BUENOS AIRES: The drought afflicting Argentina since November has shriveled soy yields to the point that analysts and farmers have slashed harvest estimates by about 10 million tonnes, with final crop forecasts consolidating under the 50 million tonne mark.
The dryness has walloped the heart of the normally fertile Pampas grains belt in Argentina, world’s top exporter of soymeal livestock feed and No. 3 supplier of raw soybeans and corn.
“At the start of the season we expected a soy harvest of 57 million tonnes. Now we are looking at 47 million tonnes,” said Pablo Adreani, head of Argentine farm consultancy Agripac.
Adreani has also cut his original 2017-18 corn crop estimate to 37 million tonnes from 42 million tonnes.
On top of the “irreparable damage” the drought has caused to yields, he said dry conditions stopped farmers from sowing 800,000 hectares of soy and 500,000 hectares of corn that they had planned on planting at the start of the 2017-18 season.
The drought has put upward pressure on global food prices. Chicago Board of Trade soy futures shot higher last week after the Rosario grains exchange said it planned to cut its current 52 million tonne 2017-18 soy harvest forecast to 50 million tonnes or lower.
Much needed rain on the Pampas has not arrived in substantial quantities this month, with only sporadic showers expected over the days ahead. Francisco Abello, a partner at the TraulenCO SA farm management company, said talk among grains brokers is now of a soy harvest of under 50 million tonnes.
“I agree with that assessment,” Abello said.
“These last rains were not enough to change the effect of the drought in most of Buenos Aires and Entre Rios provinces,” he added. “They only gave us a few more days of crop survival.”
The Buenos Aires grains exchange this month cut its soy crop estimate to 50 million tonnes from 51 million tonnes previously, while the US Department of Agriculture slashed its outlook to 54 million tonnes from a previous 56 million tonnes.
A Buenos Aires-based executive with a major grains exporting company, who asked not to be named due to lack of permission to speak to the press, said the industry is taking a more pessimistic view, with local traders now expecting about 47 million tonnes of soy to be harvested in the 2017-18 crop year.
Source: Brecorder.com
