High yields improve Argentine soy outlook

Argentina's 2009-10 soy harvest should exceed a record 54 million tonnes due to bumper yields in most areas, according to the president of Los Grobo, one of the country's leading agricultural companies.

 

Los Grobo provides logistical and grains storage services to farmers in Argentina, Brazil, Paraguay and Uruguay, and it also produces soy, corn and wheat on some 250,000 hectares (nearly 618,000 acres) in the region.

 

"We're going to have a total Argentine harvest that's a bit over 90 million tonnes," Gustavo Grobocopatel said. "The yields have been very good, we're going to be above 54 million tonnes in soy."

 

He said Los Grobo aimed to increase the amount of land it farms in the region by 20% to 300,000 hectares in the 2010-11 crop season, helping lift revenue to US$800 million.

 

Grobocopatel, sometimes dubbed the Soy King by the Argentine media, said there is still space to plant more crops in Argentina, but that the need to diversify climate and political risk was behind the company's expansion strategy.

 

Farmers are at odds with the centre-left government of President Cristina Fernandez over policies including export curbs, frequent changes to export bureaucracy and taxes on shipments of grains and beef.

 

The government in Argentina, a leading global supplier of farm goods, taxes soy shipments with a levy of 35%. An attempt to raise the rate even higher unleashed months of angry protests by growers in 2008.

 

Grobocopatel urged Fernandez to slash wheat export levies as a way to encourage farmers to sow the cereal as the 2010-11 planting campaign gets underway.

 

"The export taxes have caused soy's domination. The government should try to increase the amount of wheat available for export by lowering the export taxes," he said. "Lowering the taxes would be better for agriculture, for sustainability, for farmers and for the government too."

 

Argentina has historically been a top five global wheat supplier but growers have dedicated less land to the crop in recent years and production sank to 7.48 million tonnes, the lowest level in three decades.