MercoPress. South Atlantic News Agency

Drought forces Argentine soy crop estimate down 16%

The extreme drought conditions which most of Argentina's rich farmland is suffering will have an impact on the soybean crop that is now estimated in the range of 40 million tons, down 16.7% from the previous crop according to the Argentine Association of Agriculture experimentation regional consortia, AACREA.

Argentina that is among the short list of world exporters of soy, in 2007/08 harvested 46.2 million tons. Aacrea added that with a forecasted dramatic drop in corn production, soy beans have become the farmers' last hope to save summer crops. However the German publication Oil World which keeps track of global production estimates that Argentina's crop of soy this season will reach 44 million tons, which is less that the original 48.8 million tons. "There's a great risk that rainfall in the two weeks before February 6 will be insufficient in most areas suffering from the drought", said World Oil in one of its latest situation reports. The German publication also estimates the Brazilian crop will be less than originally established: down to 57.5 million tons from 60.02 million tons. If these estimates prove correct global supply of soy from Brazil, Argentina, Paraguay, Bolivia and Uruguay would total 108 million tons, below the 115.8 million tons from the previous crop. With a smaller than expected production in Mercosur countries, United States would again emerge as the main soy bean supplier, which apparently already is having an impact in the futures market.