RIO DE JANEIRO, BRAZIL – Fears of fertilizer shortages are almost entirely slowing soybean expansion in Brazil, the world’s largest exporter.
According to a forecast by Itaú BBA (ITUBN), oilseed acreage is expected to increase by only 0.5% in the coming 2022-23 season, the slowest growth since 2006.
A slowdown in the world’s largest soybean producer, which feeds a large share of the world’s farmed animals, could contribute to global food inflation.
According to Guilherme Bellotti, an analyst at Itaú BBA, Brazilian farmers are unsettled this season because of rising production costs and concerns about fertilizer shortages.
Russia is Brazil’s leading fertilizer supplier, and the war in Ukraine raises fears of a disruption in crop nutrient supplies. Brazil imports 85% of its fertilizer.
Brazilian farmers’ profit margins could drop by a third to 40% this year because of rising costs, Bellotti told reporters Tuesday. “It’s still a good margin,” he added.
Preliminary estimates suggest the Brazilian crop could still rise 15% from last year to 141 million tons as fertilizer residues in the soil from past seasons reduce the impact of lower current applications, Bellotti said.