Drought raises fears for Brazil food crops Driving through Paraná"s lush green hills in the drizzle, it is hard to believe that the southern Brazilian state is suffering one of the worst droughts of the past decade. The view is deceptive, says César Cheida from the Integrada farming co-operative, as he examines a soyabean plantation near the town of Cambará. This isn't rain. It's not even enough to get the ground wet," he scoffs. The crop should be up to his waist by now, but after 40 days of scorching sunshine with only the occasional light shower, the spindly plants barely reach his knees. Weeks of scant rainfall and unusually hot temperatures linked to the La Niña phenomenon have ravaged crops across Brazil and Argentina, which together account for almost half the world's soyabean exports and about 24 per cent of corn shipments. The UN Food and Agriculture Organisation's food index, a gauge of food price inflation, is at about its lowest level since October 2010. But as grain prices rally on supply fears, the emerging world is facing the prospect of another painful bout of food inflation. Conab, the crop forecasting agency of the Brazilian agriculture ministry, says that the country will harvest 71.75m tonnes of soyabean this year, about 4.7 per cent less than last year, as healthy growth in the vast state of Mato Grosso is overshadowed by double-digit declines farther south. That would rank as Brazil's second-biggest yearly decline in soyabean production since 1996, but is part due to the fact that last year's harvest exceeded expectations at 75.32m tonnes. Output has doubled over the past decade to meet soaring Chinese demand, and Brazil now ranks as the world's second-biggest producer behind the US. Independent forecasters in the country are less pessimistic than Conab, however - Agroconsult predicts only a 2 per cent decline in production to 73.52m tonnes and AgRural expects a harvest of 73.06m tonnes. Corn production in Brazil should actually increase by 2 per cent to 36.52m tonnes, according to Agroconsult. Across the border in Argentina, corn has been hardest hit but farmers are also bracing for sharp falls in soya production. The dry weather has destroyed initial hopes of a record total harvest of more than 110m tonnes this season. "It's still early to make a forecast, but I don't think we'll reach the US Department of Agriculture estimates," says Miguel Calvo, president of Acsoja, Argentina's soyabean association. A USDA report last week forecast a 50.5m tonne Argentine soya harvest, down from 52m estimated in December. "We could be talking about 48m [in soya]," says Mr Calvo, who is himself waiting for rain in the coming days to decide whether or not to sow some of his land in the south of the central province of Córdoba, one of the areas worst hit by the drought. Last season, Argentina produced 49m tonnes of soya and 23m of corn, but the corn crop had been expected to jump to as much as 28m to 29m tonnes this year, analysts say. The USDA has shaved its Argentine corn forecast by 3m tonnes to 26m, a level some farmers say could prove hard to reach. Martín Fraguío, executive director of Maizar, which represents corn producers and the industry, estimates that 20 per cent of the corn that could have been sown was not, and that 10 per cent that was sown was lost - though add that some could perhaps be resown. A producer himself, who admits to having had "nightmares about the drought," Mr Fraguío says it remains to be seen how much lower the yields on corn already sown will be, but he is upbeat on prospects for late crops. Across the south of Brazil, farmers have already written off swaths of their corn crop, but are still hoping for rain to salvage some of their soyabean, which has just started to form pods. "[Our soya forecasts] could still improve a little bit, but in the case of corn there's no chance," says André Pessôa, head of Agroconsult. If rain comes soon, farmers in Argentina could still sow "second soya" on the stumps of the wheat crops, as usual - something many have stopped doing because of the drought. But local meteorologists are forecasting continued dry weather this week. Furthermore, the longer that farmers wait to decide whether or not to sow late crops, the greater the risk of those crops being damaged by early frosts in March or April. In San Antonio de Areco, about 90 minutes" drive from Buenos Aires, Gastón Pastori surveys the stunted, sun-scorched corn crops that reach up to his waist, but which should be as tall as him by now. "This week is crucial," he says. Additional reporting by Javier Blas in London.