September 30, 2008

 

Argentina's drought lifts with moderate showers across Pampas

Argentina's farmers breathed a sigh of relief over the weekend as moderate rainfall fell across much of the drought-stricken Pampas.

 

After months without rainfall, the drought was broken across the center and northeast of the country, the Rosario Gain Exchange said Monday.

 

While the rain was a boon, it still wasn't enough to fully reverse the dry conditions. However, it may mark the return to normal moisture levels across the region, the Exchange said.

 

Analysts have predicted that increased rainfall is expected through October.

 

Moderate rainfall is expected to come again on Wednesday, according to the Exchange.

 

The northeast of Buenos Aires and centre of Santa Fe provinces received the heaviest showers, with almost 60 millimeters falling, while the southern areas of Santa Fe and Cordoba provinces got just 8 to 10 millimeters, the Exchange said.

 

Argentina's wheat crop has been struggling due to the severe drought. Decreased area and yields due to the dryness will cause production to fall at least 25 percent from the 16 million tonnes grown last season, according to the Buenos Aires Exchange.

 

The drought has also stalled corn and sunflower seed planting.

 

Last week the Buenos Aires Exchange reduced its forecast for sunseed area by 9 percent to 2.54 million hectares.

 

The severe drought, rising costs and falling sunseed prices led numerous farmers to turn away from the oilseed, the Exchange said.

 

Corn area will total just 2.7 million hectares, down 15.6 percent from last year, according to the Exchange.

 

As of Friday, farmers had planted just 6.8 percent of the area seen going to corn, down 2.6 percentage points from this time last year.

 

Soy planting hasn't started yet, but the area going to the seeds is expected to rise sharply this season as the beans take up the slack from decreased wheat, corn and sunseed area.