Feb 15, 2022
Central Brazil Soy Will Not Compensate for Losses in S. Brazil
Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.
Record high or near record high temperatures coupled with scant rainfall over the last several months have resulted in a catastrophe for soybean producers in southern Brazil and the growing season is not over. The hope was that higher yields in central and northern Brazil would make up for losses in southern Brazil, but that is not going to happen (see table below).
In Brazil, the weather this growing season has been a tale of two extremes - central and northern Brazil where there has been excessive rainfall and southern Brazil where there has been a historic drought. The dividing line between the two different weather patterns has been very sharp since early November.
Some meteorologists in Brazil are forecasting that the hot and dry conditions will persists in southern Brazil and expand northward into central and southeastern Brazil. They are forecasting that areas of Brazil that were previously wet will see a dramatic drying during March and southern Brazil will remain hotter and dryer than normal in March and April. If that forecast verifies, it could have a major impact on the safrinha corn.
We knew the conditions were bad in southern Brazil, but they are turning out to be worse than expected and the season is not over. In Conab's February Crop Report, they lowered Brazil's soybean production by a stunning 12.5 million tons to 125.5 million. In the report, they signaled out Brazil's four southernmost states of Parana, Mato Grosso do Sul, Santa Catarina, and Rio Grande do Sul as to why they lowered the soybean estimate.
In the table below are Conab's soybean production estimates for the major soybean producing states. As you can see, in the northern areas where it has been wet, the estimates improved slightly. In the dry southern states, the estimates declined significantly.
Change in Brazil Soybean Estimates - February vs. January 2022
| State | January Soybean Estimate | Feburary Soybean Estimate | Change |
|---|---|---|---|
| million metric tons | million metric tons | ||
| Mato Grosso | 38.32 | 38.96 | +0.64 |
| Goias | 14.34 | 15.01 | +0.67 |
| Minas Gerais | 6.96 | 7.00 | +0.04 |
| Sao Paulo | 4.49 | 4.55 | +0.06 |
| Bahia | 6.99 | 7.01 | +0.02 |
| Parana | 18.46 | 13.04 | -5.42 |
| Rio Grande do Sul | 21.22 | 13.73 | -7.49 |
| Mato Grosso do Sul | 12.58 | 9.70 | -2.88 |
| Santa Catarina | 2.60 | 2.09 | -0.51 |
Rio Grande do Sul is the one big state where the soybean crop could still be impacted, but the forecast for that state is not encouraging. The soil moisture was only temporarily partially recharged and now the forecast is calling for a return of hot and dry conditions. Emater is estimating the soybean production in Rio Grande do Sul at 11.2 million tons, which is 2.5 million lower that Conab's estimate of 13.7 million tons.