Eduardo Godoi, who plants 3,400 hectares of soy in Mato Grosso state, said he prefers to buy inputs in advance. But this year he postponed purchases due to next crop's potentially lower margins. "One is afraid of incurring costs without a guaranteed income," he told Reuters. "Forward sales for the next harvest are advancing timidly," Godoi said. Mato Grosso soy planting should start in the next few weeks, rains permitting, while the new summer corn has begun in Brazil's South. Yet until September 8, farmers had planted only 4 percent of the summer corn area in the South, half of last season at the same time, Nogueira said.
Lack of capital has hampered planning and the ability of farmers to keep current on bills, said Marcos da Rosa, adding that some cash-strapped producers are behind on payments to seed suppliers. "This is a year of full warehouses and empty pockets," he said. Lower grain prices have also affected the fertilizer market as now farmers need more grains to exchange for the same quantity of soil nutrient products, said Fabio Rezende, analyst at INTL FCStone.
In soy's case, producers need 12.6 bags of the oilseeds to buy one tonne of the KCl type fertilizer at Paranagua port, 65 percent more than at this time in 2016. As such, there is a tendency to reduce fertilizer use in the next crop, Rezende said. Fertilizers account for about 22 percent of Mato Grosso soy farmers' operating costs, says research agency Imea, and 70 percent is imported. After a spike in soy prices that revived grain trading in July, fertilizer deliveries for the next crop picked up in August.
Still, fertilizer sales for the winter corn, planted as a rotation crop after soy, fell behind. While last season most winter corn fertilizer deliveries occurred at the end of 2016, this crop season they are forecast to happen only at the start of 2018, according to INTL FCStone.
Copyright Reuters, 2017