Argentine soy, corn planting seen boosted by rains

Tue Oct 9, 2012 3:04pm EDT

* Wet weather so far a net benefit despite some flooding
    * Argentina is world's No. 1 soyoil, soymeal exporter
    * Some wheat losses seen due to August-September floods

    By Hugh Bronstein
    BUENOS AIRES, Oct 9 (Reuters) - Corn and soy planting in the
eastern Argentine province of Entre Rios will be helped by light
rains this week while the country's key farm area to the south
starts getting the sunshine needed to recover from recent
flooding, a forecaster said on Tuesday.
    The wet start to Argentina's spring planting season has
raised hopes for big harvests after dry crop weather in the
United States, Russia and Australia sapped food stocks and
squeezed global grains prices higher.    
    The South American country is a top exporter of corn,
soybeans and derivatives such as soyoil, used to make biofuels,
and meal, used as cattle feed as far away as China, whose
fast-expanding middle class is acquiring a taste for beef steak.
    "We are going to see a lot of rainfall - coming to 50
millimeters in some areas - in Entre Rios, Corrientes and parts
of Chaco and Misiones provinces," said Jose Luis Aiello, head of
the Applied Climatology Consultancy in Buenos Aires province.
    Entre Rios is part of the Pampas grains belt. Just south of
the province is the country's key bread basket region of Buenos
Aires, where little rain is expected over the next five days.
    "This is good news because Buenos Aires has had an excess of
water," Aiello said, adding moderate rains should fall
throughout Argentina next week.
    Farmers are expected to sow a record 19.7 million hectares
(48.7 million acres) with soybeans in the 2012/13 crop year, up
4.5 percent from the 2011/12 season. 
    
    The U.S. Department of Agriculture forecasts Argentine soy
production in the upcoming season at 55 million tonnes, rising
from 41 million tonnes in 2011/12. 
    The flow of grains from the country is of interest to
exporters such as Bunge Ltd and Noble Group Ltd
, which operate gigantic terminals along the Parana
River, leading to the shipping lanes of the South Atlantic.
    Chicago corn futures are up 14 percent so far this year,
while wheat has risen 31 percent and soybeans 29 percent.
    More than 17 percent of Argentina's 2012/13 corn is already
in the ground, according to the Buenos Aires Grains Exchange,
and farmers start planting soy this month.
    Grain markets have meanwhile been shaken by the worst U.S.
drought in more than 50 years, which has parched crops in the
world's biggest corn producer. With global stocks sliding lower,
attention is fixed on No. 2 corn exporter Argentina.
    "The weather has complicated things in central Buenos
Aires," said Martin Fraguio, executive director of Argentine 
corn industry chamber Maizar. "Some farms were flooded and 
still have a high water table that inhibits planting."
    
    DOUBLE WHEAT WHAMMY
    Argentine wheat has already been planted and farmers are
evaluating damage done by recent floods, particularly in Buenos
Aires, which accounts for more than half of Argentine output.
    Low production was already expected as growers shifted
toward soy and other more profitable crops to avoid export curbs
on wheat and corn.
    Corn area is seen holding steady at about 5 million hectares
this season thanks to corn's higher profitability, while the
Agriculture Ministry estimates wheat area fell 20 percent this
season to 3.7 million hectares. 
    "On top of that, it rained too much during all of August and
part of September," said farm consultant Sergio Conterjnic, a
former head of the ArgenTrigo wheat growers chamber.
    "The flooding affected the heart of the wheat belt. We know
there will be losses but we still do not know how severe they
will be," Conterjnic said.
Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.