Soybean Production in Brazil: Main Determinants of Property Sizes

Abstract

Economies of scale are present in soybean production. In Brazil, the two largest producing regions have properties with different dimensions. In particular, the average size of properties in the South is much smaller than those in the country´s Mid

West region. This study analyzes the characteristics that favor smallscale soybean producing properties in the country’s Southern region. Its theoretical framework is based on the Neoclassical theory and in Transaction Cost Economics. Questionnaires were applied to producers from the State of Rio Grande do Sul. A regression analysis shows the relation between the selected factors and property size. Results show that a greater use of labor, particularly of family employees, and the greater diversity of crops contribute to explain the existence of small soybean properties in South Brazil.