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December 3, 2013

Corn Earworm under Control in Brazil, at Least for Now

As farmers in Mato Grosso finish planting their 2013/14 soybean crop, their attention is now directed toward making sure their crop is protected from diseases like soybean rust and insects such as the corn earworm.

Thus far, their efforts to control the corn earworm have been successful. Many farmers applied heavy doses of insecticides shortly after the soybeans emerged in an effort to prevent the insect from getting established in their fields. The average soybean field in Mato Grosso generally receives two insecticide applications for the control of leaf-eating worms, so if farmers only need to make two applications this year, their costs will not increase. More than two insecticide applications thought will increase their costs.

In the worst case scenario in Bahia last growing season, some farmers sprayed nine times to control the earworm, but the situation is not expected to be nearly as bad in Mato Grosso this year. The climate in Mato Grosso is less favorable for the insect and seven applications would be considered the absolute maximum. If that many applications were applied, the cost of production could increase 6% to R$ 2,485 per hectare or approximately US$ 437 per acre.

As far as soybean rust is concerned, Embrapa reported that the first case of soybean rust was confirmed in the state late last week, but the diseases was identified on volunteer soybeans and not in commercial fields. Not having any rust in commercial fields before the start of December is a good sign for Brazilian farmers. Some of the earliest planted fields will start to be harvested in approximately 45 days, so there is not much time left for the disease to impact these early maturing varieties.

With the potential for increased costs, farmers in Mato Grosso are pleased to see the soybean price move higher during the month of November. According to the Mato Grosso Institute of Agricultural Economics (Imea), the higher prices were the result of a 3% devaluation of the Brazilian currency during November and a 5.6% increase in soybean prices on the Chicago Board of Trade. Soybean prices in Rondonopolis for March delivery averaged R$ 52.75 per sack or US$ 10.42 per bushel during the month of November. That represented an increase of R$ 5.40 per sack compared to October and it is now slightly higher than the cost of production which is approximately R$ 45 to R$ 46 per sack.