Argentina soy fall on prospects for bumper crop; corn up

 

 

Argentine soy prices slumped this week as prospects for a bumper crop in South America weighed on the international soy market.

 

"The positive production outlook augers a record crop, and more rainfall is forecast for next week," the Rosario Grain Exchange said.

 

Spot soy traded at ARS950 (US$248.66) a tonne in Rosario Thursday (Jan 28), down from ARS980 (US$256.5) a tonne a week earlier.

 

May 2010 soy futures traded at US$215 a tonne, down from US$218 and US$220 a week ago.

 

Argentina's 2009-10 soy output is forecast to set a new record at 51 million tonnes, the Buenos Aires Cereal's Exchange said in its weekly crop report Thursday.

 

That's up sharply from the 32 million tonnes grown last season and is well over the previous record of 48.8 million tonnes grown in 2006-2007.

 

Local corn prices got a boost from buying by exporters. Government approval of corn export permits this week and expectations that the export quota will be increased due to a large crop also fuelled the buying, the exchange said.

 

March-April corn futures traded at US$113 a tonne, up from US$110 a week ago.

 

Corn area this season was higher than initially expected and the crop is developing well across much of the farm belt.

 

This week the exchange raised its forecast for commercial corn output by 400,000 tonnes to 18.4 million tonnes.

 

Total corn production could reach 18 million to 20 million tonnes, President Cristina Fernandez said last week. That's up significantly from the 12.6 million tonnes grown last season when the crop was battered by drought.

 

Wheat wasn't traded again Thursday as farmers hold out for higher prices agreed with the government.

 

"Farmers are looking for buyers to come through with their commitment to buy the cereal over the short term, but trade continues to be stalled," said the exchange.