January 31, 2017
Trip Report - Mato Grosso and Central Brazil
Below are some of my observations after traveling for two weeks through Mato Grosso and central Brazil.
- January is the peak of the rainy season and it was certainly wet while we were there.
- It rained every day we were there except one. Some days there were numerous light showers throughout the day with heavy overcast skies. Other days, there were torrential downpours. We were in the city of Sao Paulo last Thursday as they celebrated 463 years since its founding amidst very heavy rain. In fact, January is going to be one of the wettest on record in the city of Sao Paulo.
- The heavy overcast skies only broke occasionally for a few hours of sunshine.
- The temperatures were warm, but lower than expected due to the overcast skies.
- We did not see a single combine in the field harvesting during our entire trip.
- January has turned out to be very wet across central and southeastern Brazil.
- The early harvest pace is slower than what had been anticipated. Imea originally estimated that the harvest pace in Mato Grosso at this point would be 25% complete, but wet weather has slowed the harvest which is now 16% complete. The normal harvest pace in Mato Grosso for this date is approximately 10% to 12%.
- Some early maturing soybeans have suffered quality concerns due to the wet weather and the delayed harvest. Some farmers are reporting that the soybeans are losing weight due to fungal diseases and that the soybeans might only be suitable for animal feed.
- While the wet weather is impeding the early harvest, the ample moisture is good for the later maturing soybeans that are in the midst of pod filling.
- Early yield results from before the wet weather set in are generally good and they should get better as the harvest moves into the later maturing soybeans.
- Mato Grosso is still expected to set a new record high soybean production unless the weather continues to be excessively wet during February.
- We did not see much full-season corn, but what we did see generally looked good with a few exceptions.
- The safrinha corn is being planted slightly slower than anticipated due to the wet weather.
- The earliest planted safrinha corn was maybe six inches tall and the safrinha corn stands looked good.
- There is still uncertainty surrounding the safrinha corn acreage in Mato Grosso. Some analysts in Brazil are expecting a 15-20% increase in safrinha corn acreage while others are expecting an increase of 4-7%.
- We were pleasantly surprised by the condition of the highways in central Brazil. There are certainly in better shape today than in previous years.
- The biggest improvement is the lack of pot holes. It was very evident that there has been a concerted effort to fill in the pot holes.
- The number of trucks on the highways is heavier than ever, but the improved condition of the highways made traveling less stressful.
- BR-163 is the main highway in Mato Grosso and there has been some progress in making it into a four-lane highway.
- BR-163 is now a four-lane freeway from Rondonopolis south to border with Mato Grosso do Sul, which is about 120 kilometers. Between Rondonopolis and the state capital of Cuiaba, there are stretches that are now four lanes and north of Cuiaba, there are also other stretches that are four lanes. In total, approximately 900 kilometers of BR-163 are scheduled to be converted into a four-lane highway and I would estimate that maybe 150 kilometers have already been completed.
- The truck traffic was extremely heavy with trucks waiting everywhere for loads.
- Most of the major highways in central Brazil are now toll roads. In my opinion, the tolls are very steep with a passenger cars paying $1.50 to $2.00 every 50 to 60 kilometers. Big grain trucks pay $12.50 to $14.50 every 50 to 60 kilometers. A tandem grain truck would pay approximately $120 in tolls just to travel BR-163 within the state of Mato Grosso.
- We were there during the most recent truck driver strike and I sympathize with the truck drivers. They are losing money due to the low freight rates and there is not an easy solution to this dilemma. The low freight rates are good for farmers, but a disaster for transportation companies.
- There is more talk/discussion/meetings concerning further construction of railroads in Mato Grosso.