Impact of the adoption of Brachiaria grasses: Central America and Mexico

F Holmann, L Rivas, P J Argel and E Pérez

International Center for Tropical Agriculture (CIAT) and International Livestock Research Institute (ILRI).
Cali, Colombia: F.Holmann@cgiar.org
*Impact Assessment Unit. CIAT. Cali, Colombia: L.Rivas@cgiar.org
**Tropical Forages Project, CIAT. San José, Costa Rica: P.Argel@cgiar.org
***Regional Director, ILRI. Managua, Nicaragua: Edwin.ilri@cablenet.com.ni

Summary

Livestock production plays a key role in tropical Latin America in a changing economic environment. This study focuses on documenting the transformations of extensive production systems by using superior forage germplasm supplied by regional research systems.

The adoption of improved Brachiaria grasses was evaluated from 1990 to 2003 to estimate its impact in terms of animal productivity and income in Central America and Mexico. Information on seed sales in the local market made it possible to estimate the areas planted and the value of additional milk and beef production attributable to adoption.

Mexico presents the highest volume of marketed seed and of area established with improved pastures. Among Central America countries, Costa Rica was outstanding in terms of the high volume of seed sold and the area planted, followed by Honduras, Nicaragua, and Panama. The annual growth rate of seed sales was very high during the study period, reaching 32% in Mexico, 62% in Honduras, 45% in Nicaragua, 39% in Costa Rica, and 54% in Panama. The area planted with Brachiaria species during this period totaled 6.5% of the total surface of permanent grasses in Mexico, 12.5% in Honduras, 1.0% in Nicaragua, 18.7% in Costa Rica, and 0.1% in Panama.

Excluding Nicaragua and Panama, where adoption is low, Brachiaria grasses account for 24%-55% of total annual milk production and for 5%-18% that of beef. These figures clearly demonstrate that those adopting new Brachiaria cultivars are farmers mainly oriented toward milk production and, to a lesser extent, beef.

In monetary terms, the value of additional production attributable to the adoption of Brachiaria grasses in the selected study countries was estimated at US$1084 million per year, 78% corresponding to milk and 22% to beef. Due to the magnitude of the livestock sector in Mexico, adoption generates slightly more than 80% of production profits.

Study results indicate that the investment of public funds in Central America and Mexico to support the International Network for Evaluation Tropical Pastures (RIEPT, its acronym in Spanish) paid off in terms of adoption of improved grasses and significant increases in the supply of milk and beef, fundamental items in the diet of consumers from all income levels in the region.

Keywords: Adoption, Brachiaria, beef and milk production.

Introduction

The livestock sector plays a key role in the economy of tropical Latin America, where a large part of the land resources with production potential is located, constituting an important source of food and employment for all social strata (Holmann et al 2004a).

This activity has frequently been criticized as being based on extensive production schemes in pastures of low productivity, which, together with the pressure exerted by cash crops for land, has forced livestock production to move toward more fragile, less productive ecosystems. This phenomenon has been documented for Brazil, where livestock production moved from the southern states toward the Midwest (Serrão and Toledo 1989), for Colombia where it moved from the Northern Coast and the Inter-Andean Valleys toward the Orinoquia and Amazon regions (Vera and Rivas 1997), and for Central America where it moved from the fertile Pacific region toward the Atlantic region (Kaimowitz 1995).

Empirical evidence exists, however, that this situation is changing due to global economic pressure. Competitiveness and sustainability are now critical components of the success and survival of any given production activity. Research carried by national and international centers to develop highly productive, adapted forage materials has contributed critical technological elements for changing the production patterns of these extensive systems. Brachiaria pastures have made it possible to achieve substantial increases in livestock productivity in many Latin American countries.

The migration of livestock production to other ecosystems can be mainly attributed to pasture degradation, which results in losses not only of quality but also of quantity of forage biomass. This in turn induces losses in animal productivity and farmer income up to the point where they are irreversible and farmers are forced to migrate to other areas, usually marginal in terms of geographical location and production potential. This triggers the destruction of natural resources, which begins with deforestation and ends up with soil degradation.

Pasture degradation is linked to the establishment of pastures in fragile lands (for example, hillside areas); the use of poorly adapted pastures; overgrazing during the rainy season; frequent and uncontrolled burning of pastures; and nutrient depletion (Spain and Gualdrón 1991). This phenomenon brings serious consequences to the livestock producer, by first reducing animal production yields and then increasing production costs.

