May 21, 2024

Rio Grande do Sul Struggles With Aftermath of Historic Flooding

Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.

Emater reported late last week that farmers in Rio Grande do Sul in southern Brazil have harvested 85% of their 2023/24 soybeans which represents an advance of 7% for the week. The average for this date is 95%. There was less rainfall last week allowing for a few short windows for harvesting. Emater estimates that most of the 15% of the soybeans that are left to harvest in the state will be abandoned because the yield and quality of the seed would be so low that it would not cover the cost of harvesting. At the start of the growing season, the state was expected to produce 22 million tons of soybeans, so if the last 15% went unharvested, that would equate to a loss of 3.3 million tons.

The greatest losses are expected in the central, southern, and western parts of the state where the harvest was least advanced. Most analysts are estimating soybean losses in the range of 2.5 to 3 million tons. At the start of the growing season, the state soybean yield was expected to be 3,329 kg/ha (49.6 bu/ac) with a total production of 22 million tons. In their May report, Conab estimated the state's soybean yield at 52.8 sacks per hectare (47.2 bu/ac) with a production of 21.43 million tons.

What is still uncertain are the losses from flooded grain storage units. Rio Grande do Sul is the state with the greatest number of grain storage units in Brazil at 4,800. Many of those silos were manufactured by Kepler Weber at Panambi, Rio Grande do Sul and the company is warning that decomposing grain in flooded silos can produce flammable or toxic gases that can be explosive.

Kepler Weber emphasized that a certified engineer should inspect any flooded grain silo and that they will send out one of their engineers to inspect any of their silos for the next 60 days. They indicated that a flooded silo could collapse due to the expansion of swollen grain and that farmers should not do anything until the silo has been inspected. Most of the flooded silos are without electricity for ventilation or to run machinery to remove the grain. After inspection, Kepler Webler recommends that a flooded silo should only be emptied from the top (I am not sure how that would work).

It is unclear how many grain silos in the state were impacted by flooding. Reuters reported that the biodiesel producer Bianchini located in the city of Canoas, suspended operations indefinitely and that they lost an estimated 100,000 tons of soybeans in their warehouse. Other companies such as Bunge and Cargill have reported damage to their facilities. Even if they could empty the silos, many roads and bridges are out making moving the grain very difficult.