly technical and environmentally sustainable” affirmed Artur Chinelato de Camargo, a researcher at Southeast Embrapa Cattle, and one of the mentors of the project.

Uninformed, the small producers do not make use of basic practices, such as the analysis of the soil, control of milk yield, standard planted area or exams for identifying animal diseases. Poorly fed, the herd will not have the productive potential and will not guarantee an income to the producers, who end up not looking after their property, before abandoning the activity and very often selling their land and moving to the city.

This was exactly the picture that the Cati technicians found with the majority of the one hundred and nine São Paulo farms in which they have already implanted the project. “The first step is to promote a clean up in the area and to rescue the producer’s self-esteem” says Adalberto Estivar, a Cati technician, responsible for the success of the farmer Santim enterprise.
The second step is to deal with changing the animal’s feed, substituting, whenever possible, the use of animal feed – more expensive- for grass. “In order to produce milk it is not necessary to feed the cows exclusively with animal feed” explains Estivar. But, before that, one needs to teach the producers how to make fertilizer and how to manage pasture. Grass guarantees the feeding of the animals with the production of twelve liters of milk per day. Animal feed should only be used as a food supplement for the more productive animals. The technical personnel recommend that, instead of buying the animal feed on the market, the producers should manipulate it, making use of seasonal products. The result is that, instead of paying R$ 0.52 per kilo for conventional animal feed, he only spends R$ 0.30. From this stage on, the technicians initiate the work with the herd, with the identification of the productive animals and the discarding of those with poor efficiency. “The investment has to come back in milk.”

The farm owners are also convinced to adopt cost planning, where they will religiously note down their incomes and expenditures on a daily basis. “At the beginning, in order to reorganize the activity, they only have expenses and become dumfounded. When the positive results begin to appear, they make plans for growth” says Estivar.

The most delicate step is to induce them to adopt irrigation. “This frightens the producers” he justifies. With irrigation the period of dry pasture reduces to some three months during which the grass can be substituted by corrected sugarcane, or that is, rich in protein and with added urea mineral.

Simple formulae
The budget plans used by the farmers include simple formulae that allow for the accounting of equipment depreciation, interest payments on the capital invested in the land, a “salary” for the farmer, among others in such a manner that he can evaluate the profitability of the business. “Little by little the farmers discover that the milk covers all of their investments.” When the accounts are done, they verify that the production cost of each liter of milk -sold for R$ 0.52 – is R$ 0.32. “The gross profit is R$ 0.20 per liter of milk” says Estivar. “The model is logical, is economy of scale. If the production were to be 50 liters per hectare/day, which is low, the farmer loses out. He has to achieve 200 liters.”

In order to integrate themselves into the project captained by Embrapa, the farmers have some responsibilities to uphold on their part, explains Chinelato: they have to leave the property “open” for visits by the local technicians, to carry out exams for brucellosis and tuberculosis on their animals every four months and discard any sick animals.
The project has the support of the farmers’ cooperative, cities, and, in some regions, of the Brazilian Support Service to Micro and Small Companies (Sebrae). “This is a cheap project with positive results” underlines Chinelato.