Brazil Corn Costs Split as Inflation Hits Competitiveness

Key Moments

Overview of the Comparative Study

Brazil’s rapid growth in corn output over the past decade has significantly intensified competition in the global corn trade, particularly for U.S. producers. While the United States remains the largest corn producer worldwide, Brazil’s expanding role has been driven primarily by the development of a second-crop corn system following soybeans. This double-cropping approach allows Brazilian growers to allocate fixed costs across two crops in the same production year, shaping a cost profile that contrasts with that of U.S. corn farms.

Using standardized economic data from the agribenchmark network, the analysis compares corn production costs and returns for representative farms in Iowa, United States, and Mato Grosso, Brazil, from 2020 through 2024. The comparison highlights structural cost differences and profitability patterns, offering a window into the factors that influence corn competitiveness in both countries.

Data Sources, Farm Profiles, and Scope

The assessment focuses on one typical corn farm in Iowa and one in Mato Grosso, both located in key corn-producing regions in their respective countries. Together, the United States and Brazil represent 43% of global corn production and nearly 60% of global corn exports (USDA, 2026). The study period, 2020-2024, spans two major global shocks: the COVID-19 pandemic and the Russia-Ukraine war.

During this period, the typical Mato Grosso farm planted an average of 5,900 acres of corn annually, compared with 1,800 acres on the Iowa farm. All costs and revenues are denominated in U.S. dollars to permit direct comparison across countries.

The underlying data are drawn from the agribenchmark network, which compiles technical and economic information for beef, cash crops, dairy, pigs, poultry, horticulture, and organic enterprises in 35 countries across North America, South America, Europe, Asia, and Oceania. The agribenchmark concept of typical farms is designed to represent prevailing production systems and structures at the national level. Participants employ standardized procedures to build typical farms that reflect relevant production shares and are classified by production systems, enterprise combinations, and structural features (see farmdoc daily, January 8, 2024).

Cost Structure: Direct, Operating, and Overhead Components

Differences in corn input use and cost structures between the U.S. and Brazilian farms mirror broader variation in technology, input pricing, soil conditions, production efficiency, trade policy, currency movements, labor markets, and local market environments (see farmdoc daily, February 23, 2026). The cost structure is grouped into three main categories: direct costs, operating costs, and overhead costs.

Direct costs encompass seed, plant protection, fertilizer, irrigation, crop insurance, drying, and financing expenses. Operating costs include machinery, hired labor, family labor, contractor services, fuel, and other energy-related expenditures. Overhead costs cover land, building depreciation, repairs and interest, property taxes, insurance, and miscellaneous items.

Brazil: Input-Intensive Direct Cost Model

On the typical Mato Grosso farm, direct costs consistently accounted for more than 50% of total corn production costs in every year from 2020 through 2024. This heavy weighting reflects substantial spending on inputs, particularly fertilizer. Corn relies heavily on nitrogen, and nitrogen prices rose sharply after 2022 following disruptions linked to the Russia-Ukraine conflict. Brazil is also highly dependent on nitrogen imports, which provide nearly 95% of the country’s consumption (see farmdoc daily, April 20, 2026).

Furthermore, nearly 80% of Brazil’s corn output is produced as a second crop in the Cerrado region (Conab, 2026). In this environment, chemical pest control and fertilizer applied to correct soil deficiencies form a substantial share of overall production costs.

United States: Overhead-Heavy Cost Structure

For the typical Iowa farm, overhead costs represented the largest share of total corn production costs in three of the five years analyzed, exceeding one-third of total costs. Rising land values have been a main driver of this pattern, pushing land-related expenses higher in recent years (Purdue University, 2025). The main exceptions were 2022 and 2023, when direct costs surpassed overhead due to exceptionally high fertilizer prices.

Fertilizer costs surged globally from late 2021 through the second quarter of 2022, as supply constraints and the Russia-Ukraine conflict contributed to record fertilizer outlays per acre in many countries. Although operating costs accounted for less than 30% of total costs, they were still higher on the Iowa farm than on the Mato Grosso farm throughout the study period.

Evolution of Production Costs on Typical Farms

Figure 2 compares total corn production costs and gross revenues for the two farms. Across 2020-2024, the Iowa farm consistently exhibited higher total production costs than the Mato Grosso farm.

On the Brazilian farm, total costs more than doubled over the period, rising from $69 per ton in 2020 to $147 per ton in 2024. This sharp escalation was driven mainly by higher direct costs. Increases in international prices for imported fertilizers significantly raised production expenses, and because these inputs are priced in U.S. dollars, the depreciation of the Brazilian real against the dollar further magnified domestic costs.

On the Iowa farm, corn production costs also climbed, though less steeply. From 2020 to 2024, total costs rose 22%, moving from $160 per ton to $195 per ton. Over the same interval, operating costs increased 26%, from $49 per ton in 2020 to $62 per ton in 2024. Since 2021, all major components of operating costs in the United States – hired labor, family labor, contractors, machinery, and diesel – have increased substantially, reflecting supply chain disruptions following the pandemic and broader inflationary pressures (USDA-ERS, 2024).

Revenue Trends and Economic Profitability

Although total production costs increased on both farms during 2020-2024, gross revenues also rose in each country. However, in some years, revenue growth did not fully compensate for cost inflation. Figure 3 shows economic profits for both farms, calculated as gross revenue minus total production costs, including direct, operating, and overhead components.

Economic performance varied over time and between locations. Both farms registered their strongest economic profits in 2022, a period when Chicago corn futures prices were above $6 per bushel. The Iowa farm achieved an economic profit of $60 per ton, while the Mato Grosso farm recorded approximately $45 per ton.

Profitability deteriorated sharply after 2022. In both 2023 and 2024, the two farms experienced negative economic profits, meaning total revenue did not cover total economic costs. The Iowa farm posted losses of $28 per ton in 2023 and $21 per ton in 2024. The Mato Grosso farm also recorded losses, but of a smaller magnitude, at $14 per ton in 2023 and $12 per ton in 2024.