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Argentina exchange warns more wheat cuts likely as yields disappoint

Argentina’s wheat production outlook is likely to face more cuts due to lower-than-expected yields, the Buenos Aires grains exchange said, as the harvest of the grains advances in the midst of a prolonged drought.

In a weekly crop report, the exchange said 2022/23 wheat production, which it current estimates at 12.4 million tonnes, is showing “yields below expected” as the harvest gained pace.

“If this trend continues, it could affect our current estimate,” the exchange said.

At the beginning of the campaign in May, the exchange had estimated a wheat harvest of 20.5 million tonnes. However, since then drought and frosts have hit the crop hard. Argentina is a key global exporter of wheat, as well as soy and corn.

Until Wednesday, Argentine farmers had harvested 23% of the wheat planting area, a 22 percentage point delay versus the harvest a year earlier.

The exchange added that the delayed planting of 2022/23 soybeans, estimated at 16.7 million hectares, was still being held up by “the lack of surface humidity and high temperatures”, despite some rains in recent days.

Soybean planting, it said, was 29.1% complete, but 17.2 percentage points behind the previous season overall, and more than 30 percentage points behind in some regions.

Corn planting for the 2022/2023 season is 25.4% complete on the 7.3 million hectares projected, the exchange said, while producers have begun to sow batches of late-planted corn.
Source: Reuters (Reporting by Maximilian Heath)

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