Drought leads to 70% loss in some of harvests in the South of Brazil in the first quarter of 2022
La Niña causes the worst drought in the South of Brazil in 17 years.
The total loss in Soy and Corn production in the worst hit state of Rio Grande do Sul in January reaches RS 20 billion (EUR 3,5 billion), with rice and wheat harvest figures still pending (March/April). Thousands of families lost access to water and subsistence farming has been hit as well, leading to serious threats to food security and people’s wellbeing in the region. Given the size of the area hit by the drought prices are rising influencing also related sectors like livestock. The contrast with 2021 with record production and export figures couldn’t be greater.
The reason for this report in Agroberichten is firstly that prices of commodities could be affected in 2022 because of this development. Where prices of soy already rose sharply in 2021, these negative production figures combined with international historically low reserves could put further pressure on prices. Secondly the drought has led the government of Rio Grande Do Sul to embark on large investment scheme to improve the water infrastructure: building 6,000 dams, 750 wells, install water tanks and implement 500 sets of cisterns in the most affected areas. Cross border cooperation on water management of the largest aquafer in the world, the Guarani Aquifer, could also be more prominent on the agendas of the south of Brazil, Argentina, Paraguay and Uruguay. The NBSO in Porto Alegre is following developments and opportunities coming from this development.