SUBSCRIBE NOW 3 months just 99¢/month

ADVERTISEMENT

ADVERTISEMENT

Argentina rains cap crop losses from drought, weather experts say

The long spell of dry weather, brought to end by rains arriving earlier this week, had led the Rosario grains exchange to slash its forecasts for corn and soy harvests.

Soybeans
Soybeans and corn in Argentina took a hit from extended drought conditions, but rain now seems to have stemmed further losses.
Agweek file photo
We are part of The Trust Project.

BUENOS AIRES — Argentina, a major grains exporter, is set for further abundant rains in the coming days and a likely near-average month of precipitation ahead, weather experts said, which should cap recent crop losses from an extended drought since December.

The long spell of dry weather, brought to end by rains arriving earlier this week, had led the Rosario grains exchange to slash its forecasts for corn and soy harvests.

Argentina relies heavily on farm exports for foreign currency and is currently locked in talks with the International Monetary Fund to revamp more than $40 billion of debts it cannot pay and needs to bolster reserves and reduce its fiscal deficit.

Weather experts said that the rains should halt losses to soy and corn crops, though some irreversible damage had already been done.

Cristian Russo, head agronomist at the Rosario exchange, said he sees a shift towards favorable weather patterns for the remainder of the 2021-22 campaign.

ADVERTISEMENT

"There was a change in the dynamic and that change means we won't have to make a similar cut in the near future in Argentina and the situation will probably not get worse," he said, adding though that he did not expect losses to be recovered.

The world's top exporter of processed soy, and second of corn, has been hit by a double whammy of La Nina climate patterns in the last two years, which generally lead to less rainfall in the core farm belt.

Germán Heinzenknecht, meteorologist at the Applied Climatology Consultancy, said the impact of the current La Nina would likely fade over the next month, a key period for the development of soy, with rains only slightly below average.

"I think we can get around 100 millimeters in general, with corridors where the outlook can be more generous. With La Niña in decline, if this dynamic continues, we will be fine, discounting the damage already caused," he said.

Late soybean and corn crops being planted now will need water in the coming weeks but will avoid the impact of the drought that hammered early-planted corn in particular.

"The rains are expected to continue this week. The accumulated rains between the weekend and next week are between 70 and 80 mm in the core agricultural area," said Leonardo De Benedictis, an independent meteorologist.

"Then it may rain a little more at the end of the month."

(Reporting by Maximilian Heath; Editing by Kirsten Donovan)

Related Topics: MARKETSCROPSCORNSOYBEANS
What to read next
Meteorlogist and commodity trading advisor Jim Roemer is the owner of Best Weather Inc., and co-founder of Climate Predict, a long-range global weather forecast tool.
The markets — and the wheat markets in particular — started off on fire this week, said Don Wick of the Red River Farm Network. But as he and Randy Martinson of Martinson Ag Risk Management discussed on this week's Agweek Market Wrap, sponsored by Gateway Building Systems, most of the gains were lost by the end of the week.
The weather and various USDA reports continue to be the main drivers in the markets.
Even as the central and eastern parts of the Corn Belt finally are making some planting progress, the western Corn Belt and northern Plains remain mired in wet, cold weather that has kept tractors at a near-standstill, especially in North Dakota and Minnesota, Don Wick of the Red River Farm Network and Randy Martinson of Martinson Ag Risk Management discussed on the Agweek Market Wrap.