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April 7, 2020

Brazil Soy 86% Harvested, Rio Grande do Sul Severely Impacted

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

The Brazilian soybeans are 86.2% harvested compared to 85.4% last year and 79.9% for the 5-year average according to Arc Mercosul. This represent an advance of 8.5% for the week and this is the first time this year that the harvest pace is ahead of last year. The two areas left to harvest are basically far southern Brazil and northeastern Brazil.

Conab soybean yield estimates - Conab will release their latest estimate of the 2019/20 Brazilian soybean crop on Thursday, April 9th. They issued a statement last week indicating that they conducted their survey for the report before any travel restrictions were put in place due to the Covid-19 pandemic.

Conab had previously conducted 16 different Crop Tours across 10 Brazilian states starting in January. The ten states represent 92% of Brazil's total soybean production. The tours were scheduled to coincide with the end of the pod filling period but before the soybeans were harvested. During the tours they collected more than 1,000 samples by going into the fields and counting the number of plants, the row spacing, and the amount of grain per plant and estimating the yield at each location. The objective yield data is then combined with subjective yield estimates collected on a monthly basis when 75 technicians from Conab contact approximately 900 individuals across the country to obtain their subjective yield estimates.

Rio Grande do Sul - The soybean harvest in Rio Grande do Sul was 58% complete as of late last week according to Emater. Light and scattered rains last week allowed farmers to make rapid harvest progress. The soybean crop in the state continue to suffer from one of the worst droughts in recent memory. The state did receive a few light and scattered showers in recent days, but they were woefully inadequate to change the overall dry situation.

The month of March ended up being the driest month of the summer in the state and the hot and dry conditions hit the soybeans during their critical pod filling phase. The result has been at least a 40% reduction in soybean yields across the state, which is the worst decline ever recorded according to the Soybean and Corn Producers Association of Rio Grande do Sul (Aprosoja).

In many northern areas of the state, soybean yields are in the range of 2,100 kg/ha (31.0 bu/ac), but in the harder hit southern areas of the state, yields are down as much as 80% with some as low as 600 kg/ha (8.8 bu/ac).

Approximately 4,800 soybean producers in the state have already requested assistance from the Crop Insurance Program and more than 8,000 producers have asked for assistance under the Program to Guarantee Agriculture and Livestock Activities (Program). The Brazilian Minister of Agriculture has ordered the Bank of Brasil to streamline and simplify the process for farmers to apply for assistance during periods of quarantine due to the Covid-19 crisis.

At the start of the growing season, it was estimated that the state would produce approximately 19.5 million tons of soybeans, but many recent estimates have the production in the range of 9 to 10 million tons. The central and southern areas of the state were hardest hit and the drought has impacted not just grain producers but also cattle ranchers, dairy producers, fruit producers, vegetable producers, etc.

Rio Grande do Sul is general the second or third largest soybean producing state in Brazil responsible for approximately 16% of Brazil's soybean production. In some years it trails Mato Grosso and Parana in soybean production and in some years it surpasses the state of Parana by a slim margin.