BRAZILIAN FARMERS are facing a loss of more than $500m (£269m) this year, after the collapse of soya prices, the Financial Times reports.

The country‘s state agriculture federation (Famato) said that soya farmers would be forced to plant a smaller area later this year, after decades of runaway growth.

Strong demand from China in 2004 pushed prices to $16 (£8.60) per 60kg bag, but this has halved in recent months because of record world oilseed production and rising production costs.

Famato reports the farmer cost per bag of soyabeans has risen to $10.30 (£5.50) on the back of rocketing fertiliser and fuel prices, while transport bottlenecks have hit efficiency.

Some of the most prolific area of agricultural growth and expansion has been in the western Mato Grosso state, which is 1500km from the ports in the east.

Cultivation began in the 1980s and proceeded at break-neck pace in what was described as an agricultural gold rush.

But with prices down, it now looks very unlikely that Brazil will match last year‘s $10bn (£5.4bn) of soya product exports.