Apr 15, 2016

Paraguay Farmers Pleased with Soybean Yields, but not Prices

Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.

Farmers in Paraguay are very pleased with their summer crop and safrinha crop yields, but they are not pleased with the drop in commodity prices. Unlike their Brazilian counterparts, farmers in Paraguay have not benefited from a significant devaluation of their currency, which generally support domestic prices.

Paraguay does not have a soybean-free period like there is in Brazil, so farmers are free to plant soybeans as soon as the spring weather permits and they are also allowed to plant a second crop of soybeans if they choose.

According to a report in Gazeta do Povo, the spring weather was good for planting late last year and many farmers managed to plant all their soybeans before the end of September. These early planted soybeans were the best yielding and they encountered less disease pressure requiring less chemical applications. Yields of the early planted soybeans were very good in the mid-50 bushel range, which surpassed last year's yields.

For the two prior growing season, farmers in Paraguay eagerly embraced planting a safrinha crop of soybeans, but the enthusiasm for a second crop of soybeans faded a little in 2015/16 as farmers opted for more safrinha corn instead. In recent years, as much as 30% to 40% of the first crop soybeans were followed by a second crop of soybeans. Farmers opted for more corn this year due to the higher prices for corn compared to soybeans and the fact that safrinha soybean yields are generally lower than the first crop. It is estimated that safrinha soybean yields need to be at least 33 sacks per hectare to cover costs (29 bu/ac).

In the municipality of Alto Parana, the safrinha soybean acreage decreased 18% this year while the safrinha corn acreage increased 23%. Much of the safrinha soybean crop is now dedicated to seed production for the next growing season.

Brazilian scientists and agronomists want the Paraguayan government to adopt a soybean-free period and a prohibition of planting safrinha soybeans as a way to limit the damage from soybean rust. Most of the soybeans in Paraguay are produced in the southeastern part of the country, just across the border from western Parana and Mato Grosso do Sul. Scientists feel that the extended soybean growing season in Paraguay helps to extend the time that active soybean rust spores can be blown into southern Brazil. In fact, the state of Parana registered more cases of soybean rust during the 2015/16 growing season than any other Brazilian state.