Argentina wheat area, production forecast to increase

Argentina's wheat area has increased anywhere from 3-10pc, with production increasing by 20pc, because of recent favorable factors, market participants said at an industry conference this week.

Market participants representing wheat and barley producers, traders and buyers attended The Argentina National Wheat Congress on 9-10 May in Mar del Plata.

The Buenos Aires Grain Exchange (Bage) presented forecasts for wheat and barley production for the 2024-25 marketing year. Bage forecasts 6.2mn hectares (ha) planted with production estimated at 18.1mn t for 2024-25 compared with 5.9mn ha planted and production of 15.1mn t for 2023-24.

Barley production is forecast to increase to 5.1mn t on 1.3mn ha planted compared with 5mn t produced and 1.25mn ha planted in 2023-24.

The Secretary of Bioeconomy anticipates wheat area at 6.1mn ha while other presenters and panelists spoke of potentially 6.7mn ha and production of 20mn t in a best case scenario.

Argentina will begin to plant its wheat and barley within the next several weeks and several factors have turned positive recently.

The Argus assessed price of Argentina's 11.5pc wheat has increased 14pc since the beginning of the year following the global market as weather issues in Russia and the US have caused global prices to rise.

On a more local level, soil moisture in the major wheat growing areas of Argentina have improved significantly. While the rains in April and May have delayed the corn and soybean harvest, it will benefit wheat planting.

For 36pc of the wheat area, water availability is currently over 80pc compared with less than 20pc a year prior, according to Bage.

The Argentinian government has also recently eliminated import duties on UAN and urea with fertilizers being a major cost of wheat production.

Market participants are also anticipating an increase in Brazil's wheat imports from Argentina due to the recent flood in Rio Grande do Sul, Brazil's largest wheat producer. Participants expectations are for Brazil to plant less wheat due to the effects of the floods.

By Eduardo Gonzalez