Brazil's soybean and first corn crop severely drought-affected
While La Niña took a toll on the wheat crop in Argentina and corn in Brazil in MY 2020-21, Brazil's soybean and the first corn crop are seen taking a severe hit in production in MY 2021-22 due to another drought, S&P Global Platts reports.
The drop in soybean and corn yields in South America is likely to reduce the supply of grain and oilseeds, keep prices firm in the local market and support the global prices in the first half of 2022.
Learn more: Will La Niña Send Grain Prices Higher?
Generally, Southeast Asia, South Africa, India, and Australia receive above-normal rainfall in a La Niña event, and drier weather is seen in Argentina, Europe, Brazil, and the southern US.
"Meanwhile, weak La Niña is expected to continue until Northern Hemisphere spring, with a moderate probability of 77% during March-May, the International Research Institute for Climate and Society said in its latest update," the report reads.
Brazil's second-corn crop sowing has just begun and there is a long way to go before the record output projections materialize.
Following the corn crop losses during the second-corn harvest in 2020-21, the Brazilian government had taken a few steps to increase corn imports.
Having considered crop perspectives in Argentina and Brazil, India purchased 100 thou. t of soybean oil from the US.
Conab cut its forecast for soybean production in Brazil by 15 mln t its February Crop Report.