Argentina's wheat planting may hit record low

Drought and export restrictions may lead to Argentina planting the smallest wheat crop on record, the Buenos Aires Cereals Exchange said.

Planting will fall as low as 3.7 million hectares this year, the smallest since the exchange started recording the data in 1910, the exchange said.

If the dry weather continues and the government still do not offer any concessions to farmers, then acreage could fall as low as three million tonnes, said Pablo Adreani, a Buenos Aires-based analyst at Agripac Consultores.

Farmers harvested 8.3 million tonnes of wheat earlier this year, less than half the prior year, due to a drought that is deemed as the worst in half a century, the Agriculture Secretariat said.

This year's planted area will be 18.6-percent less than a year ago, the exchange said.

The government taxes wheat at 28 percent and restricts exports to provide sufficient supplies for the domestic milling sector, the Rosario Board of Trade said, adding that farmers are finding it impossible to receive export permits because of a lack of available domestic produce.

The cereals exchange forecast three more months of dry weather in its weekly weather report. Soil erosion is occurring in southern Buenos Aires and La Pampas provinces, causing an ''ecological disaster'', the exchange said.