Shares in BrasilAgro set course for their lowest close since August after the Brazilian cotton-to-sugar farmer reported a second successive quarter in the red, dented by rising costs.

The company, in which Argentina agribusiness giant Cresud is the biggest shareholder, reported an after tax loss of R$816m for the first three months of 2010.

While revenues from crop sales grew by 17% to R$12.3m, crop costs jumped by 55% to R$11.3bn, with higher administrative expenses also eating profits.

Furthermore, the company said its total sowings for 2009-10 had fallen more than 2m hectares short of a target of 48.2m hectares thanks to the delays in winning licences for a 24,200-hectare farm in eastern Brazil.

Development programmes 

The group revealed it had drawn a further R$25.3m in financing from Banco do Nordeste do Brasil for a development programme which included the completion of a 72,000-tonne silo at Cremaq farm, also in the east of the country.

"Part of the soybean [crop] produced in the current harvest year is already stored in the silo," BrasilAgro said.

The group spent R$37.0m buying an 8,600-hectare farm in Maranhao state, bringing the total area under its control to 174,840 hectares, of which 129,780 is for arable use.

BrasilAgro shares stood 5.3% lower at R$8.05 in afternoon trade in Sao Paolo.