August 23, 2010

Brazil's top soy companies double soy area in Mato Grosso

Top soy producers have doubled the size of their soy areas in the last five years in Mato Grosso, Brazil's top soy producing state, said Mato Grosso's Agricultural Economy Institute, or Imea.

"This is part of a natural trend for concentration by the biggest players and we expect this trend to continue for the coming years," Otavio Celidonio, CEO at Imea, said Friday (Aug 13).

Celidonio said that the top 20 biggest international and Brazilian agricultural companies in Mato Grosso planted 1.2 million hectares in 2009-10 versus 533,700 hectares in 2004-05.

"These companies account for 20% of the soy grown in Mato Grosso on 6.2 million hectares, as often indebted small-and mid-size farmers sell their land.Big companies have economies of scale and can often get better prices for their beans. They also pay less for their inputs such as fertilizer," Celidonio said.

For a long time, Mato Grosso has seen companies such as Grupo Andre Maggi running giant agribusiness operations. This compared to Parana, the second soy producing state, where farmers are more often smaller in size and linked to cooperatives. Mato Grosso has also recently seen the arrival of large-scale international players such as Argentina's Los Grobo and El Tejar.

The 2009-10 soy harvest ended in May and planting for the new 2010-11 crop will begin in September in Mato Grosso. Brazil is the world's second major soy producer after the US.