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January 29, 2014

Early Soy Harvesting and Corn Planting Slow in Mato Grosso

After nearly two weeks of persistent wet weather, the farmers in Mato Grosso are hoping for dryer weather this week to increase their soybean harvesting activities. According to the Mato Grosso Institute of Agricultural Economics (Imea), the soybean crop in the state is approximately 6% harvested, which is 2% slower than last year at this time.

The soybean harvest is most advanced in the western part of the state where 12-15% of the crop has been harvested. Most of the early soybeans in western Mato Grosso will be followed by a second crop of cotton, which according to Imea, is now approximately 65% planted. Farmers are getting concerned about the lateness of the cotton planting because the ideal cotton planting window will close on January 31st. If cotton is planted past the end of January, there is a risk that the crop will run out of moisture before it has had an opportunity to mature.

In the north-central part of the state, the soybean crop is only 5% harvested. This is also the region of the state where most of the safrinha corn is planted, but only 1% of the intended safrinha corn acres had been planted by the end of last week. The ideal planting window for safrinha corn in the state extends until about February 20, but many farmers plant past that date. Planting the safrinha corn past the end of February though is a risky proposition.

The last rains of the season in central Brazil normally fall at the end of April or early May, but for the last two years, the rains continued to fall until late May or early June. If that would occur again this year, then safrinha corn planted in March would have time to complete the grain filling process before the onset of the dry season. If the rains would end earlier than normal in March or early April, then safrinha corn planted in March would run out of moisture before the grain filling process is complete.

Imea estimates that farmers in the state will plant 3.25 million hectares of safrinha corn, but the final acreage number is still in doubt. Many farmers are hesitant to plant safrinha corn because they are worried about low corn prices and the possibility of even lower prices later in the year when the crop is harvested.

The statewide average corn price during the third week of January was R$ 13.88 per sack of 60 kilograms or approximately US$ 2.63 per bushel. One of the highest prices in the state was in southeastern Mato Grosso in the municipality of Primavera do Leste where a sack of corn was selling for R$ 15.80 per sack or approximately US$ 2.99 per bushel. One of the lowest prices was in the municipality of Campo Novo in the western part of the state where a sack of corn was selling for R$ 12.50 or approximately US$ 2.36 per bushel. The Mato Grosso Soybean and Corn Producers association estimates that the cost of producing corn in the state is in the range of US$ 3.00 to 3.50 per bushel.

Much of the corn produced in the state during the last growing season ended up being sold to the government through a series of auctions. The government purchased the corn at the guaranteed minimum price of about US$ 3.00 per bushel. They then subsidized the transport of the corn to livestock producers or exporters in southern Brazil as well as to small family farmers in northeastern Brazil to feed their livestock.