In Commodity News 29/02/2016
Argentina’s wheat and corn crops received further upgrades – but excess rains raised questions over the soybean harvest reaching its potential.
Argentina’s agriculture ministry, citing updated analysis of survey data, raised by 300,000 tonnes to 11.3m tonnes its estimate for the newly-finished wheat harvest.
The upgrade came minutes are the International Grains Council raised its forecast for the crop, by 100,000 tonnes to 11.0m tonne – if highlighting that this remained well below last season’s level, of 13.9m tonnes, and cautioning over crop quality too.
“Although yields of 2.9 tonnes per hectare were similar to recent years, average quality was worse than normal, including lower than usual protein,” the IGC said.
‘Good commercial conditions’
Both commentators raised ideas for the Argentine corn harvest too, with the ministry lifting its estimate for sowings by 190,000 hectares to 5.69m hectares, citing a spree of late seedings encouraged by “good commercial conditions”.
Growers’ profitability prospects have been enhanced by the removal by the country’s new government of export quotas and taxes on corn and wheat.
Argentina ‘s farm ministry, which has yet to make a forecast for the forthcoming corn harvest, sad that there were some areas where crops had suffered from excessive rain or drought, but that there were “no major crop disease or insect problems”.
The IGC, meanwhile, also flagged additional plantings, as it hiked its forecast for the Argentine corn harvest by 2.0m tonnes to 28.0m tonnes.
“Firm local prices and recently announced changes to official export policies spurred some additional plantings in northern Argentina,” the council said.
“While hot and dry weather briefly stressed crops in central and northern areas, subsequent rains were largely beneficial, maintaining mostly favourable yield prospects.”
Erratic rainfall
However, on soybeans, the farm ministry trimmed its estimate for sowings by 20,000 hectares to 20.68m hectares, although this would still be a record high.
And, thanks to rainfall levels which have been excessively high or low in some areas, a decline in yields was seen as, generally, on the cards.
That tallied with an IGC estimate of Argentine soybean sowings up 5% year on year, and of area of “around” 20m hectares on a harvested basis.
“However, because average yields could fall from last year’s exceptional level of 3.2 tonnes per hectare, output is forecast to decline to 60.0m tonnes,” from 61.4m tonnes last year, the council said.
Source: Agrimoney
