Cropland prices in Brazil doubled from 2019-22, pulled up by high commodity prices and strong investor demand, and aided by low interest rates, said four University of Illinois agricultural economists.
Land in Parana, one of Brazil’s top soybean-producing states, now carries roughly the same valuation as the per-acre average in Illinois, the U.S.’s top soybean producer—$8,417 vs $8,950—the economists wrote at the farmdoc daily blog.
“Although farmland prices have increased all over Brazil, the southern states stand out, with most land prices above the national average,” wrote economists Joana Colussi, Gary Schnitkey, Nick Paulson and Jim Baltz.
In Mato Grosso, the largest soybean and corn producer, land values more than doubled, to $4,475 an acre. In Rio Grande do Sul, another leading soy state, cropland was worth $5,162 an acre.
“The record increases in cropland values in Brazil in recent years are unlikely to be repeated in 2023,” said the farmdoc blog. Corn and soybean prices were falling in Brazil in the face of bumper harvests and high transportation costs. Sales to China have weakened and reduced the premiums being offered at ports for soybeans. Interest rates are on the rise, which will also affect land values.