Sep 20, 2013

Brazil Wheat Crop Disappoints, Shortage of Seed Wheat for 2014

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

The wheat crop in southern Brazil has suffered a series of setbacks this growing season including heavy rains at the start of the growing season and several episodes of freezing temperatures. The result has been a 30% reduction in the Parana wheat crop and a predicted shortage of seed wheat for the 2013/14 growing season.

The worst event was a four day period of sub-freezing temperatures in southern Brazil during the last week of June. The impact was most severe in the state of Parana where the more advanced wheat was heading and flowering at the time of the frosts. A second frost in early August resulted in additional damage to the crop. The Secretary of Agriculture in the state estimated that the frosts reduced the state'Cs wheat crop by 950,000 tons or 33%.

Significant damage also occurred in the wheat fields dedicated to seed production for next year. Before the frosts occurred, the Parana Seed Producers Association (Apasem) estimated that the state would produce 160,000 tons of seed wheat, but that amount of seed production will no longer be possible.

As a result, seed producers are hoping to obtain additional supplies of seed wheat from the states of Sao Paulo and Rio Grande do Sul, but these fields must be certified by the Minister of Agriculture before they can be sold as certified seed. Even with these potential additional supplies, there will not be enough seed available of the more popular varieties to meet the expected demand in 2014.

Improved wheat prices are expected to encourage Brazilian farmers to increase their wheat acreage in 2014. In fact, farmers are already contacting their seed dealers inquiring about available supplies of seed wheat for next year. Farmers in Parana increased their wheat acreage 25% in 2013 to 976,000 hectares compared to 782,000 hectares in 2012 and they are expected to increase it even more in 2014.

The wheat fields of Rio Grande do Sul were not as impacted by the frosts in July and August because the crop was still in its vegetative stage when the cold temperatures hit. Earlier this week, another cold front brought light frosts again to the wheat fields of Rio Grande do Sul. Even though the state extension service (Emater) estimates that 70% of the wheat is now flowering and filling grain, the cold temperatures resulted in only isolated light frosts in low-lying areas of the state and little overall damage to the crop.