December 4, 2008

Argentina October wheat exports soar; corn down


Argentina exported 728,443 tonnes of wheat in October, up sharply from 78,200 tonnes shipped during October 2007, according to animal- and food-inspection agency Senasa.


Wheat shipments during the first 10 months of the year totalled 7,719,748 tonnes, down from 7,721,088 tonnes a year earlier.


Last week, national agricultural trade office ONCCA authorized an additional 675,011 metric tonnes of wheat for export, leaving 1.1 million tonnes from the old crop available for export.


However, new crop exports are expected to be limited this season.


Argentina will likely have just 4 million tonnes of wheat available for export from the 2008-09 crop, down sharply from past levels, ONCCA President Ricardo Echegaray said on Monday (December 1).


ONCCA must approve all grain and beef exports and only clears shipments once stocks sufficient to meet domestic demand, as set by the government, have been confirmed.


Rising domestic demand for wheat and sharply lower production this season due to decreased planted area and poor yields are blamed for the drop in forecast exports from the new crop.


Argentina's farmers will grow just 10.1 million tonnes of wheat this season, down from 16 million tonnes a year earlier, according to the Agriculture Secretariat.


Domestic demand is likely to rise to 7 million tonnes in 2009, from the 6.1 million tonnes set aside for local use this year, Echegaray said.


However, part of that amount set aside will be milled locally and exported as flour under the government's policy of stimulating greater domestic processing, Echegaray said.


Argentina exported 930,231 tonnes of corn in October, down from 1,253,024 tonnes shipped in October 2007, according to the latest data from Senasa.


Corn exports during the first 10 months of the year reached 14,618,736 tonnes, up from 14,048,740 during the same period a year ago.


There is virtually no old crop corn available for new export sales, according to ONCCA.


Argentina's corn exports are also likely to be significantly lower next season.


Production is estimated by the US Department of Agriculture at 18 million tonnes, down from 20.5 million tonnes grown in 2007-08. Higher production costs for corn relative to soy and dry weather early in the planting season are blamed for the shift. Local forecasts are predicting an even sharper drop in production.


About 14.7 million tonnes were exported from the 2007-08 crop. Domestic demand is currently pegged at 6.1 million tonnes, but the amount withheld for domestic consumption may be increased somewhat due to increasing use of corn in feedlots, Echegaray said.


If the USDA's forecast for Argentina corn production holds and the domestic use quota is unchanged next year that would leave just 11.9 million tonnes available for export.

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