Soybean Expansion in Brazil’s New Agricultural Frontier: Barter, Production Costs, Price Volatility, and Socio-Economic Impacts in Pará

Abstract

Despite the global relevance of soybean production and Brazil’s leadership in this sector, most studies have focused on established producing regions such as south-central Brazil, while little attention has been given to new frontiers. In particular, the role of barter, costs, price volatility, and local socio-economic aspects remain underexplored. Therefore, this study analyses production costs, market volatility, barter ratio, and the socio-economic impacts of soybean cultivation in the Paragominas Pole in Pará, a Brazilian state, between the crop seasons 2018/2019 and 2024/2025. This research was founded on a descriptive/explanatory case study with quantitative analysis, using statistical data, market reports, and a survey with 36 farmers. We evaluate how barter arrangements are affected by internal and external factors that go beyond the reach of farmers due to their integration into global supply chains. Results highlight that international shocks such as the COVID-19 pandemic and the Russia–Ukraine war significantly increased input and output price volatility, with fertiliser costs being the main driver (hotspot). Notwithstanding, in 2021/2022 onwards, despite the soybean price increasing, a substantial increase in input prices and the barter ratio were also noted, with the highest peak observed in the 2022/2023 harvest (28.35 bags/ha, input costs = US$ 884.52/ha, and soy bag price = US$ 31.2). Soybean production directly employs one person for every 121.8 ha. Half of the area is land leased, and 53% of the surface is cultivated with some kind of off-season crop. We suggest that soybeans producers make their barter with some hedge against falling soybean prices by taking up a position in the Chicago Board of Trade (CBOT), seeking to protect against volatility and fluctuations in the market.