The modernization of the productive system and the development of new technologies in agriculture over the last decades have been leading Brazilian producers to use available technologies, mainly those related to genetic modifications in seeds. As a result, considering producers as the weak link of the chain, dependent on technologies, did market research lead producers to the right economic decisions?
Taking into account a typical farm in the west of Paraná state and 2007/08 and 2016/17 crops, it can be observed that certain choices inside the farm – such as planting only soybean in the first season, area increases in the second season and the use of genetically modified seeds – resulted in an increase in the profitability.
The period mentioned was characterized by the change from the low use of genetically modified seeds to a scenario of great dependency on them and to the significant change of area and the allocation of crops in Brazilian farms.
From 2007/08 to 2016/17, the typical producer in the west of Paraná stopped sowing the first corn crop, planting the entire area with first soybean crop. Moreover, these farmers started to occupy the area available in the second crop mainly with corn; however, the wheat crop continued to be planted in all seasons, even at lower area percentage.
The use of more area with corn in the second season, in turn, was possible because of the anticipation of the soybean planting in the first crop and to the reduction of the cycles of soybean varieties. This scenario allowed the corn planting to take place in advance, in the ideal sowing period, reducing risks of the second crop.
Moreover, better results obtained by producers were also linked to the area increase for soybean in the summer (which brings more financial return than corn) and to productivity increase. In many cases, the higher revenue in the first crop influenced to balance or offset negative second crop net revenues.
However, producers were not able to obtain total revenue higher than total production costs in the entire period analyzed; in other words, the capital invested did not remunerate as expected. In spite of that, the net return (gross revenue less total production costs) in recent periods (2014/15 until 2016/17) was higher than initial periods (2007/08 until 2009/10). This fact indicates that producers had taken good decisions on choosing technologies during seasons.
However, there are still many questions to be answered, such as the form of financing and how legal changes may affect results obtained throughout crops. Besides, restarting traditional techniques may not seem to be easy for the Brazilian grains producer.