Mato Gross soybeans replanting concerns grow on dry weather: sources

New Delhi — Mato Grosso soybeans farmers are expected to replant more acreage of the crop in coming days amid dry weather conditions, market sources told S&P Global Platts Dec. 1.

Brazil's top soy producer, Mato Grosso has been receiving sporadic rains in the past few days, coupled with high temperatures, which is not ideal for the planted soybeans crop.

Dryness increased across northern and central growing areas in Brazil, maintaining stress on corn and soybeans, weather agency Maxar said Nov. 30. Dry weather conditions are expected to continue at least for the next six days, it added.

According to Mato Grosso's official reports, soybean replanting has already begun in the state.

If the dry weather persists in the state for the coming days, soil moisture could decline significantly, and so the replanting percentages could rise even further, market sources said.

Mato Gross soybeans farmers are expected to replant 2.51% of the projected area for 2020-21 crop year (September-August) on prevailing dry weather conditions, state's agricultural agency Instituto Mato-grossense de Economia Agropecuária, or IMEA, said Nov. 30. Due to irregular and low volume of rainfall in the state, soybeans crops, particularly the early planted ones, have not developed properly, IMEA said.

Dry weather has severely impacted the soybeans crop development in the state's western, north-west, south-east, center-south and some parts of the mid-north regions, the state agency added.

Soybeans crop requires abundant rainfall and high soil moisture content during planting and crop development stages, meaning dry weather slows the process, even leading to crop damage.

Echoing IMEA's worry, agricultural consultancy AgRural voiced similar concern.

The states of Mato Grosso and Parana -- top two soybeans producers -- were a concern due to lack of rains in recent days, which could impact the development of planted soy crop, AgRural said Nov. 30.

Soybean planting in Mato Grosso has touched 99.65% of the projected area of 10.3 million hectares which is at similar pace compared to last year and above the five-year average, IMEA said.

Mato Grosso's soybeans output forecast has already been revised down 1.06% on previous estimate to 35.49 million mt for 2020-21 by IMEA. This forecast could be revised down if the dry weather prediction turns accurate.

A lower output forecast for Mato Grosso soybeans production is expected to provide some bullishness to US soybeans futures prices, which are already trading at a four-year high, analysts said.

US soybeans January futures prices were trading at $11.73/bu at 10:30 am CT on Dec 1.