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September 3, 2014

Cost of Production Estimates for 2013/14 Growing Season in Brazil

Brazilian farmers will go to the field later this month to start planting their 2014/15 crops facing some of the lowest commodity prices in recent years. With lower prices and higher costs, there is a difference in opinion as to how this might impact soybean and corn acreage in Brazil. Below is a table I published in my October 15, 2013 weekly report.

This information was published by Conab in their October 2013 Crop Report, which was their first report of the 2013/14 growing season. Remember, these production costs are therefore one year old and the cost of production has increased over the previous year, but it will still give you a general idea about the cost of producing crops in Brazil. I expect Conab to issue new cost of production estimates in their October 2014 Crop Report and when they do, I will update this chart.

  • Production costs are based on the combined total fixed costs and variable costs including land costs.
  • These are average costs calculated during July of 2013.
  • Conab only gave the cost per sack of 60 kilograms and I made the conversion to dollars per bushel using the exchange rate of 2.25 Brazilian reals per US dollar.
  • These are approximate costs based on average yields for the region listed.
  • The wide variability in cost is due to the yield potential for the various regions, soil fertility, fertilizer applications, and the cost of transporting the inputs to the various regions.
  • These costs do not include the cost of transporting the grain to the local grain elevator or eventually to end users or export facilities.
  • The locations are generally listed going from north to south in Brazil except for the states of northeastern Brazil (Bahia, Maranhao, and Minas Gerais) which are listed last in each group.

Cost of Producing Soybeans and Corn in Brazil - 2013/14

Soybeans - GMO Total Cost R$/60 kg Total Cost US$/bushel
Sorriso - central Mato Grosso 40.37 8.15
Campo Novo do Parecis - western Mato Grosso 45.269.14
Primavera do Leste - southeastern Mato Grosso 45.46 9.18
Chapadao do Sul - northern Mato Grosso do Sul45.65 9.22
Brasilia - Federal District 38.967.87
Rio Verde - southern Goias 38.047.68
Londrina - northern Parana 38.03 7.68
Campo Mourao - western Parana33.31 6.72
Santa Rosa - northwestern Rio Grande do Sul 43.69 8.82
Passo Fundo - eastern Rio Grande do Sul 47.89 9.67
Barreiras - western Bahia42.58 8.60
Balsas - Maranhao 39.207.91
Averaged across all locations41.53 8.38
 
Soybeans - Conventional (non GMO)
Sorriso - central Mato Grosso 40.08 8.09
Campo Novo do Parecis - western Mato Grosso 44.268.94
Primavera do Leste - southeastern Mato Grosso46.79 9.45
Londrina - northern Parana 43.27 8.74
Campo Mourao - western Parana35.15 7.10
Unai - northwestern Minas Gerais47.489.59
Averaged across all locations 42.83 8.65
 
Corn - Full Season
Primavera do Leste - southeastern Mato Grosso 26.335.08
Chapadao do Sul - northern Mato Grosso do Sul17.48 3.37
Londrina - northern Parana 22.464.34
Campo Mourao - western Parana26.98 5.21
Passo Fundo - eastern Rio Grande do Sul22.184.28
Barreiras - western Bahia22.26 4.30
Balsas - Maranhao 19.333.73
Unai - northwestern Minas Gerais25.584.94
Averaged across all locations22.824.40
 
Corn - Safrinha
Sorriso - central Mato Grosso 20.153.89
Vera - central Mato Grosso 20.914.04
Campo Novo do Parecis - western Mato Grosso 18.043.48
Campo Verde - southern Mato Grosso 18.923.65
Chapadao do Sul - northern Mato Grosso do Sul24.49 4.73
Rio Verde - southern Goias 27.355.28
Londrina - northern Parana24.644.76
Campo Mourao - western Parana31.616.10
Ubirata - western Parana 24.484.73
Averaged across all locations23.394.51

Source: Conab's first estimate of the 2013/14 growing season - October 2013