A case study conducted in Honduras (Holmann et al 2004b) indicates that the country's annual production has decreased in 284,000 MT fluid milk and 48,000 MT beef per year, which is equivalent to 48% of the national milk production and 37% of beef production. This reduction is attributed to the severe degradation of 29% of the area in pastures.

The Tropical Forages Project of the International Center for Tropical Agriculture (CIAT) has accordingly directed financial and human resources toward:

• the improvement of animal productivity;
• the maintenance of soil productive capacity; and
• the improvement of the competitiveness of local production

The above can be achieved by offering:

• improved grasses and legumes adapted to soils of low to medium fertility; and
• forage options for animal feeding during critical period (for example, during the dry seasons)

The following benefits will be obtained:

• increased food availability;
• improved quality of life of producers and consumers, particularly of the poorer social groups; and
• conservation of the natural resource base using schemes of high productivity and sustainability.

International Network for Evaluation of Tropical Pastures (RIEPT)

A major effort has been made in Latin America to develop new pasture technologies aimed to increase the productivity of the region's traditional extensive livestock production systems, particularly in the continent's tropical lowlands. This multinational and inter-institutional effort was carried out through the International Network for Evaluation of Tropical Pastures (RIEPT), which operated over a 20-year period, from 1976 to 1996. The Network allowed Latin American institutions to share the germplasm of existing gene banks, study the performance of new germplasm under specific conditions and compare it with that in other sites of Latin America, and establish contacts to exchange scientific information and, as a result, extrapolate research results better (Toledo 1982).

During its existence, RIEPT trained 685 technicians of 34 countries of Latin America, Asia, and Europe (Holmann et al 2004c) in issues related to (1) pasture establishment and management, (2) seed production, (3) pest and disease control, (4) plant physiology, and (5) pasture improvement. The highest number of trained technicians came from Colombia and Brazil. Their training was key to the success of RIEPT, because they returned to work in public institutions that served as CIAT's liaison for agronomic evaluations and to provide feedback on pasture performance in the region's different ecosystems.

Eleven grass cultivars, most of them belonging to the Brachiaria genus, and 16 forage legumes have been released since RIEPT was established, mainly in Latin America but also in Australia and China (Holmann et al 2004c). These varieties are adapted to the adverse soil and environmental conditions of the tropics (CIAT 2003). Most grasses were released in the late 1980s and early 1990s and are called "first-generation grasses". Nowadays Brachiaria grasses dominate the market, accounting for 84% of seed sales over the last 5 years in Mexico and Honduras, 90% of those in Nicaragua, 85% in Costa Rica, and 97% in Panama (SAG 2004; SENASA 2004; DIGESA 2004; MAG 2004; IDIAP 2004).

Recently another series of forage grasses, also belonging to the genus Brachiaria, have been released-the so-called "second-generation grasses". Figure 1 indicates the first- and second-generation grass species released in Central America and Mexico from 1988 to 2008, as part of the collaborative effort between CIAT and national institutions. The Brachiaria breeding program already has Brachiaria hybrids resistant to the spittlebug, the first of which will be released in 2005. Other very promising hybrids are being tested with high probabilities of being released during the second half of this decade

Second-generation grasses have the following characteristics: (a) multiple resistance to the spittlebug; (b) resistance to foliar fungi such as Rhizoctonia; (c) improved adaptation to acid and flood-prone soils (for example, a broader range of adaptation); (d) improved seed production capacity; and (e) superior forage quality (Carlos Lascano, CIAT Tropical Forages Project leader, personal communication).

The Process of Adopting Tropical Grasses

The process of adopting pasture technologies is quite different from that of adopting crop technologies. The adoption and establishment of new pastures on farms is a long-term, highly complex decision that requires previous analysis and involves numerous biological and economic risk factors. The adoption of improved pastures requires a medium- to long-term investment, and many benefits are not seen immediately but over prolonged periods during which substantial changes may occur in economic (for example, price changes) and environmental (for example, pests, diseases, and droughts) conditions. The decision of whether to invest or not in improved pastures involves a high level of risk (Rivas 1996).

Given the high establishment costs, the above-mentioned risk factors, and the financial constraints for establishing pastures, the adoption of new forage materials has accordingly been slow and limited, especially during the initial phases of adoption (Rivas 1996).

Objectives

The general objective of this study was to document the impact of forage technology on the transformation of the livestock sector in tropical Latin America, with emphasis on Central America and Mexico. Its specific objective was to quantify the economic impact of Brachiaria cultivars released by national research systems and provide evidence of the changes occurring in livestock systems, with intensification and sustainability being priority objectives.

