Brazilian Agribusiness Q1 2026: The Hedge Book Cycle

Brazilian agribusiness integrator 3tentos (B3: TTEN3), the leading vertically integrated agricultural-inputs-to-grains-to-industry platform in Brazil’s south and centre-west grain belt, reported Q1 2026 net income of R$85.2 million ($16.9 million) — down 55.7 percent year-on-year on hedge-accounting effects, according to the earnings release published Wednesday May 13.

The 3tentos Q1 earnings tell a striking divergence story. Excluding hedge effects, adjusted net income reached R$230.9 million ($45.7 million) — up 110.7 percent year-on-year. Adjusted net margin expanded from 3.1 percent in Q1 2025 to 5.5 percent in Q1 2026. The reported net margin fell from 5.5 percent to 2.0 percent, but the underlying operational profitability roughly doubled in real terms.

Net revenue reached R$4.21 billion ($834 million), up 20.2 percent year-on-year. Gross profit grew 27.3 percent to R$651.1 million ($128.9 million), with gross margin expanding 0.9 percentage points to 15.5 percent. The adjusted gross profit (including hedge adjustments) reached R$906.6 million ($179.5 million), up 66.3 percent year-on-year — with adjusted gross margin jumping from 15.6 percent to 21.6 percent.

EBITDA was R$138.7 million ($27.5 million), down 15.8 percent year-on-year with margin compressing from 4.7 percent to 3.3 percent on reported basis. The adjusted EBITDA including hedge effects nearly doubled to R$394.3 million ($78.1 million), up 98.5 percent — and adjusted EBITDA margin expanded from 5.7 percent to 9.4 percent. CEO and founder João Marcelo Dumoncel framed the results: “The geographic diversification combined with the verticalisation of our business model continues to contribute to our growth trajectory.”

Key Points

What 3tentos Reported in Q1 2026

3tentos Agroindustrial, listed on B3 as TTEN3, is Brazil’s largest vertically integrated agribusiness platform combining agricultural inputs distribution (seeds, fertilizers, crop-protection products), grain origination and trading, and industrial processing (soybean crushing, biodiesel, corn ethanol). Founded in 1995 in Santa Bárbara do Sul, Rio Grande do Sul, by the Dumoncel family — initially as a wheat-seed distributor — the company now operates 73 retail stores across Rio Grande do Sul and Mato Grosso plus three industrial parks.

The company went public in July 2021 in a B3 Novo Mercado listing raising R$1.89 billion ($375 million at the time) at R$12.75 ($2.53) per share, as the Rio Times reported at the time. CEO and founder João Marcelo Dumoncel leads operations, with father Luiz Osório Dumoncel remaining a central reference figure. The Dumoncel family controls the company through a long-term shareholder structure.

Q1 2026 net income reached R$85.2 million ($16.9 million), down 55.7 percent from R$192.4 million ($38.1 million) in Q1 2025. The decline is almost entirely hedge-accounting-driven: under IFRS, the company books the mark-to-market changes of commodity hedges through profit and loss, creating significant quarterly volatility that does not reflect cash earnings on hedged volumes.

Excluding hedge effects, adjusted net income reached R$230.9 million ($45.7 million), up 110.7 percent year-on-year. Adjusted net margin expanded from 3.1 percent to 5.5 percent — a structural improvement. The 230.9 / 85.2 divergence (R$145.7 million / $28.9 million difference) represents the timing mismatch between the realisation of hedged commodity prices and the IFRS accounting recognition.

Net revenue grew 20.2 percent year-on-year to R$4.21 billion ($834 million). This represents the 29th consecutive quarter of revenue expansion at 3tentos — a multi-year operational track record reflecting the company’s strategic integrated-model positioning. Insumos (agricultural inputs), grãos (grain trading) and indústria (industrial processing) all contributed to the top-line growth.

Gross profit reached R$651.1 million ($128.9 million), up 27.3 percent year-on-year. Gross margin expanded 0.9 percentage points to 15.5 percent. The adjusted gross profit (including hedge adjustments) reached R$906.6 million ($179.5 million), up 66.3 percent year-on-year. Adjusted gross margin jumped from 15.6 percent in Q1 2025 to 21.6 percent in Q1 2026 — a 600-basis-point structural expansion reflecting both pricing tailwind and operational scale.

Reported EBITDA was R$138.7 million ($27.5 million), down 15.8 percent year-on-year. The reported EBITDA margin compressed from 4.7 percent to 3.3 percent. The hedge-adjusted EBITDA tells the opposite story: R$394.3 million ($78.1 million), up 98.5 percent year-on-year, with adjusted margin expanding from 5.7 percent to 9.4 percent — a 370-basis-point operational improvement.

