El Niño Threatening Brazil Crops - Monday, 21 December 2015

The Christmas holiday will shorten the market trading days this week.  The markets in the U.S. will be closing at 12:00 CST this Thursday and remain closed all day Friday, December 25th, Christmas Day.  Most markets in Europe, Canada, Australia, Hong Kong, Brazil and Mexico will also be closed for the holiday.

Informa has updated their previous estimates for the 2016 Corn and Soybean acres.  The U.S. 2016 corn acres were previously estimated at 90.1 million that number has been lowered now to 88.93 million acres.  Soybean acres were also reduced from 85.3 million acres down to 84.54 million acres.

The U.S. has been enjoying for most of the month of December a large-scale atmospheric pattern which has brought in a southwest wind flow and warm air from the tropic to regions of the central and eastern U.S.  So far this month over 2,400 daily record high temperatures have either been tied or broken in the first 17 days of the month.  Forecasters predict that the southeastern portion of the U.S. will likely have the warmest Christmas Day ever with temperatures expected to climb to those normally found during late October. 

A recent headline read, “The world’s hottest year just keeps getting hotter” and the month of November was no different, it was the warmest on record globally.  The months of October and November were each more than 1.8 degrees F above the baseline used by NASA and November actually marked the 7th month consecutive month that global temperature records have been broken.  All of this warmth has effected the Arctic Sea ice also which now is at one of its smallest sizes in 36 years.




The strong El Niño that is breaking global temperature records is causing major weather issues for Brazil crops.  The country has seen two very different climates this growing season with northern crop regions experiencing drier and hotter conditions than normal while southern regions have been wetter than normal.  The hot and dry conditions in Mato Grosso has caused poor germinations and decreased plant populations.  In the central region of Mato Grosso estimates are that nearly 10% of the soybeans have been replanted with some even being replanted 2 times.  Brazil’s safrinha or second crop corn is also in jeopardy for the 2015-2016 season due to the poor growing conditions.  According to the Mato Grosso Institute of Agriculture Economics, Mato Grosso which is one of the key growing regions in Brazil is forecast to see an 8.23% drop in safrinha yields for the current season. The map below shows the percentage of the soybean crop grown in each region and as you can see the northern areas that are the driest normally produces close to 50% of the countries soybean crop.  


Each of us at Ag Performance would like to wish all of you and your families a

Very Merry Christmas!!



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