Agricultural production costs in Rio Grande do Sul rise 4.90% in the first four months.

Farmers in Rio Grande do Sul face a double challenge in 2026. While production costs continue to rise, the prices received for production have not yet recovered from the levels of a year ago. The data comes from the monthly report on the Inflation Indices of Agribusiness in Rio Grande do Sul, released by Farsul's Economic Advisory on Tuesday (2). The Production Cost Inflation Index (IICP) registered an increase of 1.55% in April, accumulating 4.90% in the year and 2.37% in the last 12 months. The main offender of the month was fertilizer, which became 8% more expensive in April, pressured by uncertainties in the international input market and the appreciation of raw materials used in its manufacture. The movement of agricultural pesticides was in the opposite direction. The 4% increase in the dollar during the period contributed to reducing their prices, partially relieving the pressure on the total cost. Even so, the overall result was in positive territory, that is, more expensive for the producer. "The rise in costs continues, although at a lower intensity than observed in March," the report states. Over the past 12 months, the IICP accelerated to 2.37%, reinforcing the upward trend that replaced the period of deflation recorded throughout 2025.

Prices received are rising, but are still in the negative.

On the revenue side, the scenario is one of partial recovery. The Price Inflation Index Received (IIPR) rose 0.81% in April, driven by the appreciation of milk, rice, wheat, and beef cattle. However, the accumulated figure over 12 months remains significantly negative -9.19%, which means that, despite the recent improvement, producers still receive less today than they did a year ago for the same product. Rice and milk continue to be pressured by lower supply, while wheat shows the typical increase during the off-season. Beef cattle, in turn, reflects the turning point in the livestock cycle, which historically begins to favor producer prices after periods of intense slaughter. One of the highlights of the report is the contrast between what the producer receives and what the consumer pays on supermarket shelves. While the IIPR accumulates -9.19% over 12 months, the IPCA Food and Beverages, an index that measures food inflation for the final consumer, accumulates an increase of 2.69% in the same period. The overall IPCA (Brazilian consumer price index) is at 4.39%. The numbers highlight a significant disconnect between the field and the table, demonstrating that food inflation does not originate with the rural producer, but in the subsequent stages of the production chain – transportation, processing, distribution, and retail – in addition to broader macroeconomic dynamics such as exchange rates and interest rates. The phenomenon is not new, but the data from April 2026 make it more visible: those who produce receive less than a year ago; those who consume pay more. 

This text was translated by machine from Brazilian Portuguese.