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January 23, 2019

Brazil's Soybeans 6% Harvested, Early Yields are Disappointing

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

The weather in Brazil just can't "get on track." The rainfall continues to be below normal across the majority of central Brazil and it is especially getting dry in eastern and northeastern Brazil. While southern Brazil is receiving rain, the dryness has moved northward in Brazil. There is some rain in the forecast, but it does not appear to me to be enough to reverse the overall trend.

The 2018/19 Brazilian soybean crop is 6.1% harvested compared to 0.8% last year and 1.2% for the 5-year average according to AgRural. The soybean harvest advanced 4% last week.

Mato Grosso - The soybeans in Mato Grosso are 12.3% harvested compared to 3.2% last year and 6.3% average. The fastest harvest pace is in western Mato Grosso where 18% of the soybeans nave been harvested, the slowest is 4.6% harvested in northeastern Mato Grosso. The soybean harvest is record fast thus far.

The early yields in Mato Grosso are reported to be below expectations. In the municipality of Sorriso, which is located in central Mato Grosso, farmers are reporting yields in the range of 50 sacks per hectare (44.4 bu/ac) compared to last year when the yields were in the range of 60 sacks per hectare (53.2 bu/ac). In the municipality of Lucas do Rio Verde, which is located in south-central Mato Grosso, early soybean yields are reported to be 10-15% below what was expected. In Primavera do Leste, which is located in southeastern Mato Grosso, yields are coming in below the expected 65 sacks per hectare (57.7 bu/ac) they had been expecting.

Parana - The soybeans in Parana are 11.9% harvested compared to 0.3% for the 5-year average. The hot and dry weather during December accelerated the maturation process and as a result, the soybean harvest in Parana is about two weeks earlier than last year. The soybeans in Parana are rated 12% poor, 28% average, and 60% good. The crop is 7% in vegetative development, 25% flowering, 43% filling pods, and 25% mature or harvested.

The soybean harvest is most advanced in western Parana where early yields are in a wide range of 20 to 55 sacks per hectare (18 to 49 bu/ac). Some farmers who expected to harvest 60 to 70 sacks per hectare (53 to 62 bu/ac) are reporting yields as low as 33 sacks per hectare (29.3 bu/ac) or a reduction of 60% from early expectations.

Goias - Farmers in Goias have harvested 4.1% of their soybeans compared to 0.2% for the 5-year average. Lack of rainfall and high temperatures since the first of the year has resulted in disappointing early yields.

Mato Grosso do Sul - The average of three estimates from producer organizations in Mato Grosso do Sul indicate a production decline of 11% compared to initial expectations. The state had been expected to produce a record crop of 10 million tons of soybeans, but that has now been reduced to 8.9 million tons. Last year the state produced a record crop of 9.5 million tons.

Farmers in the state had expected to produce 59 sacks per hectare (52.3 bu/ac), but that has now been reduced to 52 sacks per hectare (46 bu/ac). The problem was dry weather during December that impacted the early maturing soybeans. In the southern part of the state, they went 20 days without rain in December, northern areas went 18 days without rain, and northeastern areas went 15 days without rain. These are the three main soybean producing areas of the state.

Rio Grande do Sul - The weather in Rio Grande do Sul has been extreme especially in the southern and western regions of the state. In western Rio Grande do Sul, they have received the most rainfall during January in 21 years. There has been widespread localized flooding and many soybean fields have been under water for at least 5 days. Farmers in the region are reporting that many hectares of soybeans have been lost. Roads and bridges are in poor condition especially in low lying areas.

The weather has been very different in northwestern Rio Grande do Sul where rainfall has been Ok. Farmers in northwestern Rio Grande do Sul expect to harvest 50 sacks per hectare (44 bu/ac), but prices are low in the range of R$ 65.50 per sack (approximately $8.00 per bushel). With a higher cost of production this year, they are concerned that they might lose money if they end up with lower yields.

Santa Catarina - Yields of the early planted soybeans in the western part of the state are expected to decline 20-30% from what was initially expected. Once again, it was the early planted soybeans that suffered the most from the hot and dry weather during December.

Bahia - In western Bahia the rains have not been as good as they were last year. The weather started off good, but it has been deteriorating for about the last month. There is not much rain in the forecast, so it is not an optimistic scenario for western Bahia.