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August 29, 2012

Agricultural Lime Essential Ingredient for New Soybean Production

Record high prices for soybeans are encouraging ranchers in eastern Mato Grosso to convert their underperforming pastures to additional soybean production. In addition to record high soybean prices in Brazil, the combination of poor pastures and low cattle prices is making soybean and corn production even more attractive for ranchers in the area.

In order to convert pastureland to row crop production, the ranchers must neutralize the naturally acidic soils in the region. They do that by applying agricultural limestone, but inadequate infrastructure in the form of poor roads makes it expensive to truck in the needed limestone. One ton of limestone can cost R$ 42 to R$ 49, but the freight charges to bring in the limestone can be as high as R$ 60 to R$ 110 per ton, or twice the cost of the limestone. Initially, 5-6 tons of limestone needs to be applied and then every 3-4 years an additional 1-2 tons of limestone is needed to maintain the correct ph of the soil.

According to the Mato Grosso Institute of Agricultural Economics (Imea), soybean acreage in eastern Mato Grosso is expected to increase 26% in 2012/13 to 1.2 million hectares. The cost of converting pastureland into row crop production (including clearing the land, disking, and limestone application) is estimated at R$ 1,000 per hectare. In addition to the land preparation, an additional R$ 1,220 per hectare is necessary to purchase the inputs needed to produce a crop of soybeans.

During the first few years after conversion, the soybean yields are generally below average until the soil nutrients are equilibrated correctly and the pasture grass is fully decomposed. On the positive side, these new soybean areas generally have less disease and insect pressures, at least initially. Once the soil nutrients are adequate, the soils in the region are capable of producing 50 to 55 sacks of soybeans per hectare or 43.5 to 48 bu/ac.

The conversion of pasturelands to row crop production is becoming the new agricultural frontier in Brazil. It is not only occurring in Mato Grosso, but in other states as well such as Mato Grosso do Sul, Goias, and Tocantins.