September 17, 2012

In Mato Grosso Corn Accounting for Larger Share of Gross Income

Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.

One of the mega trends in Brazilian agriculture over the last five years has been the expansion of the safrinha corn crop. It has increased to such an extent that the safrinha corn crop now accounts for more than 50% of Brazil's total corn production. The number one producing state of safrinha corn is Mato Grosso followed by Parana. Together, these two states account for approximately 65% of Brazil's total safrinha corn production.

This increased use of safrinha corn has helped to improve the gross receipts per hectare for farmers in Mato Grosso. In western Mato Grosso, safrinha corn accounted for 20% of the gross receipts per hectare in 2007/08 and that increased to 33% in 2011/12. During the same period in southern Mato Grosso, the total gross receipts per hectare attributed to safrinha corn went from 19.7% to 23%. During the same period, the safrinha corn yields in southern Mato Grosso have also increased 32% from 80.5 sacks per hectare in 2007/08 (4,830 kg/ha or 74.3 bu/ac) to 106 sacks per hectare in 2011/12 (6,360 kg/ha or 98 bu/ac).

Agricultural production in central Brazil, including the states of Mato Grosso, Goias, and Mato Grosso do Sul, has evolved in such a way that farmers in the region can now expect to produce two crops of grain per year, a first crop of soybeans and a second crop of corn. The increased production, coupled with strong commodity prices, has resulted in an improved bottom line for farmers in the region.

According to the Mato Grosso Institute of Agricultural Economics (Imea), the soybean acreage in the state is expected to increase 11% from 7.09 million hectares to 7.89 million hectares or an increase of 800,000 hectares. Imea is estimating that the soybean production in the state will increase 12.9% from 21.36 million tons in 2011/12 to 24.1 million tons in 2012/13.