Although the cost of production rose in both countries in 2023, U.S. corn growers have an advantage over their Brazilian rivals with lower per-bushel costs, said four agricultural economists at the farmdoc daily blog. The United States grows three times as much corn as Brazil, but Brazil is forecast to be the world’s top corn exporter for the second year in a row.
U.S. yields per acre are much higher than in Brazil, and that helps defray direct production costs that include fertilizer, seed, pesticides, storage, drying, and crop insurance. Direct costs average $1.96 a bushel in central Illinois and $2.24 a bushel in Mato Grosso, two high-volume corn-producing regions. On a per-acre basis, costs are lower in Brazil. Fertilizer, drying, and storage costs are higher in Brazil.
Direct costs have been on the rise in both regions since 2016. They were the highest ever for Mato Grosso in 2022/23, though a decline is expected in the 2023/24 growing year, “which is also in line with cost projections for Illinois,” wrote agricultural economists Joana Colussi, Nick Paulson, and Gary Schnitkey of the University of Illinois and Carl Zulauf of Ohio State University.
The USDA recently said that Brazil had improved its export competitiveness with the United States over the past decade by paving roads, building rail lines, and opening export terminals. Brazil is forecast to export more than twice the volume of soybeans as the United States during the current trade year — 99.5 million metric tons vs. 47.8 million metric tons.