Argentina Latest
10/01/12 -- Will it, won't it? There are a few subtle changes again today to the latest GFS weather maps for Argentina. For your personal guidance once again here they are stitched together along with the maps from Saturday to show any appreciable difference.
Saturday's forecasts for Weds, Thur, Fri are the left hand column with today's revised maps in the right hand column.
Clickety click
Argentina
09/01/12 -- Reports this morning suggest that the GFS model is showing less rain for Argentina today than it did on Friday, and that is being cited as the reason for the overnight grains firmness this morning.
My little animation that I created over the weekend, highlighting where and when the rains are/were due means that I've still got copies of Saturday's GFS maps on my PC. Out of interest, I thought I'd compare these to today's revised maps to see just how different they are.
The answer seems to be "not a great deal" if you ask me. Here's a link so you can make your own mind up with Saturday's maps for Weds, Thur and Fri down the left and today's down the right:
Spot the difference
Argies, Huh Good God, What Are They Good For?
30/11/11 -- As well as deliberately handling the ball in the penalty area, petulantly refusing to come on as a substitute and eating guinea pigs what else are the Argies famous for? Strikes, yes go on then I'll grant you that one. Anything else?
Well, they can grow a decent crop when they turn their minds to it, and when Mother Nature co-operates. They appear to be planning on doing the former and hoping for the assistance of the latter this year.
The Ministry are forecasting a bumper 52-53 MMT soybean crop in 2011/12, second only to production in 2009/10.
In addition to that they say that corn output next year will come in at a whopping 30 MMT, an increase of a third on 2010/11 and the highest in history by a considerable margin.
They've also upped their wheat production estimate for 2011/12 from 12 MMT to 13.5 MMT, saying that old crop exports will now total 11.1 MMT, far higher than the USDA's 7.7 MMT estimate.
The Ministry then went on to say that they didn't refuse to come on in the second half, they just couldn't understand what the manager was saying and it's not their fault that their family is so far away, and think of the children and they don't want a transfer, they want to be with their family, who live far away, and they miss their family, so they do want a transfer, but not for any reason other than their family, which is very far away, we are good honorable Ministry, we love our family, we die for our family, we very very sad to not have family here on substitutes bench with us so we must go home to family even though it breaks our hearts. And they think that they've left the kettle on by mistake, so must go now, cannot wait until January. Let go of my leg, oh family, you tear my heart out with rusty scalpel, just please let me go to family. Sob. Look, I try to cut my head off for family once before see here gringo.
The Jury Is Out On Argy Wheat Plantings
31/05/11 -- Opinion is divided over Argentine wheat prospects for 2011/12 with planting now underway. The Ag Ministry there peg the wheat area for the coming season at 5 million hectares, a 6% increase on the 4.7 million sown in 2010.
The Buenos Aires Grain Exchange concur, pegging the planted area at 4.95 million. The Rosario Grain Exchange however say that wheat plantings will fall 10% on continued farmer dissatisfaction with government tinkerings with export quotas and taxes.
Argentina To Produce Near Record Wheat Crop In 2011/12
04/05/11 -- According to my chums at the excellent FCStone World Food Production Blog, Argentina is set to produce a possible 18 MMT wheat crop in 2011/12.
That would be an increase of around 20% on this season, and herald a return to the halcyon days of the "mid-noughties" when the country regularly featured amongst the world's top exporters of the grain.
In fact production at that level would be second only to output in 2007. "Argentine farm groups and analysts are hopeful that high wheat prices will spur a substantial increase in plantings (and output) for the ‘11/12 wheat crop," they say.
Wheat production has been slashed in recent years on a combination of eighteen months of drought and farmer dissatisfaction with government tinkerings with exports.
Planting begins this month and harvesting begins at the end of the year.
Argentine Rains A Game Changer For Soybeans
02/02/11 -- Reproduced by kind permission of my chums at the excellent Martell Crop Projections:
Drenching January rainfall in Argentina significantly improves the outlook for late planted soybeans that fill pods in February-March. It was enough rain to completely restore topsoil moisture. The January rainfall map now is wetter than normal in Cordoba and Santa Fe, key soybean provinces, following 4-5 inches of rainfall last weekend.
The recuperative powers of soybeans are well documented in the United States Midwest. If heavy rain arrives in time for pod setting and filling, soybean yields increase even if very dry conditions existed previously. Pod setting and filling is the period when yields are made or lost. Very heavy rain increases both the number and size of soybeans in the pod. In the Midwest this critical stage is in August. For Argentina February-March is the rain-sensitive period.
Included in this report (you'll have to subscribe using the link above if you want to see it - Nogger) is proof of Iowa soybeans responding to heavy late-summer rain, while corn floundered. The year was 1977. Conditions had been extremely dry May- July, damaging corn beyond repair. The corn yield finished 11% below trend. Soybeans rebounded making a productive yield 3% above trend. August rainfall was 7.8 inches and 195% of normal.
Slower than normal Argentina soybean planting rates may prove to be a blessing. Forty percent of beans were sown after December 1, based on Ministry and Agriculture reports. These late planted soybeans would bloom in February. Pods are “set” 10-12 days after blooms develop. This is followed by 30-40 days of seed filling. The message: There is still a lot of time left for late developing soybeans to improve, if heavy rain continues.