The hedge-protection framework was the central operational lever. BTG Pactual analysis on the Q3 2025 print had highlighted that “without the price-lock, the margin per ton would have collapsed 56 percent versus Q2 2025, reaching the lowest USD level since 2019.” The same dynamic applies in Q1 2026 — hedging shifted operational profitability from cyclically depressed spot pricing toward locked-in higher pricing established earlier.

CEO Dumoncel framed the strategic positioning: “The geographic diversification combined with the verticalisation of our business model continues to contribute to our growth trajectory. The strong pace of investments made in recent quarters is starting to deliver results, particularly in the industry segment.”

The industry-segment inflection is the structural narrative. As the Rio Times reported in June 2025, 3tentos launched a R$2.12 billion ($420 million) investment plan through 2030 focused on biofuel production, logistics infrastructure, and cattle-productivity-supporting feed production.

More than half of this capex — R$1.04 billion ($206 million) — funds a corn ethanol plant in Porto Alegre do Norte, Mato Grosso, processing 935,000 litres of ethanol daily plus 587 metric tons of dried distillers’ grain and 37 tons of corn oil. Operations launched early 2026.

Logistics infrastructure investment runs in parallel. 3tentos committed R$200 million ($39.6 million) through a partnership with Caramuru Alimentos to build a river transshipment terminal in Itaituba, Pará, and a port terminal in Santana, Amapá. These facilities target Brazil’s northern export corridor — strategically important as soybean and corn export volumes shift from Santos toward the Amazon basin.

XP Investimentos updated its 3tentos model in late April 2026, maintaining the company as their top pick in agribusiness. The new price target is R$21.60 ($4.28) by end-2026, revised down from R$23.60 ($4.67) on more cautious logistics-expense assumptions. The XP pre-print framework expected Q1 net revenue around R$4.0 billion ($792 million) up 16 percent year-on-year with insumos growth of 33 percent — meaning the reported Q1 revenue beat XP’s pre-print expectation by approximately 5 percent.

The Carbon Seal Program is the sustainability differentiator. 3tentos now covers 400 farms and over 255,000 hectares under the program — measuring and certifying sustainability practices across the company’s value chain. This positions 3tentos for European Union deforestation-regulation (EUDR) compliance and other sustainability-mandated trade frameworks.

The 2030 ambition is the long-cycle anchor. 3tentos has publicly stated a target of R$50 billion ($9.9 billion) in net revenue by 2030 — implying roughly 25-30 percent annualised revenue growth from the current run-rate. The capex plan supporting this ambition is funded through operational cash generation plus selective debt; the company has maintained investment-grade-style credit metrics through the heavy investment cycle.

Why 3tentos Q1 Matters

3tentos is the cleanest single listed proxy for the integrated Brazilian agribusiness value chain — combining input distribution, grain trading, and industrial processing in one verticalised platform. The Q1 print exposes two critically important dynamics: the volatility of hedge-accounting under Brazilian IFRS interpretation, and the structural margin expansion the company is delivering through operational scale and capex monetisation.

The hedge-accounting divergence is the analytical headline. The 155-percentage-point swing between reported (-55.7 percent) and adjusted (+110.7 percent) net income reflects how IFRS mark-to-market treatment can fundamentally misrepresent operational performance during periods of commodity-price volatility. For 3tentos specifically, the company’s hedge book successfully locked in higher pricing established before commodity correction — meaning Q1 2026 represents the *realisation* of pricing decisions made during prior periods of stronger spot levels.

The industry-segment inflection is the structural story. As the Rio Times analysed in February 2025, 3tentos closed 2024 with the highest ROIC since its IPO at 24.7 percent — driven by the industrial segment’s 43.9 percent revenue growth on soybean crushing and biodiesel production. The 2025-2026 capex cycle (R$1.7 billion / $337 million in 2025 alone) targets sustained expansion of this highest-return segment.

The Iran-Hormuz cluster pairing creates a critical analytical context. The Rio Times’ coverage of SLC Agrícola’s Q1 print earlier this week framed 3tentos within the agribusiness Iran-Hormuz exposure cluster: “Hormuz fertilizer risk” — given the potential 1-3 million tonne phosphate deficit Brazilian agriculture faces from continued Hormuz disruption. 3tentos’s input-distribution business directly transmits fertilizer-cost dynamics to farmer customers.

