Risk and return of soybeans precision production: a case study in Mato Grosso do Sul state, Brazil1

Mateus Pereira Lavorato, Marcelo José Braga


Precision agriculture (PA) has not yet spread in Brazil, despite the benefits stressed in literature. Considering the uncertainty related to PA’s results, this study evaluated the tradeoff between risks and returns for precision production of soybeans in Mato Grosso do Sul state, Brazil. A representative farm using PA was compared to a conventional production system through the Earnings-at-Risk metric and a Modified Sharpe Index. PA presented higher expected earnings per hectare while conventional production proved to have a lower risk exposure. The positive difference in expected earnings between precision and conventional systems was insufficient to cover PA’s risk exposure, leading to the conclusion that less risk-averse farmers could assume higher risks and prefer precision system.


risks; returns; precision agriculture; soybeans; Brazil

Full Text:


DOI: http://dx.doi.org/10.13128/REA-23577

  Creative Commons License

This work is licensed under a Creative Commons Attribution 4.0 International License (CC-BY- 4.0)

Firenze University Press
Via Cittadella, 7 - 50144 Firenze
Tel. (0039) 055 2757700 Fax (0039) 055 2757712
E-mail: info@fupress.com