Brazil farmers struggle as drought batters southern soy crop

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SOLEDADE, Brazil, Jan 12 (Reuters) - Soybean farmers in southern Brazil are reeling from a prolonged drought that some expect to wipe out up to 90% of their harvest in some fields unless the outlook for scarce rain changes soon.

In soy-growing regions of Rio Grande do Sul, the first Brazilian state to plant soy commercially and still the nation's no.2 soy producer, farmers worry over stunted plants and withered leaves.

"This soy should be 50 centimeters tall," Nelio Lando, a grower in Soledade, told Reuters as he inspected his fields. "It's not even 20 centimeters high, so it will produce nothing."

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December's excruciating heat and dryness led several private forecasters to slash their estimates for Brazil's soy output this year by some 10 to 11 million tonnes to about 133-134 million tonnes. Government crop agency Conab has been more conservative but also cut its forecast on Tuesday for the world's biggest soy producer and exporter.

Some analysts have suggested that strong rains elsewhere in Brazil, including the top-producing state of Mato Grosso, could partially offset losses in the parched south.

But for farmers in Rio Grande do Sul the outlook is dire. Nearby Paraguay and Argentina are roasting under a record heat wave now pushing into Brazil. read more {nL1N2TL2OV]

"The situation is irreversible," said Luis Fucks, a soybean grower and vice-director president of farmer group Aprosoja in the state. "It is all very similar to 2012, the worst harvest in our history."

Fucks estimated an average 35% loss for the soy crop in northwest Rio Grande do Sul, where his farm is located. The whole state may harvest just 15 million tonnes this year, he said, down from an initial outlook of 21 million tonnes.

Anderson Soletti, a farmer from Espumoso, also in the state's northwest region, said an insurance agent estimated he would collect just six 60-kilo bags of soy per hectare, compared to 60-65 bags per hectare in the region last year.

The last good rains fell there in October, he recalls.

With some luck, he said, nearby farmers who waited until December to plant could hope for half of last year's yield, assuming strong rains come soon and last through March.

"For this field there is no more solution," Soletti said, pointing to the below-average precipitation forecast in coming weeks.

He is one of some 140,000 farmers in the state hit by the drought, according to state-backed agriculture advisory body Emater.

Some will have to replant their fields, said Emater director Alencar Rugeri, citing reported losses of up to 30% on some properties in the state.

The rest of the rainy season will be crucial, though.

"We had a drought at this time last year and harvested an excellent soy crop," he said. "But if it does not rain in January and February, then farmers will have nothing."

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Reporting by Diego Vara in Soledade and Ana Mano in Sao Paulo Editing by Brad Haynes and Tomasz Janowski

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