Southern Brazil, Argentina Seen Dry

Weekend rains provided Brazil’s southern soybean belt with temporary relief from dry conditions, but Argentina’s growing areas stayed dry and weather forecasts call for weather to turn hot and dry again through the first half of January.

Commercial forecaster DTN/Meteorologix said Tuesday that the southern soy growing states of Rio Grande do Sul and Parana could see scattered light showers through Thursday, but will turn hot and dry after that.

According to Reuters News Service, the Rio Grande do Sul-based forecaster Sao Leopoldo Climatology warned on Tuesday: "The drought will return and worsen in the first half of January in southern Brazil. The volume of rain forecast by all models for the next 15 days is very scarce."

It added, "In Argentina, the situation should turn critical where the accumulation of rain will be even less."

Grains analyst Celeres said more rain will be needed in southern Brazil in the next 10-odd days for soybean yield expectations to return to near normal.

Brazil’s No. 3 soy growing state of Rio Grande do Sul “is on the path to another problem crop,” Anderson Galvao Gomes, chief analyst for Celeres told Reuters. "The plants will need more rain if they are to recover most of their yield potential."

However, things are not as bad as a year ago. "Yields in the south look much better than last season, even better than in 2003-04 at this point," said Gomes.

Rio Grande do Sul saw its expected soy crop halved in the previous 2004-05 season due to a severe drought. The 2003-04 crop was also hurt by drought but not so severely.

The No. 2 soy state of Parana has also been struggling with dry weather over the past two months or so. The state's soy farms received 36 mm (1.4 inches) of widespread rain over the weekend, which will help crops, Somar said.

But, like Rio Grande do Sul, Parana is not expected to see more widespread rains for the next 10 days.

Dry weather conditions are delaying the seeding of double-cropped soybeans – which are planted where wheat and other grains were just harvested – in parts of Buenos Aires and Entre Rios, the No. 3 and No. 4 soy-producing provinces, the exchange said.

Editors note: Richard Brock, The Corn and Soybean Digest's Marketing Editor, is president of Brock Associates, a farm market advisory firm, and publisher of The Brock Report.

To see more market perspectives, visit Brock's Web site at www.brockreport.com.