Argentina Expects Dry Weather
- The forecast for the next week does not show much precipitation in key summer crop areas in Argentina.
- The chance for significant rainfall across the nation’s most important growing areas is not until March 13.
- The latest soil assessment for Argentina shows growing dryness in the topsoil.
- Daily high temperatures in the upper 80’s and 90’s Fahrenheit will accelerate the drying rates
- Crops in drier areas in the south and east are experiencing some stress.
- As long subsoil moisture is favorable, crop development may be stressed, but production potential has not been seriously impacted.
FBN’s Take On What It Means: This week’s stress is likely to begin eroding yield potentials. The need for greater rainfall is growing as soil moisture deficits increase. If expected rains fall by mid month, they may be in time to stabilize yields and production potential. We expect the continued weather risk to be a supportive factor for prices.
Brazil Crops Continue to Lag
- DERAL reported Parana corn planting progress at 28% versus 11% last week, but still behind the average of 62%.
- Conditions were slightly better at 72% good to excellent compared to 71% last week and 94% last year.
- Parana soybean harvest remains slow at just 23% complete, up from 8% last week, but still well behind 54% done last year.
- Harvest is still over two weeks behind average and is hindering safrinha corn planting.
- IHS Markit (Informa) lowered its Brazil corn crop forecast to 108.6 million tonnes from 109 million previously versus the USDA forecast at 109 million.
- Markit’s most recent soybean crop forecast for Brazil was 136 million tonnes compared to the last USDA projection of 133 million.
- Brazil’s weather forecast calls for near to above normal rainfall over the next 10 days.
FBN’s Take On What It Means: Producers have made some progress harvesting beans trying to get ahead of more rain in the forecast. Late planting of second crop corn continues to be a concern in Brazil, as there is an increasing chance that corn yields could fall below the normal. Brazil’s dry season may need to be wetter than normal to support production potential, which will likely continue to keep risk premium in the market.
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