July 27, 2012

Cold and Rainy Weather Could Impact Brazilian Wheat Production

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

Wheat producers in the state of Parana in southern Brazil are concerned that their wheat crop may be adversely affected by a prolonged period of cold and rainy weather that occurred during the month of June. In addition to lower yields, farmers are worried that the wet weather will result in increased disease pressure and lower grain quality.

Much of the wheat crop in Parana that was planted in April and early May was blooming at the time of low temperatures and rainy conditions. There were several episodes of frost in western Parana during June, but the biggest problem may end up being the nearly constant rainfall. The wheat that was flowering in western Parana encountered 16 inches of rainfall during a 16 day period. Researchers from Embrapa have surveyed the wheat in western Parana and have found elevated disease levels especially gibberellin. As a result, yields are expected to be reduced by diseases and the seed quality could be compromised as well.

Most farmers in Parana agree that the rainy weather was more problematic than the cold temperatures. Parana is the largest wheat producing state in Brazil and the wheat will be harvested between September and November.

Brazil is expected to produce approximately 5 million tons of wheat, but the domestic demand is expected to be 10 million tons. The deficit in wheat production is generally made up by importing wheat from Argentina. Argentine suppliers have already raised prices to US$ 350 per ton and millers in southern Brazil are bracing for even higher prices. Wheat prices generally accompany the price of corn and corn has surged higher as the worst drought in 50 years continues to impact U.S. corn production.

Brazilian millers have also complained in recent years that the quality of Brazilian wheat is generally inferior to the wheat imported from Argentina. The lower quality of Brazilian wheat generally results from excessive rainfall during the time of harvest. The wheat in Parana is generally harvested in late September or October and the wheat in Rio Grande do Sul is generally harvested in late October or November. High temperatures and excessive rainfall during this period can quickly compromise the quality of the wheat seed.