Argentina Crop Conditions
- Buenos Aires Grain Exchange reported corn conditions improved to 30% good to excellent versus 27% last week and nearing last year’s 33%.
- Harvest was up to 12% complete from 8% last week, but below the 18% average.
- The exchange left its production forecast unchanged at 45 million tonnes, compared to the last USDA forecast at 47.5 million.
- Soybean crop ratings improved slightly to 9% good/excellent from 8% last week, but still well below 27% last year.
- 58% of the soy crop is mature compared to 70% average, and harvest is 3.6% complete vs 16% average.
- BAGE lowered its Argentine soybean crop projection by 1 million tonnes to 43 million tonnes.
- More rain is expected this weekend which likely will further slow harvest progress before weather turns drier next week.
- FBN’s Take On What It Means For The Farmer: Recent rainfall has not helped yield potential and only delayed harvest progress, which is nearly two weeks behind normal. Early yields remain disappointing and highly variable, and could end up below trend yield, which led to the decrease in the bean crop forecast. USDA will update its projections in today’s reports and is expected to reduce its outlook.
Argentine Producers Hold Beans
- Despite higher prices, producers are holding onto beans because of the country's falling currency.
- Through March, the official peso rate has declined nearly 30% in the last year.
- Soy prices are at seven-year highs at about $330 per tonne compared to $220 per tonne last year.
- Producers have sold only 31% of expected soybean harvest for 2020/21, versus 37% sold last year.
- Argentina needs export revenue as it battles recession, spiking COVID-19 cases, and uncertainty ahead of October elections.
- Argentina currently levies a 33% export tax on soybeans, 31% on soymeal and soyoil, 12% on corn and 12% on wheat.
- There is concern the government could legislate more intervention during the 2020/21 season.
- FBN’s Take On What It Means For The Farmer: Uncertainty is keeping farmers from selling and many are filling silo bags and planning to sell only as much as needed to meet expenses. This, along with reduced production due to dry weather, will continue to support higher export prices.
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