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March 26, 2014

Brazil and Paraguay to Plant 1.3 mha of Safrinha Soybeans

Two reports in South America this week illustrated the potential for safrinha soybean production in both Brazil and Paraguay. Even though most specialists advised against the practice of planting two crops of soybeans back-to-back due to the potential for increased insect and disease pressure, many farmers saw it as an opportunity to take advantage of strong soybean prices and relatively weak corn prices.

In Brazil, farmers reduced their safrinha corn acreage and substituted soybeans instead. In Paraguay, generally very little safrinha corn is planted so the soybeans are being planted where normally the land would lay fallow for several months.

IBGE in Brazil (the Brazilian Institute of Geography and Statistics) is reporting that Brazilian farmers have planted 745,000 hectares of safrinha soybeans, but the official reporting agency, Conab, has not yet released an estimate of the safrinha soybean acreage. If confirmed, this would represent a six fold increase in safrinha soybean acreage over the last growing season. If these soybeans yielded 2,000 kg/ha (29 bu/ac), which is two thirds the yields of full-season soybeans, then the safrinha soybeans in Brazil would produce approximately 1.5 million tons.

In Paraguay, it is estimated that farmers planted 550,000 hectares of safrinha soybeans. That is the assessment of the team conducting the Gazeta do Povo's Harvest Tour (Gazeta do Povo is a newspaper in Curitiba, Parana). If the same yield was achieved as the safrinha soybeans in Brazil (2,000 kg/ha or 29 bu/ac), then the safrinha crop in Paraguay would produce 1.0 million tons.

If verified, the 550,000 hectares in Paraguay would be double last year's acreage and five times more than two years ago. Ten years ago few farmers in Paraguay planted a second crop after soybeans, but today more than half of the farmers in the country plant at least two crops.

Some farmers in Paraguay are actually able to plant three crops per year. The first crop is planted to soybeans in September, or when the first rains of the summer occur. The second crop is also soybeans planted immediately after the first crop is harvested. Then the third crop is winter wheat planted after the second crop of soybeans is harvested.

Farmers in Paraguay are allowed to plant soybeans earlier in the spring than in Brazil. Farmers in Brazil must wait to plant until the end of the 90-day soybean free period which ends on September 15th. Paraguayan farmers have no such restriction, so they are able to plant as soon as the first rains of the summer arrive.