Aug 23, 2021

Consecutive La Nina's Could Pose Severe Problems for Argentina

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

The National Oceanic and Atmospheric Association (NOAA) increased the chances of a second La Nina in a row during the South American summer to 70%. A La Nina generally results in below normal rainfall for southern Brazil and northern Argentina. Both regions are still in the midst of one of the driest periods in over seventy years and continued dryness from a resurgent La Nina could be devastating.

The 2020/21 safrinha corn crop in Brazil suffered severe losses from dry weather and a series of frosts in June and July. The 2020/21 corn and soybean crops in Argentina were also negatively impacted by dry weather. Currently, the winter wheat crop in Argentina is also under significant moisture stress. So, southern Brazil and Argentina can ill afford another dryer-than-normal summer growing season.

During La Nina years, southern Brazil and Argentina generally receive about 30% less rainfall than normal. Soybean yields in Argentina during a La Nina can be down as much as 38% with less of an impact on corn yields. Corn preforms better in Argentina during a La Nina because the corn planting is split in two distinct phases, early and late planting. This reduces the risk of dry weather occurring during important reproductive phases.

According to a report issued by the Rosario Grain Exchange, over the last 35 years there have been three times that there were two consecutive La Nina events, during 2008/09, 2011/12, and 2017/18. During all three of those growing seasons, the corn and soybean yields in Argentina were disappointing.

Not only does the dry weather impact crop production in Argentina, it also has a profound impact on water levels in the Parana River. The river is important for energy generation and approximately 80% of Argentina's agricultural exports use the Parana River.

The water level on the Parana River is at its lowest point in over seventy years and there is little chance the current low levels will improve until at least November when the summer rains return to southern Brazil, which is the head water of the Parana River.