Argentina Falls Short Of Wheat Production For Marketing Year 2017-18, Estimates
Argentina is one of the top wheat exporters to India, this year’s low harvest area in Argentina has made a significant impact on its yields as well. Excess rains had also hampered the production of Argentinian wheat production this year. A reason for India to get little worried is, USDA has this is forecasted to cut potential exports, projected at 10.8 million tons, to 700,000 tons lower than USDA’s earlier estimates.
Wheat Production Estimates:
Post estimates Argentine marketing year (MY) 2017-18 wheat harvested area is at 5.2 million hectares, which is 400,000 hectares lower than USDA and production at 16.8 million tons, 700,000 tons lower than the official number given by Argentine government. This difference is primarily justified by a final lower planted area and the loss of 150-200,000 hectares due to flooding. The local wheat crop has so far developed in very wet conditions.
The planting season began with excess soil moisture, making many lots not being able to be planted. Winter, typically a dry season in Argentina, was very humid and temperatures were milder than normal, with very few frosts. Currently the general condition for wheat is good, although there are some doubts about the final quality which will depend on how high yields are and how effective was the application of fertilizers as continued rains could have leached out part of the applied nutrients. Most producers have been able to control effectively insect and disease attacks. Wheat harvest has slowly begun in Northern provinces with yields somewhat lower than earlier expected.
Exports in MY 2017-18 are projected at 10.8 million tons, 700,000 tons lower than USDA’s earlier estimates. This is a reflection of Post’s ‘expected smaller output’, a main reason for concern for India which imports grains from Argentina. Through mid-October, local exporters reported purchases of around 3.8 million tons of the new crop. The harvest of the new crop will be in full swing in the last part of November. Local exporters are expecting to increase wheat (and flour) shipments to Brazil in MY 17-18 due to the neighbor’s smaller wheat crop and also to lower exports from Paraguay. Watching the Argentine exports to Brazil in MY 16-17 which will be total 5.0 to 5.2 million tons of wheat and about 360,000 tons of wheat flour. Exports of wheat flour to Bolivia have also been significant in the current marketing year, with an estimated total export volume of about 300,000 tons, India must have plan B for wheat imports (if it is needed). In early October, the Government of Argentina announced that the country will ship for the first time 30,000 tons of wheat to Mexico in December. The two countries recently agreed upon phyto sanitary conditions.