Methodology

The Sáez and Andrade (1990) methodology was used to estimate the adoption of Brachiaria grasses as well as its impact on increased animal productivity and farmer income, based on a series of assumptions indicated in Table 1, which compares the levels of beef and milk productivity obtained when traditional technology is used with those obtained when improved pasture technology is used in Central America and Mexico.

The methodology estimates the areas planted based on the volume of seed sold in each country (for example, imported seed + locally produced seed). After determining the marketed volume and planting density (4 kg/ha), the net area planted each year is estimated per country. These estimates are further adjusted by 15% to take into account the increase in area attributable to plantings with vegetative material.

Pastures are assumed to have a useful life of 8 years. Therefore all areas planted as of 1990 were again reseeded starting in 1998 and discounted from the volumes of seed marketed as of 1998, according to the methodology described by Sáez and Andrade (1990).

To estimate additional milk and beef production due to adoption, the area planted was multiplied by the difference in productivity per hectare between traditional technology and improved Brachiaria-based technology. Similarly, to estimate the value of additional milk and beef production due to adoption, the additional milk and beef produced was multiplied by the farmgate price paid per country and per year during the period 1990-2003 (Table 2).

Results and Discussion

Adoption patterns

Figure 2 shows the theoretical pattern of adoption of new technologies over time and the apparent adoption curves in Central America and Mexico, based on the sales of Brachiaria grass seed from 1990 to 2003. Adoption was slow the first years after the grasses were released-the first half of the 1990s-and, as a result, initial availability of seed was low. Furthermore, farmers had limited knowledge about these new options. However, as farmers became familiar with these options, the purchase of seed grew rapidly, increasing exponentially in early 2000 and resembling the theoretical pattern of adoption.

Improved areas planted to pastures

Table 3 shows the marketed volumes of seed of Brachiaria grasses and the estimated area established with these improved grasses during the same period. Most of the seed was used to replace pastures in advanced states of degradation or native or naturalized pastures with very low productivity.

Mexico presents the highest volume of marketed seed and of area established with improved pastures. Among Central America countries, Costa Rica was outstanding in terms of the high volume of seed sold and the area planted, followed by Honduras, Nicaragua, and Panama. The annual growth rate of seed sales was very high during the study period, being above 30% in all study countries: 32% in Mexico, 62% in Honduras, 45% in Nicaragua, 39% in Costa Rica, and 54% in Panama.

The area planted with Brachiaria species during this period totaled 6.5% of the total are under permanent pastures in Mexico, 12.5% in Honduras, 1.0% in Nicaragua, 18.7% in Costa Rica, and 0.1% in Panama.

Additional value and production of milk and beef

Because of the large areas planted to Brachiaria species in Mexico, the additional production of milk and beef is highest in this country. In 2003, more than 2.3 million metric tons (t) of fluid milk were produced (Table 4), which is equivalent to 23.9% of the national production, and almost 157,000 t of beef, which is equivalent to 5.3% of the annual production of Mexico (FAO 2004).

In monetary terms, this additional increase in productivity represents more income-US$683 million for the sale of milk and US$195 million for the sale of beef (Table 5).

Similarly, the additional production in Costa Rica due to the adoption of Brachiaria cultivars exceeded 437,000 t of milk in 2003, which is equivalent to 55.5% of the national production. The increase in beef production surpassed 26,000 t, equivalent to 17.7% of the national production of that year (FAO 2004). The adoption of improved forage materials represented an additional income for livestock producers of US$114 million for the sale of milk and US$29 million for the sale of beef during 2003 (Table 5).

In Honduras, the marginal increase in milk production has been above 149,000 t of fluid milk, equivalent to 25.0% of domestic production. In the case of beef production, the adoption of Brachiaria species has triggered an additional increase of more than 13,000 t, equivalent to 11.5% of the national beef production. This increase represented additional incomes of US$36 million for the sale of milk and US$13 million for the sale of beef during 2003.

Of all the countries studied, the adoption of Brachiaria cultivars has been lowest in Nicaragua and Panama. In 2003, the additional increase in milk production in Nicaragua was 32,000 t (11.5% of the national production) and in Panama, 9,900 t (5.5%). In the case of beef production, the additional increase attributable to the adoption of this type of pastures was 2,100 t in Nicaragua (1.6 % of the national production) and 660 t in Honduras (0.6%). During 2003, these increases in productivity represented additional incomes of US$8 in Nicaragua and US$3 million in Panama for the sale of milk, as well as US$2 and US$1 million for the additional sale of beef in the same countries.

