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October 3, 2019

Conventional Soybeans (non-GMO) Losing Ground in Mato Grosso

Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.

The state of Mato Grosso is the only major soybean producing state in Brazil where farmers still produce a significant amount of conventional soybeans (non-GMO), but conventional soybeans continue to lose ground in the state.

Conventional soybeans command a premium in the international marketplace, but they are also more expensive to produce. Conventional soybeans need to avoid contamination from GMO varieties and according to the Soybean Free Institute of Brazil, it costs approximately 3% more to produce those soybeans due to additional management, transportation, and storage costs.

For two years in a row, the amount of conventional soybeans grown in Mato Grosso has been on the decline. During the 2017/18 growing season, approximately 18% of the soybeans grown in Mato Grosso were conventional varieties. During the 2018/19 growing season, that declined to 12%. The acreage is expected to decline again in 2019/20 by approximately 25%. If verified, conventional soybeans would be planted on 873,000 hectares in 2019/20, which would be down 290,000 hectares from last year. The decline is being attributed to diminishing premiums for conventional soybeans.

The reason why conventional soybeans can be grown in Mato Grosso is because soybeans grown in the western part of the state are exported out of the port of Porto Velho on the Madeira River in the state of Rondonia. Some of the facilities at that port have been dedicated to handle only conventional soybeans in order to avoid contamination. This is the only port in Brazil with this distinction. Therefore, any conventional soybeans exported out of any other port in Brazil would be contaminated with GMO soybeans.