South America Calling

Brazil's Mato Grosso, Matopiba End Year on Red Alert

Farmers in Mato Grosso have never seen a year like it.

Renowned for its metronomic summer rains, precipitation in Brazil's No. 1 soybean state has been spotty and irregular since the season began in September.

And with early-planted beans nearing maturity, it is increasingly clear that yield potential in part of the crop has been compromised.

Beans in the north and east of the state are worst affected with "aborted flowerings and pods due to drought stress" noted on various farms, said AgRural, a local farm consultancy.

The extent of the damage is very difficult to assess as the rainfall's inconsistency means crop conditions vary greatly from municipality to municipality and even farm to farm. But it is clear the situation is becoming critical, said Nery Ribas, head agronomist at the Mato Grosso Soybean and Corn Growers Association (Aprosoja).

Worryingly, rains will continue to be irregular across the state for the next couple of weeks and probably through the whole of January, said Marco Antonio dos Santos, forecaster at Somar Meteorologia, a local weather service.

Last week, IMEA, a Mato Grosso farm analytics service, reduced its state soy crop forecast by 1 million metric tons to 28 mmt on the drier weather and warned that, since the crop is hitting decisive development stages, that losses could mount quickly if more consistent rains don't return quickly. It estimates that 23% of the state's crop is in 'bad' condition, while 20% of area is in 'very bad' condition.

The biggest problems are to be found north of Sorriso, the main Mato Grosso soy municipality.

When Brazilian farmers cleared plots in Mato Grosso in the 1970s and 1980s, they were essentially investing in rainfall.

The land was poor but precipitation was so regular that it was worth fixing it up to grow soybeans and it is on that basis that the state has grown into one of the biggest grain-producing regions in the world.

It is the extremely strong El Nino that has changed things this year, concentrating Brazilian rainfall in the south of the country, explains Somar's Santos.

The weather phenomenon is also contributing to dry weather in Matopiba, the soy region in the eastern Cerrado that covers parts of Bahia, Piaui, Maranhao and Tocantins states.

The lack of rainfall is even more acute in this region, leading to grave concerns that farmers will register losses for the third consecutive year in many cases. Planting occurs later in this region, and so damage is not yet significant. But the delay -- the region's planting is still only 72% complete, compared with a five-year average of 85% -- is unsettling farmers as the region often suffers late-season dry spells.

In compensation, the outlook is generally good in southern Brazil. Excess rain has led to some disease pressure but nothing too dramatic, said AgRural.

But the chance of losses in Mato Grosso and Matopiba crop has analysts lowering forecasts.

On Friday, Franca Junior, a local consultancy, lowered its 2015-16 soybean crop view from 101.1 mmt to 97.9 mmt, citing the dry weather.

Further downward adjustments may be on their way.



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andrew mohlman
12/23/2015 | 8:14 AM CST
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