Jan 09, 2024

Direct Cost for Corn Production: United States vs. Brazil

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

One of the most frequent questions is get is "What is the cost of producing safrinha corn in Brazil? Fortunately, we now have an answer for safrinha corn production in Mato Grosso thanks to FarmDoc Daily.

The University of Illinois's Farmdoc Daily published a very interesting study comparting the direct cost of corn production in the United States vs. Brazil. The study is titled "Comparing Corn Production Direct Costs: United States vs. Brazil" by Joana Colussi, Nick Paulson, and Gary Schnitkey from the University of Illinois and Carl Zulauf from Ohio State University. It was published on January 2, 2024 and can be found at the following site:

The study compares the direct cost of corn production in Illinois and for the safrinha corn crop in Mato Grosso. Safrinha production accounts for approximately 75% of Brazil's corn production. Direct costs include the cost of production inputs, such as fertilizers, seeds, pesticides (herbicides, insecticides, fungicides), and costs associated with drying, storage, and crop insurance.

Direct cost of corn production in Illinois for 2023 was $579 per acre compared to $269 per acre in Mato Grosso. The average corn yields from 2016 to 2022 in Mato Grosso was 93 bu/ac compared to 224 bu/ac in Illinois. By this measure, the average direct cost of corn production in Illinois averaged $1.98 per bushel compared to $2.24 per bushel in Mato Grosso.

The study concludes "When comparing direct costs on a per bushel of production basis, an average cost advantage exists for central Illinois compared with Mato Grosso since 2016.  This cost advantage is driven by higher per bushel fertilizer costs in Mato Grosso, as well as higher post-harvest costs of drying and storage.  In contrast, both seed and pesticide costs have been much more similar for central Illinois and Mato Grosso over the past nine crop years."

Below are two of the many charts in the study.