MarketsFarm — While Argentina is headed to one of its worst soybean harvests in decades, the U.S. Department of Agriculture (USDA) attaché in Buenos Aires projects a huge turnaround in 2023-24.
Argentina is the world’s third-largest grower of soybeans — a fair amount less than Brazil and the U.S., but a lot more than other countries. As well, Argentina is the largest exporter of soymeal.
A severe drought this marketing year devastated Argentina’s soybean crop, with a wide array of production outlooks tumbling well under 30 million tonnes. The attaché’s report noted 2022-23 was the third consecutive dry year for the country, due an extended La Nina. Plus there was little soil moisture content when planting took place. On top of that, extreme heat during January and February together with an unusual frost further exacerbated an already bad situation.
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For example, the Rosario Grain Exchange recently dropped its latest estimate of Argentina’s soybean crop to 23 million tonnes, a far cry from its initial forecast of 47 million. Even the staid USDA cut its official call this month to 27 million tonnes, being one of the last private or government organizations to drop below 30 million.
The Buenos Aires desk calculated this year’s crop to come in at 23.9 million tonnes, 44.3 per cent less than what was harvested in 2021-22. That said, the attaché projected a bright outlook for 2023-24, calling for a massive production turnaround to 50.5 million tonnes, based on a return of normal weather patterns, spurred on by an El Nino.
Until then, Argentina farmers were said to be a very tough situation, with the attaché noting many of them are presently cash-poor and the country’s inflation rate is more than 100 per cent. The federal government has provided limited support to help get farmers through to next year. Other reports said there could be a sharp increase in unharvested acres.
To make up for shortfalls in soy products, Argentina remained on pace to import a record 11 million tonnes of soybeans from neighbouring countries as well as the U.S. That’s expected to tumble to 3.5 million tonnes in 2023-24.
Soymeal output was projected to fall from 26.86 million tonnes in 2021-22 down to 22.25 million this year. But the attaché forecast a sharp increase to 31 million tonnes for 2023-24.
Argentina’s soymeal exports fell from 25 million tonnes in 2021-22 to only 18.75 million this year. But in keeping with the attaché’s optimism, those exports are to jump to 27 million tonnes in 2023-24.
Soyoil production was 6.92 million tonnes in 2021-22, according to the attaché. That’s to retreated to 5.7 million this year, but it’s to balloon to 8.1 million next year. Exports were 4.74 million tonnes in 2021-22, with those projected to drop to 3.65 million and then climb to 5.5 million in 2023-24.
