La Nina’s return could threaten South American cultures again – Markets

FORT COLLINS, (Colo.): Many South American farmers scowl at the thought of La Nina’s presence during their corn and soybean growing seasons, especially if things are already dry like now, though thankfully, La Nina doesn’t always dictate the end results.

Earlier this month, the US government estimated the chance of La Nina to be 70% from November to January 2022. Those odds are higher than forecast from a year ago, which preceded the episode of La Nina on stronger in a decade. Over the past month, surface waters in the equatorial Pacific have cooled significantly from normal, characteristic of conditions in La Nina. La Nina is often associated with dry weather in Argentina and southern Brazil, but this is not always guaranteed.

The upcoming La Nina is expected to be a bit weaker than last year’s event, but since the strength doesn’t quite match the weather, any degree of La Nina or its hot counterpart El Nino should be watched closely.

Plantings have not yet started in South America so it is time to replenish humidity and forecasts suggest that rains may arrive soon.

Argentina’s corn and soybean yields earlier this year fell below average because the growing season was drier than normal. It was nowhere near as bad as the 2018 crop, which was paired with a slightly weaker La Nina than the recent one.

Brazil had a bumper soybean crop in early 2021, but its second crop of heavily exported maize was hugely disappointing. Drought and then frost ravaged the south, including No. 2 corn and bean producer Parana, where second corn yields were at half normal levels.

Secondary maize yields were also reduced by the prolonged drought in Mato Grosso, the leading producer, although to a much lesser extent than in the south. Brazil’s total maize harvest for 2020-21 is estimated to be around 15% below the previous year’s record.

Mato Grosso should come out of its dry season in the coming weeks, although this period has been very dry this year. Farmers typically start planting soybeans on or after September 15, and forecasts suggest decent rains could start within a week.

Soybean planting is most important in Parana in October, although the full season corn will start earlier. A replenishment is desperately needed there after several months of short rainfall, although weather models also show a chance of rain over the next week.

Soil moisture is not a good indicator in central and northern regions of Brazil like Mato Grosso, as soils do not retain moisture like they do in other important world growing regions. Rainfall amounts, if normal, are usually sufficient to produce a strong harvest even if the season starts dry.

Argentina does not seriously start planting soybeans until November, but corn planting usually extends from September to January. The past three months have seen about half of normal precipitation, although forecasts indicate good rains could arrive next week.

Argentina’s corn and soybean yields have a distinct relationship with La Nina and El Nino.

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About Marco C. Nichols

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