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ARGENTINA | 11-01-2024 16:59

Argentina's best soy crop in five years set to be boon for Milei

Argentina is on course to produce its best soybean crop in five seasons – 52 million metric tones.

Argentina is on course to produce its best soybean crop in five seasons — 52 million metric tons — as El Niño-fueled rains water fields that were parched by several years of drought.

The forecast for the second-quarter harvest rose by four percent from a December estimate, the Rosario Board of Trade said in a monthly report. Output is poised to rebound after precipitation finally came to a vast western region of the Pampas crop belt.

“The change in the west has been notorious throughout the country,” analysts led by Cristian Russo wrote in the report.

An Argentine soy harvest of 52 million tons would surpass last year’s miserly crop by 160 percent, impacting not only benchmark futures trading in Chicago but also the chances that new President Javier Milei can turn around the country’s economy. That’s because shipments of the oilseed normally account for roughly a quarter of all the country’s export revenues.

Argentina is usually the biggest exporter of soy meal and soy oil, and the third-biggest corn supplier. But dryness last season was so severe that Brazil overtook it for the first time in 25 years as the world’s top provider of meal.

The Rosario prediction falls in line with estimates from Canada-based satellite analytics firm EarthDaily, which had recently increased its base-case Argentine soy forecast to 52.4 million tons.

The Rosario analysts also boosted their monthly corn estimate by 5.4 percent to 59 million tons, which would be a record crop, as moist soils catapult plants’ yield potential.

 

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by Jonathan Gilbert, Bloomberg

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