March 20, 2007

Argentina to raise annual grain production to 120 million tonnes by 2010
 

Argentina could raise its annual grain production from the current 90 million tonnes to 120 million tonnes by 2010, said Gustavo Grobocopatel, director general of the Los Grobo group Mar 16.

In a statement during the Reuters Latin American Investment Summit in Buenos Aires, Grobocopatel commented that a 50 percent and 10 percent increase in domestic corn and soy production respectively could push up grain output to that level.

He added that the increase could come in three years if prices stayed at current levels, or five to six years should prices drop or taxes and fertiliser costs rise.

Output for the 2006/07 soybean harvest is estimated between 42.5 million and 44.5 million tonnes, according to the Argentine government. Total grains and oilseeds production is estimated at a record high of 94 million tonnes.  

Grobocopatel expects soy prices to rise worldwide due to reduced soy sowing in the US, spurred by high corn prices from increasing ethanol demand.

Argentine corn production next year is also seen to rise 50 percent to 30 million tonnes, up from the government's 2006/07 estimate of between 21 million and 22 million tonnes, said Grobocopatel.

As for Argentine soy production, there was still potential for expansion in some parts of key farming provinces Buenos Aires and Entre Rios, Grobocopatel added.