La Nina Impacts on South American Corn and Beans

This graphic shows the percent that Argentine and Brazilian corn and soybean yields deviate from their 30-year trend on the left axis vs. the yearly average of the Oceanic Nino Index -ONI on the right axis.

The latest three-month average reading is for the Sep-Nov 2020 period with a reading of -1.2 which is the lowest ONI reading since January 2011 which started a strong La Nina year where the year average was -0.8.

The ONI index was 0 as recently as the AMJ 2020 period but has decreased rather steadily from then signifying a strengthening La Nina event.

Looking at the graph one can see that often in a La Nina year, Argentine corn and especially soybean yields come in below trend, sometimes significantly so.

It does appear that Brazilian row crop yields are not as impacted by the heat and dryness associated with strong La Nina events. This should somewhat assuage concern about both Brazil and Argentina having below par corn and soybean crops at a time when the global balance sheet demand the opposite.

Note the correlation between the yearly averages ONI is 39.1% for Argentine corn and a very high 46% for Argentina soybeans whereas for Brazilian corn it is only a 13.6% correlation and a negative 15.6% for Brazilian soybeans. Some of the best Brazilian soybean yields have occurred in La Nina seasons.

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