The value of additional production attributable to the adoption of Brachiaria grasses in the selected study countries in 2003 was estimated at US$1,084 million per year, 78% corresponding to milk and 22% to beef. Due to the magnitude of the livestock sector in Mexico, adoption generates slightly more than 80% of production profits.

The technical change triggered by the use of new Brachiaria grasses in target countries generated US$1,689 million in profits (net present value) during this period. If that flow is distributed as annuity, then the countries received a fixed sum of US$229 million annually over this 14-year period of evaluation, allocated as follows: Mexico, $190 million; Honduras, $6 million; Nicaragua, $1.3 million; Costa Rica, $31.3 million; and Panama, $0.4 million.

Pasture adoption as a way to intensification and sustainability

Table 6 shows the evolution of milk and beef production in Mexico and Central America, as well as the expansion of the livestock herd and the area in pastures. Regional livestock production during the 1980s was able to maintain its growth because of the increased use of its basic production resources-land and livestock-rather than increases in productivity. Therefore most of the annual increases in milk production in Central America and of beef production in Mexico can be attributed to the larger animal inventory, associated with the incorporation of new areas into pasture. Externally and internally funded colonization projects also flourished, and subsidies through credit peaked (World Bank 1985).

Comparatively, the 1990s and early 2000s showed a trend toward intensified livestock production, with the adoption of Brachiaria grasses, as demonstrated in this study and by data provided by FAO. Table 6 indicates that the increases in milk and beef production during the 1990s and early 2000s cannot be attributed to increased herd growth, which were even negative during the 1990s, nor to increases in area of pastures, because they have been very small or null, suggesting that production increases are mainly associated with on-farm improvements of livestock feeding systems (for example, establishment of improved forages and/or increased levels of supplementation).

These data suggest that extensive systems tend to intensify production through the use of highly productive improved grasses. The schemes of the 1970s and 1980s, which were based on government subsidies and investments in infrastructure that favored and promoted the expansion of the agricultural frontier, are not longer in force in the region. Likewise, there is an increased awareness on conservation issues and efforts to recover degraded areas instead of occupying fragile ecosystems with low productivity. The present economic scenario also assigns special importance to competitiveness, which, in turn, strengthens the trend toward concentrating production in certain geographical areas.

Livestock production occupies a very high fraction of productive land (for example, 73% of the land used for agriculture in Central America and 76% in Mexico are under permanent pastures). This means that it is strategically important to grant priority to the conservationist use of areas under livestock production, while increasing their productivity so they can successfully compete in the global economy.

Conclusions

These figures clearly demonstrate that farmers adopting Brachiaria-based pastures are livestock producers mainly oriented toward milk production and, to a lesser degree, beef production. Prevailing production systems in the region indicate that the main adopters have been dual-purpose livestock producers.

In relative terms, the country that has most benefited from the adoption of Brachiaria cultivars is Costa Rica. The equivalent to 55% of the national milk production and almost 18% of the beef production in 2003 can be attributed to the marginal increase generated by increased pasture productivity, as compared with traditional technology. These benefits reflect the high adoption of Brachiaria pastures observed in Costa Rica, the country showing the highest rate of adoption of this technology in terms of percentage of area under permanent pastures (18.7%).

The underlying hypothesis of RIEPT was that lack of adaptation of commercial cultivars selected in other continents could be overcome by selection of locally adapted forage germplasm. This in turn required a large effort on multi-locational screening for adaptation to prevailing biotic and abiotic constraints.

The region dos not have comparative advantages for Brachiaria seed production, particularly in terms of soil and climatic conditions. However, grass seed production is a large commercial activity in Brazil, and much of the Brachiaria cultivars were marketed by Brazilian companies and sold regionally through local seed companies. The process of adoption of new Brachiaria cultivars has been stimulated by the availability at reasonable prices of commercial seed produced in Brazil pulled by an expanding regional livestock sector to meet increased consumer demand for milk and beef.

The results presented in this study indicate that the investment of public funds in Mexico and Central America to support the forage R&D network had high returns in terms of adoption of improved grasses, increased productivity, and significant increases in the supply of milk and beef- fundamental products in the diet of consumers from all income strata in the region.

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Received 13 September 2004; Accepted 14 October 2004

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