August 10, 2009

Argentina's young wheat-crop conditions vary widely, with dryness affecting the western regions and cool temperatures slowing development of the late wheat, the Agriculture Secretariat said in its weekly crop report Friday (August 7).

In the Bragado district of Buenos Aires province, "soil moisture levels have notably recovered in the last weeks due to the rainfall. Planting is finished and in general the crop condition is very good," the Secretariat said.

 

However, in the Laboulaye district of Cordoba province, "the crop is deteriorating daily, due to drought and low temperatures. Ten percent of the planted area has already been turned over to pasture due to its sparse development and the need for animal feed," the Secretariat said.

 

According to the Buenos Aires Cereals Exchange, just over 90 percent of the forecast 2.75 million hectares had been planted with wheat as of Wednesday. Area is expected to be down 40.2 percent on the year and represents the smallest area going to wheat in more than 100 years.

 

Neither the Secretariat nor the Buenos Aires exchange have forecast production yet, but the Rosario Grain Exchange says that 2009-10 wheat production is likely to total about 7.4 million tonnes.

 

That's down from 8.7 million tonnes in 2008-09 and down sharply from the average of 14.76 million tonnes over the previous five years.

 

With domestic demand estimated at six million metric tonnes, just 1.4 million tonnes of wheat is likely to be left over for export from the 2009-10 crop, the Rosario Exchange said.

 

Sunflower seed planting is just starting, but the dry conditions in the north are slowing progress.

 

The Buenos Aires exchange estimates farmers will plant 2.22 million hectares with sunflower seeds during the 2009-10 season, up 3 percent from last year.

 

The Buenos Aires exchange's forecast is significantly higher than the two million hectares expected by the Rosario Grain Exchange. The Rosario exchange forecasts production of 3.4 million tonnes, up from about three million tonnes last season.

 

The 2008-09 corn harvest is all but done, with the Buenos Aires exchange pegging commercial corn production at just 12.5 million tonnes. The crop was the smallest in more than a decade due to extensive drought damage.

 

Meanwhile, corn area during the 2009-10 season is likely to fall sharply, according to the Rosario exchange.

 

Area is unlikely to be over 2.3 million hectares, with 2009-10 production at about 16 million tonnes, according to the Rosario exchange.

 

Half of that amount will likely be set aside by the government for domestic demand, leaving just eight million tonnes available for export, according to the Rosario exchange.

 

Soy production is expected to rise sharply again next season.

 

Soy planting is likely to surge to between 19 million and 20 million hectares during the 2009-10 season, Buenos Aires exchange chief climatologist Eduardo Sierra said in a recent interview. That would shatter the record set during the 2008-09 season, when farmers seeded 16.6 million hectares with the oilseed.

 

The Rosario exchange forecasts 2009-10 soy planting of 18.5 million hectares, with production of 50 million tonnes.

 

In addition to weather factors, the fact that soy are the only major crop in which the government doesn't control exports is spurring farmers to plant more of the oilseed. Argentina limits the export of wheat and corn to ensure domestic supply and keep down local prices.