News

Study shows Brazil’s cost advantage could continue to impact U.S. export competitiveness

A new study from Purdue University shows Brazil’s competitive advantage in soybean production isn’t expected to slow down anytime soon.

Joana Colussi says the country has a lower cost of production compared to the U.S.

“Brazil’s structure is heavily impacted by heavy tropical agriculture and a dependence on imported fertilizers,” she says. “Continued crop expansion and increased structure improvements could reinforce their cost advantage.”

But, she tells Brownfield with China becoming the country’s number one export market, “The prices are going down in Brazil due to the demand,” she says. “They don’t have the storage capacity, so everyone is selling their soybeans at the same time and the result is added pressure on prices.”

Colussi says U.S. farmers should focus on working to increase productivity and developing new cost management strategies.

AUDIO: Joana Colussi, Purdue University