The tobacco-growing areas in southern Brazil have been severely affected by adverse weather, according to a crop update provided by Kohltrade. In addition to hail, tobacco farmers have had to cope with excessive rains this season, causing plant roots to drown and leaves to develop spots.
Farmers were forced to harvest wet fields. Limited curing capacity will likely produce a higher percentage of mahoganies this season.
Despite an increased planted area, the average flue-cured Virginia (FCV) crop yield in the three southern states is estimated to be 20.5 percent lower compared than in a typical year.
Since weather patterns are not expected to change during the Brazilian summer, industry experts expect the total green FCV volume to be around 475 million kg.
The same weather conditions are forcing air cured burley farmers to collect and hang underdeveloped plants. Many farmers are reporting rotting leaves.
The negative impact on green volume is more than 20 percent, and Brazil is expected to produce around 39 million kg of burley this year. Lower yields will likely affect factory performance as well.
Small traders are already purchasing the new crop at inflated prices. The overall quality of the low stalk is poor due to the high inclusion of house-burned and unseparated leaves.
Historically, Brazilian rainy crops result in good-quality upper stalks, however. Alkaloid tests in early areas are showing lower nicotine levels, as expected.
In December, some companies began purchasing FCVs, while others began purchasing burleys as early as November. Farmer associations predict an increase in the cost of green product of more than 10 percent.