South America Calling

The torrential rain continues to fall across Mato Grosso, Brazil's main soy state, but the farmers are harvesting regardless.

As a result, they have so far delivered approximately 418,900 metric tons (mt) of soybeans, around 20% of the harvested crop, with higher-than-acceptable moisture levels or moisture-related damage, according to the Mato Grosso Agricultural Economy Institute (IMEA).

Elevator staff talk of soybean consignments so wet that they set like a jelly in the truck.

Farmers are harvesting, and swallowing the resultant discounts on the beans, in order to ensure the best conditions for the second-crop corn that is planted directed after the soybeans.

Planting in January gives the corn it a better chance of receiving enough rain before the dry season starts in April or May

In truth, producers can't complain too much as they knew when they planted this soy in September and October that it normally rains this hard in January and February -- precipitation was near average last month.

It's one of the risks you take when you double crop in Mato Grosso. The difference this year is that many producers have brought forward the soybean cycle and taken that risk. IMEA estimates that Mato Grosso harvested 2.1 million metric tons in January, up 79% on the same period one year before.

However, before anybody overplays the market impact of this development, it is worth noting that the 418,900 mt of sodden or moisture-damaged soy only represents 1.7% of the forecast crop and the rest is largely benefitting from the rain.

As of last Friday, Mato Grosso farmers had harvested 17.4% of the soybean crop, according to IMEA.

Alastair Stewart can be reached at alastair.stewart@telventdtn.com

(ES)

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