Flooding from torrential rains are behind us now at the farm. Over the first 20 days of May, we registered 600 mm of rains while the annual historical average is 2,040 mm. Soils were completely saturated with water. The good news is that the irrigation system channeled the excess water and drained most of the soil quickly.

A month ago, the level of the water at the main pumping station was up to the hand of Lucio, our farm manger.

Due to the velocity and pressure of the water, we had to replace some concrete pipes of internal roads by others we had in stock.

The roof of the master house of the farm, which was not of the most recent, was also affected and we had to replace it as you can see.

In some secondary drainage channels, we are consolidating inclination and wall thickness as part of the ongoing maintenance but we have before to dry the excess water to allow the access to machines.

This period of the year is always dedicated to maintenance, and channels as well as the reservoir should be almost empty which is not the case is as you can see. Overall general maintenance is delayed and remains affected due to this excess water but we will make it.

As harvest was over and production stored in our silos, we have no damage on production to report contrary to other producers (some neighbours had not completed their harvest when the flood started). For those who stored their production in silo bags, situation is also complicated as production was lost or damaged. Our silos provide convenience, safety and security to our production. Overall, certain people might consider us lucky as other activities (soybean, corn, cattle, etc) are more heavily impacted by the situation.

Now, we have restarted to deliver our paddy rice to our clients to fulfill our contracts. Over 5,000 tons have been delivered and 4,000 tons remains to be sold; local rice prices have increase in comparison with the latest cycle (between $160 and $165 per ton to start) but Brazilian market is slow and down in term of price due to Real currency.

Next step, we are soon going to start with land preparation of the fields. Land preparation is important to ensure that the rice field is ready for planting. A well-prepared field controls weeds, recycles plant nutrients, and provides a suitable soil surface for direct seeding.

Over 40,000 Paraguayans have been forced to evacuate their homes so far due to rising waters. Torrential rains continue to swell rivers and cause floods. More than 11,000 people have been evacuate in the capital of Asuncion since May 4, 2019 and Paraguay declared a state of emergency in the province along the border with Argentina.

At the farm, which is located in the South of the country (330 Km from Asuncion and 100 Km from Encarnacion), we are also suffering from the heavy rains and facing floods in some area. Between May 5 and May 6, we have registered 335 mm of rain. Soils are completely saturated with water.

As a direct consequence, the access from the main road to the farm is impossible and we had to post pound rice delivery to our clients as trucks cannot enter or exit from farm. Channels and fields have to be drained again (they should be empty currently to perform maintenance). Internal roads are also affected as well as the main water pump station (the pumps are removable via a lifting system and electrical system are on the upper floor).

Ongoing activities are all delayed as long as water drains off. However, no serious material damage has to be reported so far (harvest was completed and safely stored in our silos) and all the personal living at the farm or nearby is safe which is the most important. Certain people might consider us lucky as other activities (soybean, corn, cattle, etc) are more heavily impacted by the situation.

Harvest is now completed and the final plots where harvested on April 16^th. Drying process of the production is almost completed to. It is the most critical operation after harvesting a rice crop. Drying reduces grain moisture content to a safe level for storage. When rice is harvested, it will contain up to 25% moisture. High moisture level during storage can lead to grain discoloration, encourage development of molds, and increase the likelihood of attack from pests. Therefore, any delays in drying reduce grain quality and result in losses.

Based on preliminary results, around 11,000 tons of paddies have been produced for this campaign with a high index of quality (58 to 60%). We are pleased with those preliminary results given the dense rainfall season registered (please refer to previous post), the low number of brightness days registered during the growing period  and low temperature recorded during the growing period of the plants (in relative).

The second lesson is that for this season, opening market price were better than past seasons – we cannot say good but just better (in the range of $170/t for standard quality – farm price). We have started the delivery of our paddy rice to local mills for the export market mainly to Brazil.

In order to free ourselves from Brazil, we are also trying to open new export market.

Rice harvest has restarted at the farm. Among the 1,500 ha sowed, we have harvested 540 ha so far, providing a dried yield of 6.8 t/ha with a high quality index (60).

Above the standard quality index of 58, buyers value the quality via an incremental price premium on the market reference price.