However, the hedge framework partially insulates 3tentos from the spot-price volatility. The company’s integrated model — purchasing inputs at one cycle, selling outputs at the next — creates natural hedge opportunities that pure-farmer operators like SLC Agrícola cannot fully replicate.

The 23.3 percent EBITDA margin reported in Q1 2024 had collapsed to 4.7 percent in Q1 2025 reported; Q1 2026 reported margin at 3.3 percent shows ongoing cyclical pressure on reported numbers, but the 9.4 percent adjusted margin shows underlying operational health.

The corn ethanol launch is the medium-term operational catalyst. As the Rio Times reported on the 2030 investment plan, the new Mato Grosso ethanol plant processes 935,000 litres of ethanol daily — exposing 3tentos to Brazil’s biofuel-cycle dynamics through 2026-2028 as the federal government progressively raises biofuel mandates. The Brent crude rally to peaks of $128 per barrel during the Iran shock provided structural tailwind to ethanol pricing globally.

The 2030 ambition is structurally ambitious but operationally backed. R$50 billion ($9.9 billion) revenue by 2030 implies roughly 25-30 percent annualised growth from the current $4.21 billion run-rate. While ambitious, the company has delivered 29 consecutive quarters of revenue expansion — and the integrated model creates compounding cross-segment revenue opportunities as input customers convert to grain origination clients and grain-trading customers tap into industrial-feed offtake.

XP Investimentos’ maintenance of 3tentos as their top pick in agribusiness despite the price-target reduction reflects the structural thesis intact. The PT cut from R$23.60 ($4.67) to R$21.60 ($4.28) on logistics-cost assumptions is a calibration adjustment, not a thesis change. P/E of 10x 2026 falling to 7.6x 2027 implies meaningful EPS growth still ahead even at consensus expectations.

Competitive context matters. 3tentos competes against international agribusiness giants — Cargill, ADM, Bunge — operating in Brazil at much larger scale, plus listed peers BrasilAgro (AGRO3) in farmland, SLC Agrícola (SLCE3) in pure-grain production, and Boa Safra (SOJA3) in soybean seeds specifically. The 3tentos integrated model is structurally differentiated: no single listed Brazilian peer combines inputs, grains and industry at this scale.

CEO Dumoncel’s commentary on the Brazilian agribusiness cycle has been consistent. As the Rio Times reported in September 2024, Dumoncel noted that “global oversupply of soybeans is already being priced in, but we will face logistical problems, especially for a harvest estimated at 165-170 million tons of soybeans, plus more than 130 million tons of corn in Brazil.” The logistics-investment programme directly addresses this structural-shortage observation.

The Carbon Seal Program positions 3tentos for the European Union’s deforestation-regulation (EUDR) compliance and similar emerging sustainability frameworks. Covering 400 farms and 255,000 hectares, the certification programme creates a value-add layer that supports premium pricing into sustainability-mandated trade channels — a structural moat as global trade increasingly conditions on environmental compliance.

For foreign investors, 3tentos does not currently trade through a US ADR programme — direct exposure requires B3 access. The company offers a differentiated agribusiness exposure: integrated value chain, hedge-protected operational margins, biofuel cycle exposure through corn ethanol, and sustainability-led trade positioning. Combined with the XP Investimentos top-pick framework and the favorable P/E trajectory (10x 2026E to 7.6x 2027E), 3tentos represents one of the most editorially structured Brazilian agribusiness equity stories available.

Sell-Side View

Sell-side consensus on 3tentos is broadly constructive with the hedge-book framework as the central analytical anchor. XP’s top-pick designation and BTG’s repeated highlighting of hedge protection as the key operational lever frame the company as a quality-premium agribusiness exposure trading at multiples below intrinsic value. The Q1 print broadly validates this framework.

Financial Snapshot Q1 2026

Strategic Positioning and Capex

Peer Benchmark — Brazilian Listed Agribusiness

What Happens Next for 3tentos

Q2 hedge-book roll: Q1 hedges protected operational profitability against spot weakness. Q2 print will reveal how the next layer of the hedge book — likely covering current quarter at different price points — translates into operational margins.

MT corn ethanol ramp: The Porto Alegre do Norte facility began operations in early 2026. Q2-Q3 prints will start showing meaningful ethanol-segment revenue contribution. Watch the indústria-segment growth rate.

Logistics infrastructure delivery: The R$200 million ($39.6 million) Itaituba/Santana terminal investments must deliver to support 2027-2028 growth. Construction milestones become critical analyst data points.

