Brazil's 2023 24 grain season got off to a bad start. While El Niño is characteristic of the current season (i.e., excessive rainfall in southern Brazil and dry climate in the central and western states), unusually high temperatures in November affected the growth of crops planted earlier in the season. In mid-November, temperatures in rural Mato Grosso exceeded 104 degrees Fahrenheit, sparking wildfires (extremely unusual at this time of year). Typically, early planting is done in October in central Brazil to promote the double crop, with corn often chosen as the second crop after soybeans.
Early growers in Mato Grosso experienced drought and temperature stress, and soybean plants showed signs of shorter vegetative growth, flowering much earlier than expected. **Agency estimates that 42% needs to be replanted, covering an area of 1.26 million acres. As a result, some growers have reconsidered their season plans and shifted from replanting soybeans to sowing cotton.
Double cropping of maize is still possible, although the production cycle will be delayed by about a month, leading to more challenges at the end of the breeding phase. Growers who choose to grow cotton, an expensive and technical crop, in central Brazil, rely heavily on the weather forecast for the coming weeks. It is estimated that rainfall will accumulate over much of the Midwest at 13 to 18 inches, which is half the amount of rainfall in a neutral year (i.e., when there is no El Niño or La Niña).
For most (risk-averse) growers, high temperatures and drought in the Midwest and wet conditions in the South have led to delayed planting. Official national data on Nov. 25 showed that 75 percent of the soybean crop had been planted2%, compared to 86% in the same period last year. This is also the slowest sowing rate since 2015 16. Research institutes and consulting firms have adjusted soybean yields** due to damage to plots due to heat and drought, the conversion of farmland to cotton, and the delay in planting, with soybean yields expected to be reduced by about 13%。Despite this, Brazil's soybean production is still expected to exceed 1600 million tons, an increase of 3% compared with 2022 23.
The delayed planting of the first crop has also led to a reduction in the expected corn production in 2023 24 due to a delay in the harvest schedule by about a month. This delay, combined with the trend of Chicago corn in May and July 2024 and the high fertilizer level through October, resulted in a 9% decline in corn production** from the previous season5%。Favorable weather conditions for double corn cropping in the Midwest, attractive commodities**, and new** opportunities with China have made Brazil the largest corn exporter last season – a situation that is unlikely to be repeated in 2024. However, total corn production is still expected to exceed 11.3 billion tonnes target. The official report in January will undoubtedly revisit their initial speculation.
When it comes to food logistics, climate change and weather uncertainty are putting pressure on Brazil, just as they are affecting the United States. While the Amazon basin has grown in influence, transporting about 24% of the country's soybean exports, the drought associated with El Niño has lowered Brazil's water levels. At the beginning of November, the Madeira River was forced to sail at a third of its deadweight.