November 16, 2009

Argentina's soy crop is developing well across much of the farm belt but is struggling with drought in the Southwest edges of the Pampas, the Agriculture Ministry said in its weekly crop report Friday (November 13).

 

According to the Buenos Aires Cereals Exchange, farmers, as of Wednesday, had planted 33.8 percent of the forecast 19 million hectares seen going to soy.

 

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 favorable 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, up from the previous record of 47.5 million tonnes grown in 2006-07.

 

Wheat conditions are mixed, with crops in the central areas of the farm belt doing well, and the fields in the southwest struggling due to drought, according to the Ministry.

 

In the Bahia Blanca district in the south of Buenos Aires, the wheat crops are suffering badly, with many fields being turned over to cattle pasture.

 

According to the exchange, production will total 7.75 million tonnes, down sharply from the average of 14.8 million tonnes over the previous five years.

 

Yields are expected to fall sharply in the south, but higher yields in other areas are expected to compensate for the losses, according to the exchange.

 

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.

 

As of Wednesday, farmers had harvested 8.6 percent of the planted area, according to the exchange.

 

The young corn crop is developing well in the central farm belts, but is in bad shape in the southwest. Farmers are holding off planting in those areas due to dryness.

 

To date, 69 percent of the forecast 1.875 million hectares seen going to commercial corn this season have been planted, 5.3 percentage points behind the harvest pace at this time last season, according to the exchange.

 

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 eight million tonnes, leaving an equal amount available for export, according to the Rosario exchange.

 

Sunflower-seed planting is progressing well across most of the pampas but, as with the other crops, is struggling in the southwestern areas, the Ministry said.

 

In the Tandil district of Buenos Aires province, planting is moving quickly and the seeds already planted are showing "optimal development," the Ministry said.

 

However, in the Tres Arroyos district further to the south, farmers are making little planting progress, with very poor development of those seed already in the ground due to dry, cold weather.

 

On Wednesday, the exchange trimmed its forecast for sunflower-seed planting to 1.66 million hectares, down from 1.75 million hectares forecast last week. Drought in the southern and western fields has prevented planting and pushed farmers to switch to other crops, the exchange said.

 

Planted area is expected to be down 25.6% on the season.

 

To date, 55.5 percent of the forecast area has been planted, according to the exchange.