Author Argus

The Brazilian region commonly known as Matopiba registered an impressive boost of soybean productions between the 2012-13 and 2022-23 crops, becoming a new important producing oilseed hub for the country.

But the next 2023-24 cycle could be challenging for the region’s soy crop and interrupt the series of successive production records registered over the past few seasons.

Join Camila Dias, Argus Brazil Country Manager, and Nathalia Giannetti, reporter for the Argus Brazil Grains and Fertilizer publication, as they talk about what led to the expansion of Matopiba’s soybean crop and what can be expected for the 2023-24 season.  


CD: Hello, and welcome to Market Talks, a series of podcasts brought to you weekly by Argus about the main events impacting the commodities and energy sectors in Brazil and worldwide. My name is Camila Dias, Argus Brazil Country Manager. And in today's episode I will talk to Nathalia Giannetti, reporter for the Argus Brazil Grains and Fertilizers publication, about the soybean boom in the Brazilian region known as Matopiba and what we can expect for the 2023-24 crop. Welcome, Nathalia.

NG: Thank you, Camila. It’s a pleasure to be here at Market Talks.

CD: Nathalia, what has happened with this Matopiba region’s soybean productions over the past decade?

NG: So Camila, first, it is worth mentioning that Matopiba is an acronym formed by the initials of the four states that compose its territory: Maranhão, Tocantins, Piauí and Bahia. This is also where a strong agricultural expansion has been taking place since the 1980s. In recent years, Matopiba has emerged as an important producing-pole of soybean in Brazil. In 2022-23, these four states together produced about 20mn t of soybeans. This total is only below the two largest Brazilian soybean producers, namely Mato Grosso and Paraná states. In the 2022-23 harvest, Mato Grosso produced more than 45mn t and Paraná produced around 22mn t of soybeans. Ten years ago, soybean production in Matopiba totaled only 6.8 million t. So volumes tripled in this period. Of course that the national soy production has also grown exponentially in the last decade. But the progress recorded in Matopiba exceeds proportionally the growth of soybean production in other states and regions, with an increase in the share of Matopiba. In 2022-23, the region accounted for 13pc of the record 154.6mn t produced nationally. Ten years earlier, in the 2012-13 crop, Matopiba accounted for 8pc of the 81.5mn t of soybeans harvested in Brazil.

CD: There’s been indeed a pretty significant increase in Matopiba’s soy production. But what happened in the past decade that could explain this growth?

NG: This is actually the result of mainly two combined factors, Camila: the expansion of planted area and the increase of yields, both were also trends registered nationally. This happened mostly because, between 2013 and 2023, Brazilian farmers began to perceive the soybean crop as economically favorable option. The devaluation of Brazil’s real against the US dollar in this period turned the Brazilian soybean much more competitive to export, for example. As a result, farmers began to expand more and more the area sown and increased their investments in fertilizers, pesticides and other agricultural inputs. Weather conditions also weighted positively in the last 10 years. Most of the cycles that followed the 2012-13 season were favored by the occurrence of regular rainfall in Matopiba, which further boosted soybean yields. For example, in the last three seasons, when the weather phenomenon La Niña resulted in the good regularity of rainfall volumes in the region, there was an increase of 4.5 million t in Matopiba’s soybean production. And in the specific case of Bahia state, we can mention the practice of growing herbaceous vegetation between soy crops to maintain soil moisture levels. This contributed to an increase of Bahia’s output, which jumped from 2.7mn t in 2012-13 to 7.7mn t of soybeans last season. Bahia is now the seventh largest soybean producer in Brazil and the largest producer outside the center-south. Bahia’s average yields were also the highest in the country in 2022-23. Ten years ago, the state held the second-last position in the national ranking of soybean yields.

CD: So, can we already expect this growth trend to continue in the 2023-24 crop?

NG: So, Camila, the situation for Matopiba next season is quite complicated. The El Niño phenomenon, which has already shown signs of strong intensity here in Brazil in recent weeks, should cause a period of drought in the region around December this year, which would harm soybean yields in Matopiba. This is similar to what occurred in the south region in the last three seasons, when La Niña caused large losses to soybean production, especially in Rio Grande do Sul state. With El Niño, there’s a reversal of weather patterns. The South is expected to receive a considerable increase in rainfall volumes, while Matopiba, which registered regular rainfall since 2020-21, is expected to undergo a period of drought. The last time El Niño took place was in the 2015-16 season, when production totaled 6.8 million t, a reduction of 3.8mn t from the previous crop. If the phenomenon comes with high intensity again, it is possible that a yearly reduction similar to that one happens.

CD: Perfect, Nathalia. But is there still no certainty that this will actually occur?

NG: Well, Camila, so far, the National Institute of Meteorology predicts that El Niño should range from moderate to strong intensity during the spring and summer seasons here in Brazil. But everything is still very uncertain, this forecast may change until the arrival of the crucial period for soy crops, which is usually from December to February. In addition, Brazil is under the influence of other climatic phenomena and air masses, which could reduce or amplify the effects of El Niño.

CD: Very interesting, Nathalia. Let’s see what will happen next in Matopiba this 2023-24 crop. And thanks for joining us.

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