May 10, 2004
Little Change In Argentina's Grain, Oilseed Prices
Argentina's major grain and oilseed prices ended Thursday with values little changed from a week ago.
Soybeans in Rosario, Argentina's principal cash soybean market, were sold for 675 pesos ($1=ARS2.89) per metric ton on Thursday, down slightly from ARS680 a week ago.
"Prices aren't much different, but soybeans are a bit down because of expectations for good planting conditions in the U.S.," one trader said.
The Rosario-based brokerage Roagro expressed similar sentiments.
"The rain forecast for the days ahead and the advance of seeding are combining to make the first stage of the U.S. harvest a success ... and prices are reflecting this situation," Roagro said Thursday in an email commentary on the local market.
Roagro said the current market context is "not very promising for (price) increases." Moreover, Roagro said there is an "elevated risk" that short-term speculators will enter the market and sell, which could lower prices or at least keep a lid on them.
On Monday, the Buenos Aires Cereals Exchange clipped its forecast for 2003-04 soybean production to 32.5 million metric tons, down from 33.2 million previously.
This estimate, which came as no surprise to local traders, is below the 33 million tons forecast by the Agriculture Secretariat but above the 30-31 million seen by a number of local analysts.
The U.S. Department of Agriculture has put Argentina's soybean output at 35 million tons, though this figure has been roundly criticized by locals.
Whatever the end result, production is set to decline from 34.8 million tons a year ago, according to government data.
Meanwhile, in a weekly update on the spread of Asian rust, Argentina's animal and vegetable health agency, Senasa, confirmed that a new case had been found in Santa Fe, home to more than a third of the country's soybeans.
Senasa also confirmed new cases in Chaco, Corrientes, Formosa and Tucuman.
This brings the total number of confirmed rust cases to at least 13, with eight provinces having confirmed outbreaks.
Senasa also said it has found other "highly suspicious" but unconfirmed cases in other provinces, including Catamarca, Entre Rios and Salta.
Senasa reiterated previous comments that the disease will not have a big impact on soybeans because most of the harvest is already in the latter stages of development.
Consequently, yield potential has already been realized and the crop will not suffer any widespread damage, according to Senasa.
As of Friday, farmers had collected 54% of the 2003-04 soybean crop, according to the Secretariat. But even more has been collected in northern provinces affected by the disease.
By Friday, some 85% of the crop had been harvested in Corrientes and Formosa, while 79% had been collected in Santa Fe.
Argentina is the No. 3 producer of soybeans behind Brazil and the U.S.
CORN
Cash corn sold for ARS275 Thursday in Rosario, unchanged from a week ago.
Around 5,000 tons of corn were traded on Thursday, traders estimated.
As of Friday, farmers had finished collecting 50% of the 2003-04 corn crop by Friday, the Secretariat reported.
The Secretariat estimates 2003-04 corn output at 12.4 million metric tons and the Buenos Arise Exchange sees production at 12.8 million tons.
Argentina produced 15 million metric tons of corn in 2002-03, according to the Secretariat.
The USDA has forecast 2003-04 corn production at 12.5 million tons.
WHEAT
Wheat for immediate delivery sold for ARS360/ton in Rosario, unchanged from a week ago. Only about 1,000 tons of wheat were sold Thursday in Rosario.
In the southern port of Bahia Blanca, cash wheat sold for ARS380 on Thursday, up from ARS370 a week ago.
The Secretariat has forecast 2003-04 wheat production at 14.5 million tons.
Last year, the harvest totaled 12.3 million tons.
The Buenos Aires Exchange has estimated total production at about 13.7 million tons in 2004, compared with 12.16 million tons in 2003, according to exchange data.
The USDA has forecast total output at 13.5 million tons in 2004.
