September 10, 2008

Argentina expands soy areas further at wheat and sunflower expense

Argentine farmers are likely to plant more soy to earn more and turn away from wheat and sunflower sowings due to low profits, Hamburg-based oilseeds analysts Oil World said.

Ongoing political tensions, unfavorable weather conditions, latest price developments and steep increases in production costs are reasons taken into account by farmers for this change.

"At the moment, a comparison of prices and expected income suggests that many farmers will opt for expanding cultivation of first crop-soy, even in traditional sunflower areas," Oil World claimed.             

Argentina's 2008/09 soy sowings could rise to at least 17.85 million hectares or higher from 16.94 million hectares in 2007/08, an increment of 5.37 percent.

Soy harvest in 2008/09 may increase to 51 million tonnes from 47.5 million in 2007/08, as estimated by Oil World, a 7.37 percent difference.