Although weather conditions have disrupted our productivity in terms of expected yield, the average national yield is around 6.7 t/ha according to the President of the Paraguayan Chamber of Rice (Caparroz) who judges the campaign “good”.

“Article from La Nacion, dated 02/03/19”

The latest plots sowed still need 10 days of irrigation (around 350 ha), while harvest continue for the remaining surface.

Rice harvest has begun for the 1^st plots sowed in September 2018 (sowing took intentionally place in stages in order to get a sequencing production).

Among the 1,500 ha sowed, we have harvested 290 ha so far, providing a dried yield of 6.5 t/ha with a high quality index (above 60). This preliminary yield, 13% below our production target (7.5 t/ha dry), is due to the excess rainfalls registered during the first 30 days of vegetative stage of those plots. Excess water during the vegetative phase hinders tillering (emergence of stems or tillers from the strand, and each stem will give an inflorescence) and therefore the yield of the plants. However, we need to add some nuance given the high quality of grain we get after drying process as the standard is an index quality of 58 (paddy rice prices are set up at this level, and discount are applying for lower quality). This result has been achieved thanks to precision harvesting and drying.

For now, this production is stored in our silos, waiting for good market opportunities.

Meanwhile, we continue to irrigate the other fields by using water from our artificial as low rainfalls occurred and the level of the river decreased.

Harvest will restart by end of February/March as around 80% of the production remains to be harvest.

Rice cultivation performed at Salitre Cue is a step-by-step production until harvest and post-production activities took place. From the moment land is being prepared until harvest is taking place 9 months elapse.

The fields are currently in the peak period of irrigation which takes around 90 days and 1,500 hectares are under irrigation as you can see.

Paddy crop is strongly influenced by water supply and water should be kept standing in the field throughout the growth period. Continuous flooding helps ensure sufficient water (elimination of moisture stress and favourable micro-climate to crop production) with greater availability of nutrients such as phosphorus, iron and manganese and control weeds.

You can see the quality of the taipas build thanks to Real Time Kinematic (RTK) technology using GPS guidance (dig irrigation channels build around the edges of the field with the tractors on autopilot).

You can have a complete overlook of the adjusted irrigation system, fully operational. Water is being pumped directly from the river Tebicuary from our main pump station and being redistributed in the irrigation system. In case of low level of the river, our artificial lake of 480 hectares size full of water.

While we are in the sowing peak, continuous rains keep slowing down rice planting progress. After having faced some water shortage (low river level due to lack of rainfall in southern Brazil) and dry soils from the summer period, all crop farmers have to deal with the opposite situation now. In September, we registered 185 mm of rain (+44% compared with the historical average of the month) and already 226 mm as of October 18.

For rice sowing, the problem is not so much the amount of rain but its frequency. In September, we had rain every 3 to 4 days and the trend is the same so far for October where heavy rains are providing in a short period of time (from 2 hours to 1 day) a very large amount of water (100 mm or more).

After heavy rainfalls, we need 48 hours to drain the plots

Rice sowing requires dry soils so after each rain, we have to wait until the land dried and allows sowing. This induced very slow advances in sowing. However, we are still in the optimal sowing period until end of November and knowing that in optimal conditions, we have a daily sowing capacity of 80 ha.

Our situation is not unique and according to preliminary estimates of the Paraguayan grains and oilseed traders association (Capeco), the heavy rainfalls registered should reduce at least by 25% wheat harvest and soybean seeding could not started yet given the high soil humidity.

For the 1st plots already sowed, herbicides and nitrogen were already applied (nitrogen is the most important nutrient for rice productivity as it encourages the vegetative growth of paddy). You can see emerging the seeds and taking benefit from the natural irrigation supplied by rainwater.

Following the closing of our latest harvest and as mentioned previously, we took advantage of this time to perform some adjustments and maintenance in the irrigation system as rice is a culture of precision. The aim of those adjustments are to optimize water flow while reducing as much as possible water losses and electricity consumption required to pump and distribute water in the fields. You can find below some sample of the work which has been performed. In parallel, we moved forward with all pre-sowing requirements (land preparation, seeds, levelling of the taipas, purchase and import of high quality seeds, etc).

