November 5, 2009

Argentine soy planting is well behind last year's pace due to a host of weather-related complications, the Buenos Aires Cereals Exchange said in its weekly crop report Wednesday (November 4).

 

Farmers have planted 12.1 percent of the forecast 19 million hectares to date, but the planting pace is 18 percentage points behind last season, the exchange said.

 

The delay is due to cool temperatures followed by storms and heavy rain in the northern and central areas, in addition to insufficient soil moisture levels in some of the western and northern areas, the exchange said. However, "widespread planting is expected to start up again across most of the farm belt in the next few days."

 

While soy area may increase because of a drop in sunflower seed planting due to dryness in Cordoba, La Pampa, Santiago del Estero and Chaco provinces, the continued drought in those areas is also preventing farmers from planting soy, the exchange said.

 

Soy area is expected to break the previous record by 7 percent, due mainly to decreased corn, sunflower seed and wheat planting this season.

 

Argentina's 2009-10 soy crop is also likely to get a boost this year from favourable weather conditions generally associated with a mild El Nino.

 

Agricultural analysts polled by Dow Jones Newswires forecast 2009-10 soy production of between 48 million and 55 million tonnes, which would smash by as much as 15 percent the previous record of 47.5 million tonnes grown in 2006-07.

 

Wheat conditions are mixed with the crops in the central areas of the farm belt doing well, and many around the fringes struggling due to dryness, the exchange said.

 

To date, farmers have harvested 7.4 percent of the planted area, in line with last year's harvest pace.

 

Last week the exchange upped its forecast for 2009-10 wheat production by 225,000 tonnes to 7.75 million tonnes.

 

That's still down sharply from the average of 14.8 million tonnes over the previous five years.

 

With domestic demand pegged at 6.5 million tonnes by the government, just 1.25 million tonnes of wheat are likely to be left over for export from the 2009-10 crop.

 

To date, 66.7 percent of the forecast 1.875 million hectares seen going to commercial corn this season have been planted, 5.9 percentage points behind the harvest pace at this time last season, according to the exchange.

 

Farmers have planted more late corn due to delayed showers and are still putting off planting in the areas that haven't been soaked yet by spring showers.

 

The Rosario Grain Exchange forecasts total corn production at about 16 million tonnes.

 

The government has pegged domestic consumption of corn from the 2009-10 crop at 8 million tonnes, leaving an equal amount available for export, according to the Rosario exchange.

 

Almost half of the forecast 1.75 million hectares seen going to sunseeds this year had been planted as of Wednesday, according to the Exchange.

 

The crop is developing well in the central areas of the farm belt, but suffering badly in the northern areas due to drought. In those areas, the crop "is entering a critical period ... with the lack of moisture causing the loss of plants or whole fields," the exchange said.

 

Planted area will be down 21.5 percent on the year, according to the exchange.