Report Highlights:

FAS Buenos Aires maintains its estimates for soybean area and production for marketing year 2013/14 at 20.5 million hectares and 57.5 million metric tons, respectively. Sunflowerseed area is adjusted downward by 200,000 hectares to 1.45 million hectares, the lowest area estimate for the crop in the past three decades.


Rainfall over the past three to four weeks has replenished reserves in soil throughout the main growing area of the provinces of Buenos Aires, Santa Fe and Cordoba. Soybean planting has picked up and according to the Ministry of Agriculture, almost one-third of the crop is in the ground. FAS Buenos Aires maintains its area estimate for marketing year (MY) 2013/14 at 20.5 million hectares. The Ministry of Agriculture estimates soybean area for MY2013/14 at 20.65 million hectares and the Buenos Aires Grain Exchange estimates production at 20.2 million hectares. There is unanimous consent among the industry that area will be above 20 million hectares, some contacts even maintain forecasts above 21 million hectares. Additional soybean area will come from area that is not planted to corn. Historically, producers in Argentina wait closer to planting time to decide what to produce based on current prices, input costs, margins, weather, policies, etc. This year during the dry spell in October, many producers who had intended to plant early corn missed their window because there was not enough soil moisture. Those same producers will either plant late season corn, which yields less, or plant soybeans. Some producers have already decided to plant soybeans. The issue this season is the fact that corn prices are dropping at a faster rate than soybean prices are dropping. This, along with higher costs of production for corn, makes corn a less profitable, more risky crop and it is likely many will switch to soybeans which have low input costs in comparison. Planting generally extends through December and January, so time will help to adjust the area estimate to more closely reflect reality. Production is forecast at 57.5 million metric tons based on average historic yields. If this is achieved, it will be a record soybean crop for Argentina.


Sunflowerseed area for MY2013/14 is dropped by 200,000 hectares to 1.45 million hectares, 200,000 hectares, the lowest area estimated in the last three decades. The contraction is due to several reasons. First off, Argentina’s major sunflowerseed competitors, Russia and the Ukraine, produced nearly 20 percent larger crops than during the previous year. The extra production contributed to a depression in international prices for sunflowerseed oil. Secondly, input costs are high, including both land rentals and crushing costs. With higher costs of production and lower prices, the margins are squeezed to a minimum, sometimes dipping in the red, leaving producers with negative returns. In addition, there are still issues with parrots and pigeons that attack the crop year-after-year both at emergence and towards the harvest. This has been difficult to control and sunflowerseed production in the heaviest hit provinces of San Luis and Entre Rios, has nearly disappeared. The Ministry of Agriculture maintains its area estimate at 1.36 million hectares and the Buenos Aires Grain Exchange recently lowered its estimate from 1.63 million hectares to 1.48 million hectares. Production is adjusted accordingly based on average yields to 2.7 million metric tons.


There are no changes for peanut production. The Ministry of Agriculture estimates that planting progress for peanuts is approximately 59 percent complete with 239,381 hectares planted out of the total 418,000 hectares estimated for MY2013/14. Many contacts in the industry estimate that peanut area will be between 300,000 and 350,000 hectares