Argentina: 2023/24 harvest to revamp grain exports

The 2023/24 harvest is expected to revamp soybean and corn crops in Argentina. This assessment was released on Wednesday (9/20/) by the Safras & Mercado consultancy during an online event. After three consecutive years under the negative effects of the La Niña phenomenon, the expectation is for more favorable conditions with El Niño, stated analyst Joaquin Azpiroz.

“There are encouraging signs, with El Niño causing more rain than in recent years. We have a positive outlook on rainfall,” he said.

Argentinian farmers are expected to plant 16.8 million hectares of soybeans, 3% more than in the 2022/23 cycle. Production is projected to reach 48.5 million tonnes, a 130% increase.

In the 2022/23 season, production reached 21.1 million tonnes, with a significant production drop. As one of the world’s largest exporters of soymeal, Argentina had up to 57% idle capacity in its industry, according to Safras & Mercado.

With a greater harvest expected, grain processing is likely to improve, and some space in the worldwide soybean meal market will be recovered. “Argentina reduced its exports of soybean meal, making room for Brazil,” Azpiroz underlined.

The corn crop area is expected to total 7.9 million hectares, up 3%, projected Safras & Mercado. Production is expected to increase by 62%, reaching 55.69 million tonnes. Azpiroz explained that Argentinians are likely to prioritize the use of early yields to avoid competition with Brazil’s second crop, which could pressure prices.

Argentinian corn production also suffered a drop in the 2022/23 cycle. According to the consultancy, the harvest reached 34.3 million tonnes, 31% less than the previous season and 20 million tonnes below initial forecasts.

In addition to production losses, Argentina’s agribusiness has been dealing with government interventions in the economy. Among the main measures are the return of export taxes and the establishment of differential exchange rates for the sector.

The analyst emphasized that previous losses have left Argentine producers in a “delicate” financial situation, and both soybean and corn marketing levels are low.

In October, Argentina will have presidential elections that could define changes in economic policy. According to Azpiroz, the government is unlikely to give up export taxes. However, there is uncertainty regarding other measures, such as differential exchange rates for the sector.

“Export taxes increase the selling price of exports. And the agro-dollar causes distortions in the market,” he emphasized.

Source: Globo Rural

To read the original news text, please refer to: https://globorural.globo.com/agricultura/noticia/2023/09/argentina-deve-recuperar-produo-de-soja-e-milho-na-safra-202324.ghtml

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