Oct 30, 2019

2019/20 Brazilian Soybeans 35% Planted, About Average

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

The rainfall last week in central Brazil was the best of the season thus far, but the rainfall is still less than what is normal for this time of the year. The improved weather last week allowed Brazilian farmers to make good progress on their 2019/20 soybean planting which is now 34% planted compared to 49% last year and 36% average, according to Arc Mercosul.

After a slow start to planting, things have improved in Brazil especially in the state of Mato Grosso. The area where dryness is still a concern is centered in south-central Brazil and the states of Parana, Mato Grosso do Sul, Sao Paulo and surrounding areas. Soybean yields in Brazil could still be OK as long as the planting is not delayed past about mid-November. The area to watch for rainfall going forward is south-central Brazil.

Mato Grosso - The big advance last week was in the state of Mato Grosso where the soybeans are now 64.5% planted compared to 73% last year and 48% average. This represents an advance of almost 23% for the week. Over the last two weeks, the farmers in the state have planted 45% of their soybeans! The most advanced planting is in the western and mid-north regions of the state where the soybeans are 78% planted. The slowest planting is in the northeastern region where the soybeans are 40% planted.

In the municipality of Querencia, which is located in east-central Mato Grosso, the soybeans were 60% planted earlier last week and farmers expect to have the crop completely planted by the end of this week. Soybean yields in the region are expected to be 57 sacks per hectare (50.6 bu/ac), which is the same as last year. Some of the safrinha corn may be planted later than last year when 70% of the corn was planted within the ideal window. Farmers have forward contracted 60% of their anticipated soybean production for an average price of about R$ 70.00 per sack (approximately $8.00 per bushel) and they are expecting to make a profit on their soybeans.

In the municipality of Nova Mutum, which is located in south-central Mato Grosso, the soybeans were 70% planted earlier last week and they should finish planting by the end of October. They are expecting yields in the range of 57 sacks per hectare (50.6 bu/ac), which would be similar to last year. While the minor planting delay should not impact the soybean yields, the president of the Rural Syndicate expects lower safrinha corn yields of 107 sacks per hectare (98.8 bu/ac) compared to last year's yield of 110 sacks per hectare (101.6 bu/ac). Farmers are forward contracting their soybeans in the range of R$ 70 to 71 per sack (approximately $8.00 to 8.10 per bushel).

Imea estimates the soybean cost of production in Mato Grosso in 2019/20 is R$ 3,908 per hectare, which would translate to approximately $395 per acre. With a yield of 50 bu/ac, that would translate to approximately $7.91 per bushel. Many farmers in Mato Grosso could produce more than 50 bu/ac. The current price in the state is in the range of R$ 72.00 per sack or approximately $8.20 per bushel.

Parana - In the state of Parana, the soybeans were 45% planted earlier last week and the crop was rated 2% poor, 26% average, and 72% good. Parana has been one of the driest areas of Brazil and as a result, some of the soybeans will need to be replanted due to poor germination.

In the municipality of Assis Chateaubriand, which is located in western Parana, 95% of the soybeans have been planted, but approximately 30% of the soybeans will need to be replanted due to poor germination. The president of the Rural Syndicate of Assis Chateaubriand feels that the soybean yields in the municipality have already been compromised due to the less than desired plant populations and the need for replanting.

Additionally, he feels the delay will also compromise next year's safrinha corn planting. A significant portion of the safrinha corn will be planted after the ideal window closes on February 25th. If the safrinha corn is planted in March, it has a much lower yield potential compared to safrinha corn planted in January.

Mato Grosso do Sul - Dry weather continues to delay the soybean planting in Mato Grosso do Sul. Aprosoja/MS estimates that 12.5% of the soybeans have been planted compared to 40% last year. This is the slowest soybean planting in the state in five years. They are expecting a statewide yield of 52 sacks per hectare (46.1 bu/ac) compared to 48 sacks per hectare last year (42.6 bu/ac).

The delay in soybean planting will impact the planting of the safrinha corn which is usually planted in January and February. With the delayed soybean planting, the safrinha planting window will now be from the end of February to about March 10th. The safrinha corn acreage might actually decline if the soybean planting delays continue. Farmers in the state have forward contracted 28% of their anticipated soybean production.

Maranhao - Farmers in the state of Maranhao, which is located in northeastern Brazil, started planting their soybeans about 20 days ago and they had planted 10% of their soybeans by the middle of last week with most of the planting occurring in the southern part of the state. Soybean planting in the southern part of the state should be complete by the third week of November, while in the northern part of the state, planting should be complete by early December.