Good morning, ladies and gentlemen, and thank you for waiting. At this time, we would like to welcome everyone to SLC Agrícola first quarter of 2018 earnings conference call. Today we have with us Mr. Aurélio Pavinato, CEO, and Mr. Ivo Marcon Brum, CFO and Investor Relations Officer. We would like to inform you that this event is being recorded and all participants will be in a listen-only mode during the company's presentation. After the company's remarks are completed, there will be a question- and- answer session. At that time, further instructions will be given.
Should any participant need assistance during this call, please press star zero to reach the operator. Also, today's live webcast, both audio and slideshow, may be accessed through SLC Agrícola website at www.slcagricola.com.br, the investor relations section by clicking on the banner Webcast 1Q 2018. The following presentation is also available to download on the webcast platform. The following information is available in thousands of Brazilian reals and IFRS, except when otherwise indicated. Before proceeding, let me mention that forward-looking statements are based on the beliefs and assumptions of SLC Agrícola management and on information currently available to the company.
They involve risks, uncertainties, and assumptions because they relate to future events and therefore depend on circumstances that may or may not occur in the future. Investors should understand that general economic conditions, industry conditions, and other operating factors could also affect the future results of the company and could cause results to differ materially from those expressed in such forward-looking statements. Now I'll turn the conference over to Mr. Aurélio Pavinato, CEO. Mr. Pavinato, you may proceed.
Good morning. Thank you for participating in SLC Agrícola's earnings conference call for the first quarter of 2018. Let's start, please, on slide three. Soybean yield in 2017-2018 crop year compared to 2016-2017 and average in the last five years. As we commented in the message from management in our earnings release, the results for the first quarter once again are a great source of pride for our company. With the conclusion of the soybean harvest, we set a new record for yield of 3,756 kg per hectare, which is 11.8% above our initial guidance.
As you can see in the chart, our production potential has clearly increased, which reflects the execution of our strategies to capture operating efficiency gains. Let's turn to slide five, cotton price, where we will begin our comments on the recent price variation in our main products and the short-term price outlook. So far in 2018, cotton prices once again have rallied, with the commodity currently trading at around $0.85 per pound in shorter-dated contracts in New York. Weekly U.S. sales have been setting new records, attesting to the strong demand for cotton in 2018.
According to USDA forecasts, global consumption in the current cycle should set a new record, surpassing the mark of 120 million bales, effectively crowning the recovery in cotton demand that has been ongoing since the 2012-2013 crop year. As you can see on slide six, U.S. soil moisture conditions, despite the expectation of an expansion in cotton planted area in the United States in the 2018-2019 crop year, which already is being planted, there are major concerns with soil moisture conditions in Texas, which is the country's leading cotton-producing state. USDA data point to [audio distortion] exceptionally dry conditions, so the planted area could be big.
In the case of soybean, whose price chart you can see on slide seven, soybean price, we also have a scenario of rising prices in these first few months of the year. This current context of price quotes above $10 per bushel in Chicago reflects mainly the sharp shortfall in Argentina due to the country's severe drought. Soybean production volume in Argentina, which should come in 30% below the initial forecast, is currently estimated at 38 million tons, which represents a shortfall of 16 million tons.
In the United States for the 2018-2019 crop year, the USDA, through its first report of planting intentions for 2018, projected a reduction in the soybean planted area of 1% compared to the previous crop year, both in the rest of the market, which estimated expansion of around 2%. Corn prices, which you can see on slide eight, corn price Chicago and ESALQ, also had a rising in Chicago in recent months.
The main factors influence this upward trend in prices are also the drought in Argentina, which reduced the country's output by nearly 10 million tons, and the expectation of a reduction in planted area in the United States in the crop year, which is corroborated by the USDA, which estimated a reduction of 2 million acres.
In the domestic market, corn prices are once again decoupled from export parity, giving the combination of a reduction in planted area for first crop corn in Brazil and a success export program during 2017, when the country exported 29.2 million tons, according to SECEX. I will now pass the call over to my colleague, Ivo Brum, our CFO and IRO, who will comment on our financial results in the period.
Good morning, everyone. Let's move to slide 10, which presents the highlights from our income statement in the period. The net revenue advanced 21% on the first quarter of 2017, basically due to the higher volume of the crop invoiced, given the crops better prices in the first quarter of the year. Another important factor was the determination of the fair value of the biological assets of [audio distortion] which reflects the gross margin expectation for the soybean crop, already incorporating the excellent yield activities.
EBITDA in the quarter grew 22% year-over-year to BRL 150 million, with margin of 35%. EBITDA growth also was driven primarily by the higher volume of the crop invoiced in the quarter, combined with higher price and lower unit cost. Net income, which came to BRL 169 million, was supported by the higher operating income and lower financial expenses. Both EBITDA and net income set new records for the first quarter.
As you can see on slide 11, the period marked another quarter of positive free cash flow, which came to BRL 22 million. Part of this cash generation was used to close the share repurchase program announced in 2017 of 2 million shares, which was concluded in March. As a result, net debt is still at very comfortable level of 1.14x EBITDA in the last 12 months. I will now pass the call back for Pavinato , who will comment on the outlook for the rest of the year.
Thank you, Ivo. Let's move on to slide 13, table cost per hectare 2017-2018 compared with actual cost 2016 and 2017. In this slide, you can see the cost per hectare of the current crop year, which are stable in comparison with the previous crop year. The outlook for the cotton and corn crop is also very positive. Cotton is already in the final stage of the cycle, with fields presenting excellent potential yields, with output expected to support the initial forecast. The corn crop also is well established and presenting good vegetative development, having enjoyed favorable weather conditions to date.
Furthermore, as you can see on slide 14, table with prices hedged in reals per pound for cotton and reals per bushel for soybean 2018 versus 2017, we have prices hedged for the year at levels similar to those obtained in 2017. The average price of the balance for sale could still improve, given the recovery in prices in recent months and the weaker Brazilian real. This leads us to conclude that margins for this year should remain at high levels. Thank you. Let's now open the call for questions.
Ladies and gentlemen, thank you for. If you would like to ask a question, please dial star one. If at any point your question is answered, you may remove your question from the queue by pressing the pound key. Thank you. This just concludes today's presentation. You may disconnect your line at this time, and have a nice day.