drought / frost will curtail Brazilian crops in Minas Gerais15Stanmore wrote
15 Stanmore wrote
The Company is clearly providing financing to its farmer customers by way of generous terms on the upfront fertilizer costs, waiting for crop sales to have the cashflow to pay the outstanding AR to Verde.
That is if they have a crop to sell.
Drought and frost have lowered crop expectations by up to 60% in many areas
https://reliefweb.int/report/brazil/gdo-analytical-report-drought-centre-south-brazil-june-2021
Drought is affecting central-southern Brazil (including the states of Minas Gerais, So Paulo, Paran, Mato Grosso do Sul) and parts of Paraguay and Bolivia, an area roughly corresponding geographically to the Paran basin. With shrinking reservoirs, hydropower production is at risk, with potential cascading effects on the whole economy of these countries. Crop damages have been reported from Brazil and more impacts on the primary sector are expected in the coming months. Ecosystems, including those of Pantanal (the largest tropical wetlands area in the world), are also affected. Brazilian authorities have declared drought emergency for the Paran Basin until November 2021.
A lack of precipitation during most of 2021, combined with the marked deficit accumulated during 2020, has led to the current dry conditions, as reflected both by groundwater levels and soil moisture. Some locations (e.g. eastern So Paulo state) received nearly half of the expected rainfall during this period. Deforestation of the Amazon, global warming, and La Nia, in addition to natural inter-annual variability, are considered to be the main drivers of the increasing incidence of drought that has affected the region in recent years.