Jun 01, 2010
Cost of Producing Soy in Mato Grosso Estimated at R$ 1,425/ha
Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.
For the 2010-11 growing season, the cost of producing soybeans in central Mato Grosso is estimated at R$ 1,425 per hectare (US$ 325 per acre), which is almost identical to the cost of production in 2009-10, but it's 27% cheaper than the R$ 1,955 per hectare (US$ 447 per acre) that it cost during the 2008-09 growing season. According to the Mato Grosso Institute of Agricultural Economics (Imea-MT), southeastern Mato Grosso will be the most expensive location to grow soybeans in 2010-11 at R$ 1,543 per hectare (US$ 352 per acre) followed by western Mato Grosso at R$ 1,504 per hectare (US$ 343 per acre).
Fungicide costs are expected to decline in 2010-11 and fertilizer costs are expected to increase in 2010-11. Farmers in the state spent on average R$ 95.99 per hectare (US$ 22 per acre) on fungicides in 2009-10 due to higher incidence of soybean rust. The average fungicide cost for 2010-11 is expected to decline to R$ 71.88 per hectare (US$ 16.50 per acre), which is 25% cheaper compared to last year. The anticipated reduction is the result of an expected lower incidence of soybean rust.
In contrast to lower fungicide costs, the costs of fertilizers are expected to increase in 2010-11. During the 2009-10 growing season, the average fertilizer cost in Mato Grosso was R$ 336 per hectare and in 2010-11, it is expected to be R$392 per hectare or up 17%. If these estimates turn out to accurate, fertilizer costs will account for approximately 28% of the total costs of growing soybeans in Mato Grosso.
Mato Grosso soybean farmers spend more on fertilizers to produce their soybeans than any other soybean growers in the world. The soils in Mato Grosso need a lot of fertilizers to start with and the cost of transporting the fertilizers to the middle of the continent over poorly maintained roads adds to the costs. That is one of the reasons why farmers in central Brazil continue to push the federal government to increase their spending on improving the infrastructure of Brazil.
Seed costs are also expected to increase in 2010-11 compared to last year. It is estimated that the average seed cost in Mato Grosso will be R$ 118 per hectare (US$ 27 per acre) compared to R$ 104 in 2009-10 (US$ 23.70 per acre), or an increase of 13%.