South America Calling
Alastair Stewart South America Correspondent

Friday 09/14/12

Western Parana Waiting for Rain

The fields have been prepared, the planters are calibrated and piles of seeds and fertilizer sit ready to be deployed. All farmers in the west of the southern Brazilian state of Parana need to kick off the 2012-13 soybean planting season is a bit of rain.

Unfortunately, the September rains that traditionally break the winter dry season have yet to come, and there is little rain in the forecast until late in the month.

"Farmers are itching to get into the fields. A lot of people would be already be planting by the end of next week if there were any soil moisture," said Elo Pide who runs a 720-acre farm in Marechal Candido Rondon in the center of this top-producing region.

The lack of September rain is no disaster for the soybean crop as the ideal planting period runs from Oct. 5 to 25 in the region, and the return of abundant rains is predicted for next month.

The problem is that this region is also a major planter of second-crop corn and farmers need to get the beans in the ground by Oct. 10 to 20, depending on the micro-region, to have time to plant corn in February. If they fail to plant corn before Feb. 20 to 28, yield potential drops rapidly and the crop is more susceptible to frost and drought.

"Farmers are willing to take a risk with their soybean crop to guarantee a second corn crop," said Enoir Pellizzaro, chief agronomist at the CVale cooperative in Palotina.

If rains return in late September, there is still sufficient time to plant both crops on schedule as farmers have invested heavily in machinery in recent years and can plant all their soybeans in 20 to 30 days.

However, farmers are already getting edgy about the prospects for the second crop.

"We have had a number of farmers holding back on buying corn inputs until they know that they will have time to plant well," said Sergio Dalla Costa, commercial manager at the Coopavel cooperative in Cascavel, which receives around 1 million metric tons of soybeans from the region.

Brazilian second-crop corn production was spectacular in 2011-12, topping summer output for the first time amid perfect weather.

Farmers intend to increase area in 2012-13, rain permitting, but it is uncertain whether output will be greater because it is such a risky crop.

"The chances of something going wrong with winter planting are substantial. That's why farmers still invest a little less in second-crop corn than first. You can't count on it," Paulo Brunetto, agronomist at the Copagril cooperative in Marechal Candido Rondon.

And when you consider that margins on second-crop corn are much slimmer than those for soybeans -- 100% pays 5% to 10% says Coopavel -- it seems counterintuitive to take chances on the soybeans.

However, the second crop offers other attractions.

It allows farmers to dilute costs of the summer crop. Much less fertilizer is needed for the soy if corn is deployed in the winter. Meanwhile, the winter crop covers the soil, so important to the success of direct planting, and rotates the crop. Finally, fixed costs, including labor and machinery costs, are spread between two harvests.

So second-crop corn is here to stay in western Parana. Indeed, many now see corn as a winter crop, virtually abandoning summer corn for soybeans despite the agronomic challenges that creates.

(CZ)

Posted at 5:22PM CDT 09/14/12 by Alastair Stewart
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