November 6, 2024

Argentina's 2024-25 soybean production forecast rises amid economic and weather challenges

Argentina's soybean production for the 2024-25 season is projected to increase, despite facing complex challenges shaped by weather conditions, economic factors, and production practices, according to the Foreign Agricultural Service (FAS) of the US Department of Agriculture.

The FAS report estimates that soybean production will reach 52 million tonnes, up from 49.5 million tonnes in the previous season. Concerns over corn production challenges have prompted producers to shift toward soybeans, with contributing factors including the threat of corn stunt disease, low corn prices, and anticipated dry conditions.

Higher-than-expected temperatures are a potential risk, as they could reduce soil moisture levels and impact yields. Additionally, soil moisture deficits have already caused delays in early planting for some regions, further complicating the season's outlook.

Economic considerations are also influencing farmers' decisions, as the production costs for soybeans remain notably lower than for other crops. This financial pressure is pushing more producers towards soybean cultivation, the FAS explained.

Farmers are adapting to a recent shortage of high-grade seed stock by reducing planting densities, allowing each seed more room to germinate. However, this adjustment is expected to impact total yields, as fewer seeds per acre may limit overall production.

"Overall, the combination of environmental, economic, and technical challenges paints a complex picture for Argentina's soybean sector in 2024-25," the FAS stated. "While increased acreage and technological advancements may support production, the adverse weather and compromised seed quality may prevent yields from reaching their full potential, and the financial strain on producers remains significant."

The report also indicates that soybean crush is projected to see a minor increase, from 41.5 million tonnes to 42 million tonnes. Argentina's soybean crush industry has experienced a boost this year, driven by increased domestic production and a steady flow of imports, primarily from Paraguay.

-      World-Grain