La Nina seen hurting grain crops in Brazil, rains delay soy harvest

Credit: REUTERS/Reuters Photographer

Updates with BofA report on La Nina

SAO PAULO, Jan 7 (Reuters) - The La Nina climate phenomenon affected Brazilian soy and corn crops last year and could harm production this year again, according to a Bank of America Securities research note.

It said the 2020/21 season has brought opposite climate conditions for Brazil's regions: The Center-West and Northeast have suffered from heavier rainfall while the South has been hit by drought.

"We thus see downside risks to current estimates for Brazilian grain supply, which could be supportive of grain prices," the report said.

According to the bank's analysis, soybean production in the southern region of the country could be 8% below expectations, while corn production could be 5% smaller than expected.

Drier weather in the Center-West, like in Mato Grosso, however, would be welcome in the next few weeks so farmers can start harvesting without leaving the crop on the field for too long.

Patria AgroNegocios consultancy said on Friday that excess rains in Mato Grosso state are hindering the start of Brazil's 2021/22 soybean harvest, which by Friday had reached only 0.20% of the country's total planted area.

That is below the historical average for the period, of 0.37% of the planted area, though it is better than last year when the harvest was delayed by slower planting.

Mato Grosso is Brazil's main soy producing state and rain has been preventing farmers from entering fields with their harvesters.

"Operational capacity is enormous for this 2021/22 season. But the harvest is not viable for the time being," the consultancy's director Matheus Pereira told to Reuters.

"Excess rain will be a major complicating factor until January 12," Pereira said. Until then weather maps continue to show a very humid pattern for a large part of Mato Grosso.

(Reporting by Roberto Samora and Carolina Pulice; Editing by Sandra Maler)

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