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Brazil Soybean Farmers to Slow Early Selling Pace, Analyst Says
RIO GRANDE DO SUL, Brazil-- As the soybean planting reaches 98% complete, some farmers in Brazil are already harvesting the 2019 crop, according to consultancy AgRural.
Decisions to sell or store soybeans are facing farmers in the first-cut soybean areas.
Meanwhile, other regions are ready to start to harvest and others are recording yield losses due to a dry season. In the case of the state of Paraná, the second-largest oilseed producer in the country, there were municipalities with over 20 days without any drop of rain.
During the last weekend, the municipality of Itambé, in the western part of Parana, received less than 1.5 inches of rain. The hope for local farmers is that rains would be more generalized in the region after December 20. Some even speculate about the possibility of a loss of 5 million metric tons, if the losses in the state of Mato Grosso do Sul are also realized.
According to weather forecaster Climatempo, the accumulated rain will not be over 1.9 inches after the weekend, with higher than normal temperatures.
“The yield loss will depend a lot on soil fertilization, structure, management conditions, seed inoculation, choice of cultivar, and the time of planting. The losses can range from 10% to 45%, depending on each specific region,” says Itambe producer Valdir Fries.
Some Soybean Sales
Fries says that the general marketing strategy in his region has been to anticipate soybean sales. “Most farmers have been trying to sell soon because costs have increased. The dollar value jumped 25% and that is reflected in costs. Nearly 30% to 40% of production are sold before harvest,” stated the farmer.
In the case of the municipality of Guaíra, average temperatures are 64°F., but during this season the temperatures were over 82°F. This same area did receive rains that have helped save yield loss. “Our worry is a lot more about the price than the weather. Investment was lower this year, but still the price is bad. The numbers will not close,” said Guaira producer Silvanir Rosset.
Luiz Pacheco, a consultant based in Paraná, thinks that recent rains put a huge crop loss as something unlikely. “These rains already end with the speculation of huge loss,” Pacheco told Agriculture.com.
For consultancy AgRural, the only thing that can be said about the crop in Paraná is that yields would be lower than expected. The same feelings are being felt at the state government agencies.
Mato Grosso’s Big Crop
In Mato Grosso, it’s a very different scene. Because of good weather, the harvest already started in some regions and is the earliest harvest in history.
The Mato Grosso Institute of Agriculture Economics (Imea) estimates nearly 41.33% of a total of 32.4 million metric tons. Nationwide, the sales reached 31% of the crop, which is higher than the 26% of the crop that was sold in December 2017, according to consultancy Datagro.
The expectation of experts is that from now until mid-January, sales will slow.
“There is a lack of interest by producers to sell because the price is too low. No big deals will happen in the coming weeks,” says Datagro analyst Flavio França Jr.
AgRural estimates a total soybean production in Brazil of 121.4 million metric tons, while Datagro projects 124 million metric tons. The official projection of the National Supply Company (Conab) is 120.1 million metric tons.