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La Nina May Damage Soybean Crops in Biggest Exporters
La Nina may hurt soybean crops in the U.S., the largest exporter, and South America, should it cause a “severe” drought between early August and February, likely curbing yields, Telvent DTN Inc. said. The price of the oilseed had the first gain in five sessions.
“If La Nina shows up in August, yes, it could contribute to damage to the U.S. soybean crop,” said Bryce Anderson, chief agricultural meteorologist at DTN, a provider of market information to 700,000 clients across North America. “It can certainly be a feature that leads to a reduction in the crop size” in Brazil and Argentina, he said in an interview.
La Nina, characterized by colder-than-normal sea-surface temperatures in the Pacific Ocean, can change world weather patterns, affecting crop development. It can cause wetter-than- usual weather in Asia and below-average rainfall in parts of the U.S., Argentina and south Brazil. There’s a high probability for La Nina to develop during India’s June-to-September monsoon season, the weather office said June 25.
Output losses in the U.S., Argentina and Brazil, which make up 82 percent of global soybean output, may end a 13 percent slump in prices in Chicago this year. Prices declined this year because of record crops.
November-delivery futures rose for the first time in five sessions, gaining as much as 0.4 percent to $9.1575 a bushel. The contract, which reversed an earlier loss of 0.2 percent, traded at $9.1425 a bushel at 2:16 p.m. Singapore time.
The market will continue to monitor the changes in the weather pattern and price in potential risks for losses to global output, Peter McGuire, managing director of CWA Global Markets Pty. said by phone from Sydney.
“When you’re dealing with Mother Nature, you’ve always got those issues as far as the weather is concerned,” McGuire said.
Soybean planting in Brazil, the second-largest producer, may be delayed by dry weather caused by La Nina, the Sao Paulo- based forecaster Somar Meteorologia said June 23. The sowing season runs from September to November.
“The critical time frame for the soybean crop is pretty much during February” in Argentina and Brazil, and early August in the U.S., when plants are most susceptible to heat, DTN’s Anderson said in a phone interview from Nebraska on June 25.
La Nina may bring more rains to northeast China, boosting the nation’s soybean output, he said.
The weather pattern may damage crops in other parts of Asia should it arrive during the monsoon season, bringing heavier rainfall and flooding in growing areas, he said.
Rains in the June-September season in India, Asia’s biggest soybean-meal exporter, may be 102 percent of the 50-year average, more than previously forecast, because of La Nina, the country’s weather office said June 25. Showers would be 98 percent of the long-period average, the office said April 23.
The U.S. crop may also sustain heavier losses should the weather pattern come during the northern hemisphere summer, causing heat stress to the crop as drier weather depletes soil moisture, he said.
Still, “forecast models” indicate a weak La Nina event, which may not cause much damage to global soybean production, Anderson said. “Things are looking fairly promising if there is a weak event,” he said. “Right now, truly I don’t think that anybody can say for certainty when La Nina is going to start.”
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