Brazil’s Rio Grande do Sul State estimates loss of US$3.5 billion with drought

RIO DE JANEIRO, BRAZIL – The financial losses in soybean and corn crops caused by the drought in Rio Grande do Sul State may reach R$19.8 billion (US$3.5 billion). The estimate is from the Federation of Agricultural Cooperatives of the State of Rio Grande do Sul (FecoAgro/RS) and considers the Gross Production Value in the 2021/22 season.

In soy, it is estimated that producers will not sell the equivalent of R$14.4 billion. For corn crops, the estimate is R$5.41 billion.

The calculation took into account the initial production expectation informed by the Brazilian Institute of Geography and Statistics (IBGE), the percentage of losses disclosed by the Cooperative Technical Network (RTC) and by FecoAgro/RS, and the average price received by soy and corn producers of the State in the first days of this year.

Last week, FecoAgro/RS released data showing that the crop loss in dry corn was 59.2% and 13.5% in irrigated corn. In soy, the estimated loss was 24%. According to the initial calculation of the IBGE, the production of soy in Rio Grande do Sul will be 20.9 million tons and of corn, 6.09 million tons.

And the “extreme weather” should persist in the State. For the next few days, the weather forecast indicates that there will be an intense heatwave in Argentina, Uruguay, and Rio Grande do Sul, according to Metsul Meteorologia.

In the State, temperatures may approach or even exceed 43ºC, which, if confirmed, would be a new absolute record. The highest temperature in the State to date was 42.6ºC, recorded in the cities of Alegrete and Jaguarão in 1917 and 1943, respectively.

According to Metsul, the intense heat will be a “classic example” of a compound climatic extreme. The forecast is that central South America will have a heatwave amid a picture of strong to severe drought, which could cause fires.

“The drought favors a more intense heatwave and, in turn, the heat worsens the drought. Not surprisingly, the heat records in Rio Grande do Sul occurred when the State was going through strong droughts in those years,” says Metsul.

Highs between 41ºC and 42ºC are expected in the west of the State this week, but they could go beyond 43ºC in the Uruguaiana region. In Porto Alegre and the region, the heat will be higher at the end of the week, according to Metsul, with temperatures around 40ºC or even a little above that.

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