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December 27, 2018

Southern Brazil Receives Some Rain, but Needs Much More

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

The problem in Brazil of course has been the hot and dry conditions across south-central Brazil from about mid-November until last week. The driest areas are Parana, southern Mato Grosso do Sul, and Sao Paulo. Over the last week or two, the dryness has started to move further north into parts of Mato Grosso, Goias, Minas Gerais, and Bahia. Many areas have been 30 days or more without rain with a few isolated areas in Mato Grosso do Sul that have been 60 days without a rain.

Temperatures in the dry areas have been very warm, in the mid to upper 90's with long hours of very intense solar radiation due to the Summer Solstice in the Southern Hemisphere.

There have been some showers in recent days, but not enough to erase the moisture deficit. The rainfall appeared to be greater in the eastern and southern areas and lighter in the western and northern areas.

It's the early planted or early maturing soybeans that have been impacted the most because the crop was setting pods and filling pods during the hot and dry weather. Even if rains would return, the early planted soybeans are too far along in their development for any meaningful recovery. The later planted or later maturing soybeans could still recuperate somewhat if good rains returned to the area.

This is a very generalized, but I would estimate that 20% to 25% of Brazil's soybean acreage has some level of dryness. I arrived at that percentage by estimating the percent of dryness in the following states: 50% of Parana, 50% of Mato Grosso do Sul, 50% of Sao Paulo, 30% of Minas Gerais, 30% of Goias, and 20% of Mato Grosso.

Mato Grosso - Soybean harvesting started in central Mato Grosso about a week ago and the reported yields are in the range of 52 to 53 sacks per hectare (46 to 47 bu/ac), which is good for 90-day maturity soybeans. The weather in central Mato Grosso has been good since the crop was planted in mid-September, so these good yields are not surprising. The weather has not been as good in other parts of the state especially in southern and eastern Mato Grosso.

For example, in Rondonopolis which is located in southeastern Mato Grosso, the December rainfall thus far has been 2.3 inches and the majority of that fell on December 1st. The average rainfall in Rondonopolis during December is 11 inches.

The Mato Grosso Institute of Agricultural Economics (Imea) estimates that 1-2% of the state's soybeans could be harvested by the end of December, 5% by the end of the first week of January, and 15-20% by the end of January.

Parana - Western Parana is the driest area of the state, but the dryness has also moved in northern and northwestern Parana. The early planted soybeans have been the hardest hit because the crop was setting pods and filling pods under the adverse conditions. Even if good rains returned to the state, it would probably be too late for the early maturing soybeans because the crop is too far along in its development. Improved rainfall could still help the later planted soybeans.

In general, soybean yield losses in Parana are in the range of 10-15% statewide with losses in certain areas potentially as high as 30-40%. In a few isolated areas, loses could be as high as 50% or more. It all depends on date of planting, soil fertility, soil structure, and the soybean variety. In their December Report, the Department of Rural Economics (Deral) lowered their estimate of the 2018/19 soybean production in Parana by 500,000 tons to 19.1 million and I suspect they will lower it again in their January report.

Other private analysts have lowered their estimate for Parana's soybean production much more with some dropping the production by as much as 3 million tons. Early harvest reports from Parana indicate lower than expected yields, but the sample size is still very small. Parana is the second leading soybean producing state in Brazil after Mato Grosso.

Mato Grosso do Sul - The same hot and dry conditions that are impacting the crops in Parana are also impacting the crops in southern Mato Grosso do Sul where much of the area has been as much as 30 days without rain and a few isolated areas up to 60 days without rain. Once again it is the early planted soybeans that have been impacted the most because they are setting pods and filling pods under adverse conditions. In addition to the extended period of dryness, recent temperatures have been very hot in the mid to upper 90's.

The soybean crop across the state has probably lost 10% of its yield potential already with loses mounting every day there isn't rain. Mato Grosso do Sul is the fifth leading soybean producing state in Brazil.

Rio Grande do Sul - The rainfall in Rio Grande do Sul has been erratic. In fact, there has been some excessive rains in the state that required the replanting of some of the soybeans. Other areas of the state continue to receive less than their normal amount of rainfall. The soybeans in the state are some of the latest planted soybeans in Brazil so most of the crop is still in its vegetative development. Recently, there has been widespread showers across the state.

Goias - Over the past several weeks, the dryness has crept northward in Brazil into southern Goias. The heaviest concentration of soybean production is in southwestern Goias and that is where the weather has been the driest. As in the other parts of Brazil, it is the early maturing soybeans that have probably been impacted the most in Goias.