Specialist Luiz Fernando Pacheco, analyst at T&F Consultoria Agroeconomia, explained that there are several reasons for Brazilian producers to plant more wheat in this next harvest. According to him, the motivations range from improving the soil to economic and market reasons.
The first of them, according to the specialist, is the need for producers to be able to dilute their property costs in winter, in addition to providing soil cover in the cold season and not leaving it fallow. Furthermore, many technical reports show that, when well managed, soybean areas on top of wheat are more productive, or even require less investment in fertility.
“Because, in this harvest, there is the opportunity to finance the crop with the exchange of inputs, since agricultural credit is scarcer (we called the credit department of a cooperative center who told us that there is no credit for all crops – the banks distribute only a little credit to each person, to have it for everyone) and the farmer has to look for alternatives – either more expensive credit at the same bank or through the barter system, exchange for grain”, he indicates.
Regarding market reasons, the prices presented so far for future wheat, of R$ 680/700 in Rio Grande do Sul and R$ 800 in Paraná, are higher than the same prices offered at the beginning of the last harvest, which started with prices of R$ 600 in RS and R$ 700 in PR. “Strictly speaking, wheat will have a profitability (return on investment) at least equal to that of soybeans and higher than that of corn, in this harvest. From what it appears at the moment, soybeans should have their price reduced to R$ 70.00/bag FOB interior in the second half of the year”, adds Pacheco.
Source: agrolink | Author: Leonardo Gottems
