Argentina's soy boom a blow to corn farmers

Record soy crops in Argentina have caused dismay among corn farmers who see the government's focus on the lucrative soy exports as a potential blow to their crops.

Last year, Argentina earned about US$24 billion from soy exports, which are now seen by many growers as a good money spinner when compared with corn.

The Rosario Chamber of Commerce said the soy crop yield was likely to reach the record level despite a chronic drought and disincentives such as unpopular government export taxes.

Agriculture industry sources said the high yield owed much to farmers switching away from corn and other food crops to put more land under soy cultivation. In some provinces, soy crops this year encroached on more land previously dedicated to corn.

Agriculture experts said the El Nino effect has made likely an abundant rainfall and heating of the South Atlantic, which could generate welcome humidity in the area.

The good news of a high soy yield contrasts with all-round pessimism in Argentina's food agriculture sector, which has suffered under the worst drought in 100 years.

Grain production is estimated to have dropped 39% and livestock losses have multiplied, with some estimates putting total livestock at more than 1.5 million animals. The drought has also caused a seven million to eight million tonne drop in wheat production.

President Cristina Fernandez de Kirchner has faced criticism from farmers over a lacklustre government response to the crisis. The government has countered the charge but admitted that it is under resourced because of poor performance in other sectors of the economy.