March 27, 2014

Minas Gerais Hit Hard by Hot and Dry Summer Weather in Brazil

Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.

The 2013/14 summer weather in southeastern Brazil ended up being some of the hottest and driest ever recorded. Probably no location was hit harder than the northern municipalities of the state of Minas Gerais in southeastern Brazil. Very little rain fell in the region during the summer months while temperatures soared to record high levels. All the crop and livestock operations in the region ended up being severely impacted.

According to Emater (the Brazilian Extension Service), the dry bean production in the state was expected to be 159,000 tons, but that estimate has now been reduced by 90% to just 15,000 tons. In the northern municipalities of the state, farmers planted 120,000 hectares of corn, but only 99,000 hectares were harvested and the expected corn production in the region has been reduced by 80%. Seventy percent of the soybean and cotton production in the region was also lost as well.

Livestock producers were also hit hard by the adverse conditions. In the northern municipalities there were 3.3 million head of cattle in 2011, but that has been reduced to 2.6 million head in 2014. The reduction in the herd is the result of animal deaths or farmers selling their cattle due to a lack of forage. The drought has reduced the carrying capacity of the pastures in the region by 60%.

The financial losses by the farmers and livestock producers in the region are just now being calculated. The prices for dry beans and milk, two staples of the Brazilian diet, will surely rise as supplies must now be brought in from other regions of Brazil. The region is already chronically short of corn for small livestock producers and withered corn crop will make the situation even worse.

The state of Minas Gerais is also a leading coffee and sugarcane producer in Brazil, but most of the coffee and sugarcane is grown in the southern part of the state where the drought was not as severe. Coffee production is expected to be down by at least 10% this year and the poor health of the trees is expected to impact next year's production as well. Sugarcane producers in southern Minas Gerais are expecting a reduction of 5% to 10% in their sugarcane tonnage.