Brazil Soybean Weather – Introduction
Over the past 20 years, Brazil soybean weather has had important impacts on production. During that time Brazil has become a global powerhouse in the agriculture industry while developing into both a major producer and exporter of agricultural products. If you’ve asked yourself “Which country is the largest producer of soybeans in the world?” and answered “Brazil”, you’re correct. Agricultural production in Brazil has exploded over the past 20 years and its impact on global markets has been significant.
As shown below, Brazil has become the number two producer of soybeans by 2018, according to the UN FAO. Brazil is in the southern hemisphere which means the crop grows during months of the year roughly opposite on the calendar to the US crop season. Just as with the US crop season, “ag weather” conditions can have a significant impact on production on a year-to-year basis. Considering all these factors together indicates that monitoring the conditions of crop growth during the Brazilian crop season provides critical information regarding production totals in Brazil.
Note that in addition to the US and Brazil being top producers of soybeans, Argentina produces the third most soybeans in the world. Soybean production in all other countries is relatively small compared to US and Brazilian production.
Brazil Soybean Weather: Production
Understanding the impact of weather conditions on production requires understanding the Brazil crop calendar, and the regions where soybeans are planted. This is discussed below.
Brazil Crop Calendar
Crop calendars are used to highlight when critical activities occur during a region’s crop season. Those activities are generally planting, growth, and harvesting. The crop calendar above shows Brazilian soybean weather for planting occurs from October to December, the crop growth phase starts in January and harvesting occurs starting in March. So, the time of year that the Brazil soybean weather season is ending is similar to the time the crop season in the United States is just getting starting.
Brazil Soybean Production Map
Although Brazil is geographically a very large country, Soybean production is fairly concentrated in a few regions in the west of the country. The maps above (provided by the USDA) shows the regions in Brazil where soybeans are produced.
Brazil Soybean Production and Exports
Brazil has grown to become a significant producer of soybeans over the past 20 to 30 years, as shown in the above history of soybean production. According to data provided by the UN FAO, Brazil soybean production is now almost equal to soybean production in the United States. differences in Brazil soybean weather mean the increase year over year is not necessarily smooth, the trends of Brazilian soybean production chart above suggest that Brazil will soon regularly produce more soybeans than the United States.
Brazil soybean production is significant. This fact is only important if significant amounts are exported to other countries because Brazilian soybean exports create competition for US grown soybeans. The degree of competition in global markets impacts the total US soybean exports. The impact of total US soybean exports impacts the total amount of soybeans available for sale in domestic US markets. This impact on US domestic supply affects the price of soybeans in the US market. As a result, US winter-time production of Brazilian soybeans can have direct impacts on the price of US soybean via its impact on global soybean export markets.
Soybean exports as a percent of total US production for each year are shown in the chart above. It demonstrates that Brazilian soybean exports have increased to roughly the same percentage as the US soybean exports up to 2017. Both countries exported approximately 40% relative to US production as of 2017. However, in 2018 Brazilian Soybean exports exploded to greater than 60% of US soybean production. Clearly, Brazil has grown to dominate global soybean markets relative to its primary rival, the United States.
Brazil Soybean Yield History
Brazilian soybean yields are approximately the same as those in the United States. There are two primary causes of year-to-year yield variation. The first is the technology trend. The yield technology trend is everything technological working to increase crop yields year in and year out. This includes but is not limited to seed genetics and technology, machinery technology, farming practices. The second cause is weather variations.
Using the Brazil soybean yield history in the chart above, the technology trend is estimated as the linear trend of yields from 1971 to 2017. Removing the linear trend (i.e. the technology trend) reveals the Brazil soybean yield variations over time. These yield variations are caused by different weather conditions during the growing season in Brazil.
Significant variations in year-to-year soybean yield mean that overall Brazilian production can be significantly impacted by growing season weather conditions. Monitoring the weather conditions during the Brazilian soybean season be an important tool for estimating Brazilian soybean production and the impact of exports on global markets.
CropProphet Brazil Soybean Weather Monitoring Solution
CropProphet, provided by Prescient Weather, is a popular tool for sophisticated agricultural futures traders to monitor crop yield predictions and the weather and climate conditions that cause year-to-year variations in yield and production. In November 2019 CropProphet released a content upgrade that offers customers the ability to monitor crop-specific weather conditions in Brazil and Argentina, such as the information below.
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