Resize of the irrigation pool at the water re-pumping station where we added also in back-up a 2^nd pump coming from the main pump station

Irrigation channel #5 which has been upgraded

New electricity lines and power transformer installed at water re-pumping station

Progressive water filling of the artificial lake (468 ha size) dedicated to store water in case of low level of the river

Cleaning of the water channel access from the river to the main pump station

On September 10, we began with the sowing period. Our objective for the cycle is to sow around 1,600 ha and so far, only around 400 ha have been sowed due to repeated rain events. Rice sowing requires dry soils so after each rain, we have to wait until the land dried and allows sowing.

Furthermore, we choose not to extend significantly our planted surface this cycle given the fact that Brazil plans to reduce its imports by protecting its internal market. Brazil reactivates domestic support programs:

Over the years, Brazil has used various domestic support programs when corn, wheat, and rice commodity prices are low, and for the first time since 2011, they have authorized the use of two programs for rice: Premium for Product Outflow (PEP) and Equalization Premium Paid to the Producer (PEPRO)

The purpose of these programs is to move commodities from high producing areas to any of the ten grain-deficient states in the north of Brazil. The program is not prohibited from fuelling exports, however when used this way, it is a World Trade Organization (WTO) violation and Brazilian rice enjoys a clear and unfair advantage.

The programs are similar in nature in that the Brazilian government guarantees a minimum price to producers by paying the difference between the prevailing market price and the government-established minimum guaranteed price, either to the commercial buyer (PEP) or directly to the producer (PEPRO).

As most of our paddy rice production is ultimately sold to Brazil, we decided not to increase significantly the sown are (≥ 2,000 ha) and maintain our so called “base planted area” of around 1,600 ha.

For now on, the 1st plots sowed have already seed emerged as you can see. Arial application of herbicide and fertilizer have also been performed, and irrigation of those plots is imminent.

Otherwise, weather forecasts are not expected to improve during the 1st 2 weeks of October and rains may continue to slow sowing progress of the raining surface.

Fields after several rainfalls occurred during last week of September

This current weather situation is in line with the prediction expressed by the World Meteorogical Organization (WMO) regarding the development of  El Niño phenomenon for our region by the fourth quarter of the year. For your reference, El Nino is a global weather phenomenon which has a strong impact on wind and on water and we hope that the phenomenon will not have the same intensity then in 2016.

On the positive side, the regular rains registered have allowed the water levels rose in the river to their standard levels and contributes naturally to fill the reservoir. However, current efforts of the operating team are focused on the sowing.

While the inauguration ceremony of the new President of Paraguay, Mario Abdo Benitez, took place on 15 August where he announced that his main objective would be to tackle tax evasion and informality, our seeds which we import from Argentina have been delivered to the farm and stored.

Since the beginning, we are intentionally importing our seeds to ensure better traceability and quality. This year production is dedicated 100% to IRGA 424 cultivation over 1,500 ha.

Seed is a living product that must be grown, harvested, and processed correctly in order to realize the yield potential of any rice variety. Good quality seed can increase yields. Using good seed leads to lower seeding rates, higher crop emergence, reduced replanting, more uniform plant stands, and more vigorous early crop growth. Vigorous growth in early stages reduces weed problems and increases crop resistance to insect pests and diseases. All of these factors contribute to higher yields and more productive rice farms.

Good seed is pure (of the chosen variety), full and uniform in size, viable (more than 80% germination with good seedling vigor), and free of weed seeds, seed-borne diseases, pathogens, insects, or other matter.

Choosing seed of a suitable variety of rice that suits the environment it will be grown in and ensuring the seed choosen of that variety is of the highest possible quality is the essential first step in rice production.

Next step will be to full fill our artificial lake of 480 ha with water in case of an extended period of low level of the river. To this aim, we hope that the current low water levels along the Parana river and its tributaries like the river Tebicuary upon which we rely will reverse.

Low water level in the Parana River is causing exporters in Argentina to dispatch vessels without a complete load of grain or other products and increasing freight costs. The summer-long drought in Argentina and a lack of rainfall in southern Brazil is resulting in the lowest water level on the Parana River since 2008.

It takes approximately 30 days for rainfall in southern Brazil to make its way to the Roasrio area. Additionally, the water level in the lower Parana River is also partly determined by the dams and reservoirs on the upper reaches Parana River located primarily in Brazil.