Rain only a temporary distraction for Brazil soya harvest

Brazil has just begun harvesting what could be its largest-ever soyabean crop and although there has been concern over interrupting rains, there is technically no cause for anxiety over the harvest progress just yet. Brazil is the leading global supplier of soyabeans, and those in its top producing state Mato Grosso are among the first to be harvested and reach the export market. As of January 27, farmers in the Center-West state had collected 16.3 percent of the total planted area. This is double the percentage of soyabeans that Mato Grosso harvested by this date last year and it represents just about the largest area cut by this date in at least the last several years.
Still, farmers' statistics body Imea is a bit disappointed with the progress, as analysts there believed that as much as 25 percent could have been harvested by now had it not been for the recent rains, especially given how quickly planting took off last September.
Large soyabean traders may have been thinking along the same lines, as some expected that a much larger than normal amount of Brazilian beans would be available by the end of January.
On Tuesday, data from shipping agency Wilson Sons indicated that a volume of 4.39 million tonnes of soyabeans were at Brazilian ports waiting to be shipped abroad - some 97 percent more than the same date last year.
It is unclear if traders had been expecting even more beans than this, but there is not yet a reason to fear that Brazil's soyabean harvest has been compromised, as both the progress and the outlook are positive for now.
Despite the concern that Mato Grosso's soyabean harvest has been slowed by the rains, the pace is still exceptional -especially when comparing this season's planting and harvest progress against previous years.
The weekly jumps in Mato Grosso's harvest progress over the last three weeks are near or at the top end of the range compared with the last few years, meaning that harvest is still progressing at a relatively fast rate.
Further, harvest pace stands ahead of the two recent years in which Mato Grosso planted as fast or faster than in 2016/17, and the Center-West state will remain ahead if progress reaches at least 22 percent by Friday.
As an aside, these two quickly planted, quickly harvested years in Mato Grosso, 2012/13 and 2013/14, contributed to the record soyabean production and export campaign that the country comfortably achieved in each of those years.
It is also worth noting that both January 2013 and January 2014 were wetter than 2017 on average across all regions within the state, which should give some confirmation that the recent rains in the area should not be too concerning on the larger scale.
In fact, Mato Grosso opened up a rainfall deficit throughout January 2017, so it is difficult to classify any precipitation received during the month as a nuisance, especially as soil moisture still stands at below-normal levels.
February through April is the key time for Brazilian farmers to be combining soyabeans, which is why the April through June period is when soyabean exports tend to peak, although they do begin in early February as the first beans begin arriving at port.
Mato Grosso - responsible for 30 percent of the national crop - typically begins harvesting in January but does not get into full swing until February. By mid-March, roughly 80 percent of the state's soyabeans have been cut, and the rest lingers on into early April.
Last year, Mato Grosso harvested a bit slower than average throughout the whole season, so comparing this year's numbers against 2016 might be slightly misleading if farmers continue at a fast clip.
In Paran?, the second-largest soyabean producing state at 18 percent of total, harvest progress stands at 1 percent, slightly below the typical 5 percent by this date. In general, just over one-third of the crop is cut by the end of February.
Paran?'s harvest starts a little later than Mato Grosso given the former's southern location, but it starts to catch up toward the end of March, as about 80 percent of soyabeans are usually harvested in Parana by that time.
Rio Grande do Sul, the southernmost state in Brazil, accounts for 15 percent of national production and is the last state to begin harvest. Typically, less than 10 percent of the crop is harvested by mid-March.
Weather is the key driver of how the soyabean harvest will progress, which means it also directly influences the planting of Brazil's second-crop corn - or safrinha - which makes up around two-thirds of the country's total corn output and is crucial to the export program. Brazil is the second-largest exporter of the yellow grain behind the United States.
Forecast models as of midday Tuesday are calling for average to slightly below average rainfall in Mato Grosso for the next two weeks, which should help the soyabean harvest progress while also providing enough moisture to get the safrinha going. Mato Grosso is the key producer of safrinha corn in Brazil, accounting for roughly 40 percent.
The next week looks a bit on the wet side for Parana as farmers there begin to move into the fields, but week two should be a little drier and will come at a good time for the harvest there to pick up momentum.
Additionally, Paran? is the second-largest grower of safrinha at 24 percent of total. So as long as farmers are able to make some decent progress on soyabeans over the next couple of weeks, the state's safrinha planting should not be in danger.
Over the next couple of months, the evolution of Brazil's precipitation forecast will be crucial to monitor for both the soyabean harvest and the planting and emergence of the second corn crop. A switch to a wetter outlook could introduce unwanted delays.