The lack of rain triggered by the La Nina weather phenomenon has prompted the Rosario Exchange to cut its forecast of Argentina’s 2017/2018 corn and soybean crop by 12% and 10%, respectively, making it one of the most bearish analysts in the market.
“The lack of water has cut (our previous projection on January 10 by) 5.5 million mt in soybeans, which stands at 46.5 million mt, and 4.9 million mt of corn, which stands at 35 million mt,” the report released Wednesday said.
The figures compare to the 2016/2017 harvest of 57.8 million mt for soybean, down almost 20%, and 41 million mt for corn, down almost 15%.
Saying the conditions were the worst in 10 years, the exchange pointed out the cultivated area for soybeans was cut to 18 million hectares from 18.5 million hectares six weeks earlier for the 2017/18 harvest.
Soy yield estimates were cut to 2.68 mt per hectare, down from last year’s national yield of 3.2 mt per hectare, while corn yields were also cut to 6.44 mt per hectare, down from 7.35 mt per hectare.
However, the exchange warned that further cuts, particularly to the corn crop, could be made if the hot dry weather continued.
“It is important to remember that late maize make up 54.2% of the area sown with this cereal, and a good part of it is facing its flowering period without water, putting pollination at risk,” the report said.
“Therefore, it is essential that the rains return in the next seven days. If not, the lots destined for grazing will increase”.