It’s “Outback Bob” reporting back to Iowans after spend two weeks in the southern hemisphere.
Last Sunday our 60-plus degrees felt great. With Tuesday’s heavy rain and blustery weather it seems like we had slipped back into late winter. Tomorrow two of us have to head west to near Aberdeen, S.D., to put on a few meetings and we get to look forward to driving into another blizzard.
The good thing that has occurred is that grain prices have staged a mini-rally and taken Chicago Board of Trade grain prices closer to break even than we have seen for over a month.
What seems to be driving the markets now are events in Argentina, including their drought and governmental action.
Over the last six years we have gotten to know a few Argentine producers very well. Their unabashed thoughts were that their government was an incompetent, parasitic, thief. In other words exactly what we now think of our politicians and investment bankers.
In addition, there are taxes as high as 35 percent assessed when the grain is sold. How would any producers here like such action?
It was a very trying year for Brazilian producers. They were buying many of their inputs in the world markets and they were priced high just like ours. Their main saving grace was that much of their phosphate comes from Tunisia and Morocco rather than Tampa. They didn’t have the storage capacity to lay in a huge supply of high priced material, thus don’t have that hanging over retailers and customers’ heads.
Soybeans are still their major grain crop, but the mix seems to be changing as the acres devoted to cane and trees are increasing. The cane will be processed into ethanol and burned in their huge flex-fueled fleet.
The tree acreage includes eucalyptus for use in drying the soybeans and potentially for electricity production.
Brazil’s combination of warm weather and ample rainfall gives the trees the highest growth rate of anywhere in the world. The potential exists in Matto Grosso for the planting of up to 10 million acres of trees. Because many contrarian money advisors are recommending that timber is a wise investment for the future, their growers and European investors are following such advice and now planting the seedlings.
The conditions of the roads in Matto Grosso are much improved over five years ago. Five years ago the 200-mile trip from Cuiaba to Sorriso took 10 hours to traverse, where one had to constantly swerve into the ditches to miss the semis that were swerving into our lane as they were dodging the 10-foot-wide by 2-foot deep chuck holes.
This year the holes were patched, but the semis were still roaring past every 7.7 seconds. The trip to Rhondonopolis was similar to speeding through an obstacle course at 110 mph. Having driven on the Autobahn was perfect training for driving their roads.
As far as this year’s crop in Brazil the growers are not expecting to meet the bushel amounts that are being reported. With their lighter soils the two to three week long droughts in December and January hurt the grain fill of the October planted beans and it hurt the growth and height of the December and January planted crops.
The fields I walked didn’t have an abundance of pods. And similar to what happens in Iowa, the low expectations due to the falling grain prices caused growers to be pessimistic and not spray for diseases when they should have.
I did have the chance to walk through and study the new Inox bean varieties. Inox is Portuguese for stainless steel and everybody knows what stainless steel doesn’t do that mild steel does.
The crops and farmers in this country just endured their driest La Nina season in 50 years. The estimate is that 60 percent of the crop acreage was affected. We saw good areas where the bean plants were over knee high and looked like 50 bushel beans were likely.
In the dry areas many of the beans were between 5 and 12 inches tall. Five to nine podded nodes were most common in those areas. In the worst areas the farmers either harvested or are expecting to harvest nothing. That is very tough to view and even tougher if those are your acres, especially when crop insurance doesn’t exist in your country.
A big interacting factor in determining whether you have good or bad crops is when they were planted. December and January were very dry. If you had planted your corn or beans in October when the rains started, their grain fill was nailed by the dry weather at filling time. If you were lucky enough to have held off until December and the plants were pollinating or filling kernels or pods during the moist February, the ear and pod fill looks much better.
If you hear official pronouncements that the February rains resurrected yield projections, don’t believe them. A lot of growers gave up on controlling insects and diseases and those biotic factors took a tool.
In addition the thrip population increased dramatically and even two to three applications of Lorsban or pyrethroid mixes didn’t control them. Thus many fields had a very bronzed look with leaves that were curled, leathery, and yellowed.
Given a choice between aphids or thrips, I would take aphids any day. This warm climate allows greater insect survival than our -30 degree temps do.
The other 40 percent of the country not affected by drought will have good yields, but with the grain fill still affected by the many 95-plus degree days.
We greatly enjoyed the trip, but it was also great to get home.
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