Switch from soy to drive Argentine wheat revival

 

 

Argentina's wheat exports are to rebound by 75% next season thanks to a revival in plantings as concerns over disease curtail farmers' obsession with soy.

 

Corn sowings will increase too, although a return to historic yields would see production fall.

 

Wheat production in Argentina will jump by one quarter to 12.0 million tonnes in 2010-11 as growers opt to return more wheat into their crop rotation, a report from the USDA Buenos Aires bureau said.

 

The increase will feed through into a jump to 7.0 million tonnes in exports after two years when they have been depressed both by drought and a preference for corn and soy, which have appeared more profitable.

 

However, farmers have begun to get cold feet over soy sowings, which rose by well over one million hectares in 2009-10, despite being generally more profitable, according to the report.

 

"Many producers are concerned about the long-term negative impact of not rotating soy with other crops," the briefing said, noting that some local plant pathologists report that more pests are attacking soy crops as a consequence of mono-cropping.

 

Wet weather this year has encouraged the spread of fungal diseases, and brought frogeye leaf spot to many areas previously free of the yield-endangering ailment.

 

The damp conditions have also prohibited fieldwork, forcing many farmers to fork out on aerial crop spraying to keep diseases in check.

 

A revival to 7.0 million tonnes in wheat shipments would return Argentina to its historic place in the mid-rank of global exporters, if remaining well short of historic highs.

 

Three years ago, Argentina shipped 12.2 million tonnes, putting it ahead of Australia and Russia.

 

Argentina has a ready export market in neighbouring Brazil, the world's second-ranked wheat importer, which has relied increasingly on North American supplies and, of late, reportedly from Europe and Russia too.

 

However, farmers have been encouraged to turn to other crops both by the weak international wheat price, which has been depressed by heavy global stocks, and particularly strong curbs on exports imposed in an effort to protect domestic supplies.

 

The report pegged Argentina's corn output at 20.0 million tonnes in 2009-10, one million tonnes shy of the official USDA forecast.

 

Output is expected to fall to 19.5 million tonnes in 2010-11, due to yields returning to the long-term trend, despite a small increase in sowings encouraged by the wish for greater crop rotation.