MercoPress. South Atlantic News Agency

Argentina and Paraguay, wheat and soybean crops victims of ongoing drought

Farmers in Argentina still waiting to begin planting wheat

Drought is causing havoc in Argentina and Paraguay. Argentina’s wheat crop for the 2022/23 season is the most delayed in a decade, as a period of lack of rainfall and early frosts is forcing farmers to delay planting the winter crop.

Likewise in Paraguay the Grains and Oilseed Traders Association reported that the country's soybean exports have been cut in half because of severe adverse climate conditions for the summer 2021/22 oilseed crop

In Argentina the Rosario Grains Exchange said farmers are waiting for better climate conditions, while the Buenos Aires Cereal Exchange said it could again have to cut its estimate of the area that will be planted with wheat in the 2022/23 season, currently at 6.3 million hectares, if in the short-term rains do not bring relief to agricultural areas suffering from dry conditions.

A downgrade in the Exchange’s estimate would be the entity’s fourth since May. Argentina is the world’s fifth-largest exporter of wheat, moving up one position in the ranking prepared by the U.S. government agriculture department due to a sharp drop in the forecast for Ukraine’s cereal exports due to the war with Russia.

From Asunción, a foreign trade report from the grains and oilseed traders association, CAPECO, shows that soybean exports from Paraguay decreased by 50.5% in May 2022 to 1,638,763 tons compared to the same period in 2021, when the volume reached 3,309,615 tons.

According to Sonia Tomassone, Capeco’s Foreign Trade Advisor, the total exported in May represents half of what was shipped in the fifth month of 2021 due to a drastic output decline caused by weather conditions during the 2021/2022 harvest.

Capeco also highlighted that the loss in soybean exports and derivatives from Paraguay can be expected to continue to deepen in coming months due to the poor availability of supply caused by the decline in production triggered by the acute drought at the start of the year, and very cold temperatures currently.