Fertilizer-cost test: The Hormuz disruption’s transmission into Brazilian phosphate pricing remains the key 2026/27 input-segment risk. Watch insumos gross margin trajectory closely.

XP Q2 thesis review: XP’s top-pick designation depends on continued operational delivery. The April PT cut from R$23.60 ($4.67) to R$21.60 ($4.28) signals analyst sensitivity to logistics-cost trajectory — Q2 logistics-line disclosure will inform any further model revisions.

Frequently Asked Questions

How much did 3tentos earn in Q1 2026?

3tentos reported Q1 2026 net income of R$85.2 million ($16.9 million), down 55.7 percent from R$192.4 million ($38.1 million) in Q1 2025. The reported net margin compressed from 5.5 percent to 2.0 percent. However, excluding hedge effects, adjusted net income reached R$230.9 million ($45.7 million), up 110.7 percent year-on-year — with adjusted net margin expanding from 3.1 percent to 5.5 percent.

Net revenue grew 20.2 percent year-on-year to R$4.21 billion ($834 million) — the 29th consecutive quarter of revenue expansion. Adjusted EBITDA nearly doubled to R$394.3 million ($78.1 million), up 98.5 percent. Adjusted EBITDA margin expanded from 5.7 percent to 9.4 percent. The reported EBITDA was R$138.7 million ($27.5 million), down 15.8 percent.

Why did reported profit fall 55.7 percent while adjusted profit doubled?

The divergence reflects hedge-accounting treatment under IFRS. 3tentos uses commodity hedges to lock in selling prices for grain and industrial outputs and to manage input-cost volatility. Under IFRS, the mark-to-market value changes of these hedges flow through profit and loss in each reporting period, creating significant accounting volatility that does not reflect the cash earnings on hedged volumes.

In Q1 2026, the hedge book locked in higher pricing established before the recent commodity correction, meaning the operational realisation of hedged contracts was more profitable than reported figures suggest.

As BTG Pactual highlighted in its Q3 2025 analysis, “without the price-lock, the margin per ton would have collapsed 56 percent versus Q2 2025, reaching the lowest USD level since 2019” — the same dynamic protects Q1 2026. The R$145.7 million ($28.9 million) gap between reported and adjusted net income reflects this timing mismatch.

What is 3tentos’s strategy and 2030 ambition?

3tentos has publicly stated a target of R$50 billion ($9.9 billion) in net revenue by 2030 — implying roughly 25-30 percent annualised growth from the current run-rate. The company’s strategy is built on three integrated pillars: agricultural inputs distribution through 73 retail stores in Rio Grande do Sul and Mato Grosso; grain origination, storage and trading; and industrial processing through soybean crushing, biodiesel production, and corn ethanol.

The R$2.12 billion ($420 million) investment plan through 2030 includes a new corn ethanol plant in Porto Alegre do Norte, Mato Grosso (R$1.04 billion / $206 million, operational since early 2026, processing 935,000 litres daily), plus R$200 million ($39.6 million) in logistics infrastructure partnerships with Caramuru Alimentos for terminals in Itaituba (Pará) and Santana (Amapá). The Carbon Seal Program covering 400 farms and 255,000 hectares positions the company for European Union deforestation-regulation compliance.

How does the Iran-Hormuz shock affect 3tentos?

The Iran-Hormuz disruption is a two-sided dynamic for 3tentos. On the positive side, the global biofuel-demand boost from elevated oil pricing supports the company’s corn ethanol and biodiesel segments — Brent crude reached an intraday peak of $128 per barrel in March 2026, structurally supporting ethanol pricing. The integrated business model creates internal hedge opportunities between inputs and outputs.

On the negative side, the Hormuz disruption threatens Brazilian phosphate supply with potential deficit of 1-3 million tonnes through 2026/27 planting season. As 3tentos distributes fertilizers and crop-protection products through its insumos retail network, fertilizer-cost increases transmit directly through the company’s input segment margins.

The Q1 print does not yet reflect the full Hormuz transmission — Q2 and Q3 will reveal how the company manages this dynamic. 3tentos does not currently trade through a US ADR programme; foreign investors access via B3 direct or Brazilian agribusiness fund vehicles.

Updated: 2026-05-14T07:30:00-03:00 by Rio Times Editorial Desk

3tentos Q1 2026 | TTEN3 earnings | Brazil agro integrator | João Marcelo Dumoncel | hedge accounting | corn ethanol | Iran Hormuz fertilizer cluster | XP top pick | The Rio Times