Brazil braces for major livestock losses following record floods

As a result of floods in the Brazilian state of Rio Grande do Sul, the country is expecting livestock losses amounting to nearly half a million dollars, according to the Brazilian Confederation of Municipalities. Hog and poultry producers are most affected because the floods were particularly bad in the state’s urban areas and their surroundings, which is where most of these producers are located.

In Rio Grande do Sul, there are 12 million head of cattle, 573,000 pigs, and 22 million chickens. There is no official estimate on the livestock losses as the state is focused on serving people who need shelter and reestablishing water supplies. Meatpacking facilities in the Porto Alegre and Caxias do Sul regions are not able to operate yet, according to the Brazilian Association of Animal Protein. More than 2 million pigs used to be processed each day in these regions. The situation is expected to normalize in the next 30 days, according to the Brazilian Association of Animal Protein.

The Brazilian government has taken several measures to help livestock producers. 

“We are exempting all animal health systems of any requirement for the producer, either being a dairy or animal producer,” said the Brazilian minister of Agriculture Carlos Favaro. 

Among the economic measures, Brazilian farmers will have reduced debt of government-backed programs and emergency access to credit.

Soybean and corn harvest

As Rio Grande do Sul was in the final stretch of soybean harvest, the state’s estimate only went down 800,000 metric tons, according to Conab. The nationwide crop prediction increased by about 1 million metric tons. However, farmers in Rio Grande do Sul assess that the remaining harvest of 5 million metric tons will generate a larger loss than Conab is predicting.

The floods are also impacting processors. Bianchini, one of the major soybean processors and traders in Canoas in the greater Porto Alegre region, sells at least 2.5 million metric tons of soybeans annually. The company’s storage facility was completely damaged by the floods. 

The rainfall in Rio Grande do Sul in the coming days is forecast at 1.9 inches and the river levels are expected to normalize by the end of May, according to meteorology service Climatempo.

Meanwhile, some states in the central parts of Brazil, such as Mato Grosso, are already starting the second corn crop harvest. These areas have the opposite problem; they are facing a lack of precipitation that is expected to continue this week.

In Argentina, harvest work picked up speed as weather improved after heavy rains. Harvest is 71% complete, according to the Buenos Aires Cereal Exchange, with total production reduced by 500,000 tons to 50.5 million metric tons. Corn production remains unchanged at 46.5 million metric tons.