Brazilian soy sowings forge ahead, but corn could get the benefits

03.11.2016

Farmers in Brazil's agricultural heartland are sowing soybeans at a sizzling pace this year.

But corn, rather than soybean, could see the benefit.

According to the Brazilian currency AgRural, 2016-17 soybean crop is now 41% planted, compared to 31% last year.

And in the Central South region, the pace is even faster. The Mato Grosso Institute of Rural Economics sees soybean planting in the top-growing state 67% complete, compared to just 38% last year, the fastest pace on record.

Are sowings too fast?

But despite noting the very fast pace of sowings, the US Department of Agriculture left its forecast for 2016-17 soybean production unchanged from last month, at a record 101.0m tonnes.

Estimates of planted area were also left unchanged.

The bureau said that farmers have only slightly increased their sowings as "many are still concerned about the high cost of production, higher interest rates, difficulty accessing credit lines, and financial difficulties at the farm as a result of last year's losses".

In fact this week analyst Dr Michael Cordonnier noted fears that farmers in Mato Grosso are actually planting too fast, as it will compress a large portion on the harvest into the month of January.

If January, usually the wettest month, sees heavy rains, damage to the soybean crop could be widespread.

A boon for corn

But if the rapid plantings are a mixed blessing for corn, they could provide a boost for the corn crop

More than half of Brazilian corn production is from the safrinha crop, which is sown after early-maturing soybeans have been harvested, in the same ground.

The quicker these soybeans mature, and are harvested, the quicker the safrinha corn can be planted, allowing farmers to take advantage of the optimal planting window.

High hopes in Parana

The USDA's Brasilia bureau noted that the early soybean sowings "can potentially benefit producers when planting a second crop right after the soybean harvest".

And Dr Cordonnier reports that in Parana, the second-ranked soybean and safrinha corn-growing stata, farmers are "very hopeful that they will harvest a record large soybean crop and still be able to plant a second crop of corn during the ideal planting window".

In Western Parana, "all the soybeans that will be followed by a second crop of corn have already been planted, which means that the safrinha corn will be planted by the end of January or early February, which is the ideal time for the safrinha corn," Dr Cordonnier said.  


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