Agriculture in Paraguay
[1] The sector comprised a strong food and cash crop base, a large livestock subsector including cattle ranching and beef production, and a vibrant timber industry.
In the aggregate, however, the advances experienced by the sector during the 1970s and 1980s did not reach many of the small farmers, who continued to use traditional farming methods and lived at a subsistence level.
Epitomizing the country's economic activity in general, the agricultural sector was consolidating its quick expansion over the two previous decades and only beginning to tap its potential in the late 1980s.
After 1954, multinational agribusinesses, mostly Brazilian and American, played an increasing role in the economy, often purchasing enormous tracts of land devoted to raising cattle, cotton, soybeans, and timber.
A more fundamental component of the Agrarian Statute was the creation of the Rural Welfare Institute (Instituto de Bienestar Rural—IBR) in 1963 by Juan Manuel Frutos Fleitas, a minister in the Stroessner government.
[3] From 1963 to the late 1980s, the IBR titled millions of hectares of land and created hundreds of colonies, directly affecting the circumstances of roughly one-quarter of the population.
In the late 1980s, the IBR remained the key government agency, along with the Ministry of Agriculture and Livestock, in serving the land needs of small farmers.
[3] Although the IBR played an important role in stimulating the celebrated "March to the East," the exodus from Paraguay's central zone to the eastern border region that began in the 1960s was a spontaneous process.
The task of the IBR was so enormous and its resources so limited that many of the country's farmers bypassed the institute in order to participate in the eastward land grab.
[4] The country's land use changed rapidly in the 1970s and 1980s as foreign investment, Paraguayan and Brazilian colonists, the construction of Itaipú, favorable commodity prices, and new infrastructure all contributed to the penetration of the dense eastern region.
[6] The major constraint on growth in soybean output, besides price fluctuations, was the lack of storage, drying facilities, and local processing capacity.
[6] Another reason for the tobacco crop's decline was the inability of the domestic cigarette factories to improve quality control and compete with smuggled brands.
Sugar production, however, was expected to be modernized and increasingly commercialized as a result of its high government priority as an input to an alternative energy source.
One of Latin America's largest oilseed exporters, Paraguay processed cottonseed, soybean, peanut, coconut, palm, castor bean, flaxseed, and sunflower-seed oils.
For two decades, the government's national wheat program had encountered numerous obstacles: seeds inappropriate for Paraguay's climate, skyrocketing prices for alternative crops, poor weather, blight infection, and a lack of proper farming practices.
Despite the rapid expansion, wheat production in the 1980s was hurt by floods, droughts, and cheap contraband, all of which caused flour mills to operate at about half of capacity.
Bananas, plums, strawberries, pears, avocados, guavas, papayas, mangoes, grapes, apples, watermelon, and other melons were cultivated to varying degrees as well.
[citation needed] Raising and marketing livestock, a traditional source of livelihood in Paraguay, remained a major segment of agriculture and the economy at large during the 1980s.
By contrast, extremely large cattle ranches typically were owned by expatriates and butchered more productive animals for both national and international markets.
The country's beef exports expanded until 1974, when Paraguay lost access to European Economic Community (EEC) markets and lower world prices further stagnated output.
Paraguay's principal export markets were Brazil, Peru, Chile, the EEC (specialty items only), Colombia, Uruguay, and Saudi Arabia.
[citation needed] Official government policy favored strong cattle development and exports, a view articulated in national livestock programs since the early 1960s.
The FG was not only the major lender to the industry, but it also provided certain veterinary equipment and medicine, encouraged quality control in meat and dairy products, and operated a model farm in the Chaco.
Trees were processed at over 150 small, mostly outdated sawmills that produced wood products for the paper, cardboard, construction, and furniture industries and for export.
The rapid depletion of Paraguay's woods was caused by the clearing of virgin forests associated with agricultural colonization, the farming practice of land-clearing and treeburning, and the felling of trees for charcoal and the other fuelwoods that accounted for 80 percent of household energy consumption.
In fact, Paraguay's per capita consumption of fuelwood was the highest in all of Latin America and the Caribbean and nearly three times the level of other South American countries.
[10] Government policy was slow to respond to deforestation because of the traditional abundance of forests as well as the generally laissez-faire dynamics of the land colonization process.
In 1973 the government established a National Forestry Service under the Ministry of Agriculture and Livestock to protect, conserve, and expand the country's forests.
It is a large-scale project, formed by an important group of Paraguayan entrepreneurs and Argentineans in conjunction with the Moises Bertoni Foundation and the Environmental Law and Economics Institute (IDEA).
[citation needed] The organization evaluates economic, social and environmental values for companies in Paraguay, ensuring that they comply with social and environmental regulations for instance, drawing up management plans and granting licenses and offering expertise on the use of agro chemicals and managing the Paraguayan environment in coordination with ideologies of sustainable development.
