La Nina could be in place by 2024/25 South American planting

The waters of the Pacific Ocean are transiting from El Nino to La Nina. El Nino is characterized by warmer-than-normal water temperatures in the equatorial Pacific while La Nina is characterized by cooler-than-normal water temperatures in the equatorial Pacific. These two phenomena can have a profound impact on the weather and crop production in Brazil.

The impact of these two phenomena are opposite in central Brazil compared to southern Brazil. An El Nino usually results in dryer-than-normal weather in central and northern Brazil and wetter-than-normal weather in southern Brazil. That is what happened during the 2023/24 growing season with record temperatures and dry conditions in central Brazil while far southern Brazil was inundated with record rainfall and flooding.

When La Nina is in place, the impact is opposite with generous rainfall in central and northern Brazil and drought conditions in southern Brazil. That was the situation during the 2021/22 and 2022/23 growing seasons when far southern Brazil experienced very dry conditions.

According to Felipe Jordy from the consulting firm Biond Agro, soybean yields in Brazil are generally positive during La Nina years due to improved conditions in central Brazil even though there may be disappointing yields in southern Brazil. It is the reverse during El Nino years with lower soybean yields in central Brazil.

Jordy analyzed Brazil's soybean production from the 1976/77 growing season through 2023/24 (47 years) and concluded that during years with a La Nina, either weak or strong, nationwide soybean yields surpass the previous year even though yields may be disappointing in southern Brazil.

The situation in the Pacific Ocean is in transition and the National Oceanic and Atmospheric Administration (NOAA) estimates there is a 49% chance of La Nina by June-August and a 69% chance by July-September. The chances increase to 80% by September-October when farmers in Brazil will be planting their 2024/25 crops.

If the forecast verifies and a La Nina is in place for the 2024/25 growing season in Brazil, soybean yields in Brazil are expected to be much higher than they were during the disappointing 2023/24 growing season.