November 19, 2003

 

 

Argentina 2003-04 Soybean Area Up 9% At 13.75 Million Hectares

 

Farmers in Argentina will plant a record 13.75 million hectares of soybeans during the 2003-04 campaign, the Agriculture Secretariat said late Tuesday in its monthly crops report.

 

Soybean prices have soared in recent months, giving farmers extra incentive to plant the crop. Farmers are also expected to plant more soybeans because they are cheaper to plant than corn and more resistant to climatic problems, which have plagued the 2003-04 corn and wheat crops.

 

"The severe problems related to the lack of humidity in Cordoba, Santa Fe, San Luis and some other provinces in the north of the country have caused area, which was originally set to be planted with corn and sunseed, to be filled with soybeans," the Secretariat said. "This will be the biggest soybean area in the history of the country."

 

If the Secretariat's prediction holds, the soybean area will be 9.1% larger than it was a year ago, when farmers planted 12.6 million hectares.

 

Argentina produced 35 million tons of soybeans in 2002-03, according to the Secretariat.

 

The U.S. Department of Agriculture expects Argentina to produce 38 million tons of soybeans in 2003-04. The Secretariat has not provided an official estimate, but officials say that output probably will reach 37 million tons.

 

Farmers already have started harvesting the soybean crop in northern Argentina, though the Secretariat has not yet provided any estimates about the pace of collection.

 

CORN

 

Meanwhile, the Secretariat cut its estimate for planted corn area in 2003- 04. Corn area will likely decline 5.6% from a year ago to reach 2.91 million hectares.

 

"It is estimated that 2.31 million hectares will be dedicated to commercial corn while 600,000 hectares will be collected as feed," the Secretariat said.

 

Last year farmers planted 3.092 million hectares and produced 15 million tons, according to the Secretariat.

 

Of the 3.092 million hectares planted in 2002-03, only 2.3 million hectares were used to produce corn for sale in the commercial circuit, according to the Secretariat.

 

The Secretariat did not provide an officials estimate for 2003-04 production. However, the USDA has forecast 2003-04 production at 14 million tons, down two million tons from a month ago.

 

Argentina's drought has parched corn fields, making it impossible to plant much of the crop under decent soil conditions. As a result, many farmers have opted to fill the open area with soybeans, which can often be planted successfully under less-than-ideal soil conditions.

 

Argentina was the world's No. 2 corn exporter in 2002.

 

The country lost this position to China earlier this year, but local analysts and the USDA believe lower Chinese exports in 2004 will push Argentina back into the No. 2 position next year.

 

Planting of the 2003-04 crop was 53% done by Friday, according to the Secretariat.

 

SUNSEED

 

The Secretariat expects area for the 2003-04 sunseed crop to decline about 9.6% from a year ago.

 

Sunseed area is now seen at 2.15 million hectares, down from 2.32 million the previous year.

 

Excessively dry and hot weather has reduced expectations for the crop, which is normally planted between September and December.

 

A lack of rain has also seriously slowed planting.

 

As of Friday, farmers had planted 56% of the crop. By this time last year, farmers had planted 69% of the crop.

 

Argentina produced 3.7 million metric tons of sunseed during the 2002-03 campaign, according to Secretariat data. The Secretariat has not forecast 2003-04 sunseed production.

 

The U.S. Department of Agriculture has said Argentina likely will produce 3.7 millions of sunseed in 2003-04.

 

WHEAT

 

Finally, the Secretariat lowered its forecast for Argentina's collectable wheat area in 2003-04. It also provided an estimate for production that would put output down from 2002-03, when Argentina produced 12.3 million metric tons.

 

The Secretariat said farmers planted 6.0 million hectares of 2003-04 wheat. But because of the drought only 5.7 million of this will be harvested.

 

A dearth of precipitation has damaged the crop in many areas and prevented yields from rising from a year ago.

 

"The prolonged drought in a large part of the wheat region has caused a severe reduction in collectable area," the Secretariat said. It estimated lost area at around 300,000 hectares.

 

"The impact of the lack of water not only depressed yields in southeastern and southwestern Buenos Aires, Cordoba and La Pampa, but it also caused productivity per hectare to vary greatly in areas less affected by the lack of humidity," the Secretariat said.

 

The Secretariat forecasts 2003-04 wheat production to total between 11.3 million and 11.8 million metric tons.

 

USDA has estimated 2003-04 output at 13 million tons.