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S. America weather upsets soy crop yields
by Staff Writers
Buenos Aires (UPI) Nov 13, 2012

disclaimer: image is for illustration purposes only

Weather is upsetting expectations of crop yields in Argentina, Brazil and neighboring countries, all of whom depend on commodity exports for significant parts of their export earnings.

Flood conditions in Argentina and continuing drought in central Brazil are blamed by agriculture officials for canceling out projections made earlier in the year for production of key agricultural crops, including energy feedstock.

Meteorological experts warned of the impending weather vagaries earlier in the year and agriculture data analysts called for contingency measures in both affected countries, but response has been slow, particularly in Argentina.

Argentine President Cristina Fernandez de Kirchner is facing rebellious factions within usually loyal echelons of the political establishment. Protests over government policies paralyzed central Buenos Aires for a day last week.

Soy crop yields are particularly exposed to the weather changes, with predictions that excessive rainfall may slice up to 6 million tons off Argentina's expected yield of about 56 million tons.

Oil World forecasting service, which has headquarters in Hamburg, Germany, said Argentine and Brazilian grain and oilseed production prospects have deteriorated.

"Although it is still early in the season, there is now a higher risk that initial estimates of a sharp increase in soybean production by 36 million tons or 13 percent will not fully materialize, partly because the anticipated increase in the area will not be accomplished," Oil World said on its website.

Very heavy rainfall is resulting in alarming soybean planting delays in several major areas of Argentina as well as in southern Brazil, Oil World said.

ISTA Mielke GmbH, publisher of Oil World, analyzes global supply, demand and price outlook for oilseeds and oilmeals.

In Brazil, in contrast, soybean crops are suffering from lack of water. The soybean-growing states of Mato Grosso, Mato Grosso do Sul, Goias and Minas Gerais have very low soil moisture.

Data for crop yields in neighboring countries weren't immediately available but published reports say the adverse weather conditions will impact on crop yields across the board.

Traders say uncertainty over Latin American harvests may increase international market dependence on U.S. suppliers, especially for soybeans.

Brazil is the second largest producer of soybeans followed by Argentina. The United States maintains the lead in soybean production but weather conditions have affected some U.S. crops as well.

Brazil harvested a record corn crop of nearly 73 million tons surpassing its soy output for the first time in a decade.

In other crop yields the outlook remains mixed. Drought conditions in the U.S. grain belt have affected corn yields, driving importers toward Brazil, especially for ethanol feedstock.

Drought conditions in Kansas, Nebraska, Oklahoma and Texas have expanded, data from the U.S. Drought Monitor indicated.


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