March 3, 2006

 

Argentina's soy prices lower; corn prices up

 

 

Argentina's soy prices were lower again Thursday (Mar 2) from a week ago as higher soybean futures in the US failed to lift local values from the previous week, traders said.

 

Cash soybeans sold for between ARS510 and ARS530 (US$172.9) per tonne at the Rosario Cereals Exchange, compared with ARS530 a week ago. It was not clear how much soy was sold Thursday in Rosario.

 

May soy futures sold for US$167-US$168/tonne, little changed from US$167 a week ago.

 

While soybean futures gained ground at the CBOT, this was not enough to lift local prices above last Thursday's levels. Indeed, traders say the tendency is going to be for soybean prices to decline in the weeks ahead as farmers begin harvesting a record 2005/06 crop, which will mix with a record 2004/05 crop to push prices lower.

 

"It wouldn't be out of the ordinary to talk about futures in the range of US$150-US$155 per tonne," said Federico Mircoli, a trader with Granos del Parana.

 

Farmers have planted practically the entire 2005/06 soybean crop, according to the Buenos Aires Cereals Exchange.

 

The US Department of Agriculture has forecast Argentina's 2005/06 soybean crop at a record 40.5 million tonnes. The Agriculture Secretariat sees output at between 38.5 million and 40 million tonnes.

 

"We're going to get a good crop this season," Mircoli said.

 

Mircoli said local prices would likely be even lower if the market relied solely on local news. Recent rain has been good for the crop, and this is the kind of thing that would push prices down if it were not for rising prices at the CBOT.

 

As of Feb 28, Argentina had sold 10.098 million tonnes of 2004/05 soybeans for export, local Agriculture Secretariat data show. Sales of 2005/06 soybeans totalled 1.799 million tonnes by the same date.

 

 

Corn

 

Cash corn sold for ARS248-ARS250 per tonne Thursday in Rosario, up from ARS240 a week ago.

 

Farmers had harvested 4.1 percent of the 2005/06 corn crop by Saturday, according to the Buenos Aires Exchange.

 

The USDA has forecast Argentina's new corn harvest at 15.5 million tonnes.

 

The Argentine Corn Association sees production at 14 million tonnes and the Secretariat sees it at 13.8 million tonnes.

 

Last season good weather and solid prices led farmers to harvest a record 19.5 million tonnes of corn, according to the USDA. The Agriculture Secretariat says output last season totalled a record 20 million tonnes.

 

The Buenos Aires Exchange says farmers have planted 15.2 percent less corn than a year ago. It sees planted area at 2.23 million hectares, down from 2.62 million hectares the previous season.

 

As of Feb 24, Argentina had sold 13.99 million tonnes of 2004/05 corn for export, up from 11.16 million tonnes a year earlier, Secretariat data show.