September 8, 2014

In less than four years land buyers in Brazil’s north east region have doubled their money, however, there are indicators that the market is slowing.  A valuation of BrasilAgro’s land portfolio conducted by Deloitte Touche Tomatsu set a value of R$1.29 billion at the end of June – up 60% from the previous valuation completed at the end of 2010.  But as grain prices fall below cost of production, BasilAgro is seeing land appreciation slowing for all but one of its farms over the past year to June.  Despite crashing prices, crop production in the Mapitoba region of the country is particularly strong with grain output up 42% in Bahia year on year to 7.61 tons of grain, and output in Piaui up 73% to 2.78 tons.  Brazil’s total national grain output this year is 193.5 million tons – up 2.6% according to the country’s crop estimating agency Conab.  For the April –June quarter, the fourth quarter for BrasilAgro, the group reported a loss of R$6.55 million compared with R$19.2 million for the same quarter a year before because of a 35% drop in net sales due to lower volumes in crop sales and lower earnings from farm sales.

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