March 22, 2010

Argentina steps up corn, soymeal sales amid bumper harvest

Forecasts of a record soy production and a healthy corn crop this year have led to Argentina turning an aggressive seller of both grains in recent weeks, trading executives said Friday (March 19).

"Buyers and sellers are wary of possible logistical bottlenecks (such as) workers' strikes or unforeseen government restrictions, and therefore want to ship out as much volume as possible at the earliest," a commodities broker in Buenos Aires said.

Argentina has sold several cargoes of corn, soymeal, soy and soyoil this month to buyers in Southeast Asia, trading executives said.

Argentina's soy output is likely to reach a record 53 million tonnes this year, up from 32 million tonnes in 2008-09, according to an estimate by the USDA. Production last year was badly affected by a drought. Argentina leads the world in soymeal and soyoil exports and is the third-largest soy exporter.

The country's corn output is expected to bounce back to 21 million tonnes from 12.6 million tonnes last year. Argentina is the world's third largest corn exporter.

"Deals are being transacted almost daily and large volumes (of soymeal and corn) are due for shipment from Argentina (to Asia) soon," a Singapore-based executive of a global trading company said.

At least 175,000 tonnes of corn is scheduled for shipment to Southeast Asian destinations in the period from late March to early April, the broker in Buenos Aires said.

In the next two weeks, soymeal totaling 168,000 tonnes will be exported to Indonesia, Malaysia, South Korea and Singapore, he added.

He said China is booking cargoes of soy, sunflower oil and soyoil. Sales to China include a parcel of 45,000 tonnes soy and another of 23,500 tonnes soyoil for late-March shipment.

Soy crushing in India has been slow and this has prompted buyers in South Korea and other countries to Argentina for supplies. South Korea has bought 45,000 tonnes of soymeal for end-April delivery, said a Seoul-based trader.