Drenching rainfall is Cordoba and Santa Fe over the weekend was preceded by drought-breaking rainfall in Buenos Aires province two weeks prior. We get the impression the weather pattern is changing. The sudden changeover toward wetness may be linked to a weakening La Nina. Drought is very typical with La Nina in Argentina. This country is one of the more sensitive areas where weather responds strongly the ENSO fluctuation. Last year with El Nino, conditions were extremely wet, causing concerns over disease in soybeans.
Warming sea temperatures developed at the same time in the sentinel eastern tropical Pacific Ocean, signifying a weakening La Nina. What we do not know is whether this is a short-term fluctuation or the beginning of La Nina’s demise. The Australia Bureau of Meteorology suggests the La Nina may continue throughout calendar year 2011. Should this be the case drought may resume in the Argentina grain belt.
Argentina Set For A Deluge
24/01/11 -- Parts of drought parched Argentina are in for a serious soaking, with more a foot of rain suddenly in the forecasts for the next fortnight.
"In an amazing turn of events in Argentina, some of the driest areas (where seasonal rains have been eight inches below normal and drought conditions categorized as “extreme”) will see two week rain totals of 8-14 inches. This very wet weather begins late Tuesday and lasts (at least) into early February," says QT Weather.
The market either hasn't heard or doesn't care, with the overnights up around 8-10c on beans.
Strike!
12/01/11 -- Yes that is the General Belgrano just before it went to sleep with the fishes.
Our bezzie hand-ball loving mates the Argies have decided to do what they do best/ Finding themselves with a bit time on their hands just as the wheat harvest is almost over and before the soybean/corn harvest begins. That's right folks they're going on strike.
Argy farmers will launch a one week strike starting Monday in protest to government limits on grain exports - sound familiar?
Front-end premiums here we come again then by the looks of it.
Very Interesting, Mr Bond
10/01/11 -- The Argy soybean crop "isn't likely to top 40 million tons" whilst corn output "is unlikely to top 17.5 million tons this season" according to this report quoting Argy analysts AgriPac.
That would certainly set the cat amongst the pigeons if true, with the USDA currently predicting 52 MMT and 25 MMT respectively.
Although it doesn't say so on the website this is actually a Dow Jones Newswires story, not one made up by some Indian outfit that you've never heard of, which should lend the report some credence.
Knocking 12 MMT of soybeans and 7.5 MMT of corn off the global bottom line in 2011 would certainly tighten the supply screw a whole lot more.
Argie Spoilsports
13/12/10 -- The Argentine authorities appear to have made taxation on grain exports so punitive that tax evasion has become a national pastime.
According to this report, the county's national tax agency says that four of Argentina's top ten grain exporters didn't pay a peso in income tax last year. Link here: Taxi!
Consequently the slippery Argies have signed a deal with China to attempt to clamp down on the issue via the backdoor.
Argy Wheat Planting Finished
Argentine farmers have finished their wheat plantings and can expect a crop of "at least 11.3 MMT" according to the Buenos Aires Grains Exchange. That's an increase of more than 50% on last season's crop.
Planted area is seen at 3.2 million hectares by the Exchange, more than 30% up on last season when sowings slumped to just 3.2 million hectares on drought and farmer dissatisfaction with on-off government export meddling.
Corn plantings are 26% done and are expected to cover 3 million hectares this season, 11% up on last year.
Argies Look To Cash In On Russian Misfortune
Argie wheat growers are overdue a slice of fortune, after two years of sharply reduced production due to drought and internal squabbling with the government took them from hero to zero on the international export stage.
A crop of 18.6 MMT in 2007/08 saw Argentina export of 11.2 MMT of wheat, comfortably sited in fifth place in world export rankings.
Two successive years of drought-affected output, and lower plantings due to growers dissatisfaction with intermittent export bans, saw production slump to around 7.5 MMT (according to just about everybody except the USDA).
However, perked up by the sight of soaring world prices, Argie farmers are said to have staged a last minute rush to plant wheat pushing the area for 2010/11 to an estimated 4.3-4.5 million hectares.
Given favourable weather between now and harvest this season's crop could reach 13-13.5 MMT, and increase of as much as 80% on last year.
Another Argy Strike On The Cards
The workshy Argies are at it again I read. Port inspectors in Argentina are planning an indefinite nationwide strike starting Monday in a dispute over pay.
Is it a coincidence that the latest action dovetails nicely with an opportunity for them to put their feet up, sink a few beers and watch their team in action in the World Cup?
Don't be surprised to see a deal agreed minutes after the tournament is over. Meanwhile however the move could bring further spot tightness to the soymeal market in Europe.
Argy Farmers Set To Ramp Up Wheat Production
Before the soybean and corn harvest is even out of the way Argy farmers are already considering their options for winter wheat planting.
Two years of successive drought and a general level of dissatisfaction with government restrictions on exports have seen plantings and production fall steeply since a 6.6 million hectare and 18.6 MMT crop in 2007/08.
Production last season was only 7.5 MMT by common consensus off around 2.8 million hectares. (Curiously, and as a separate issue the USDA still have significantly higher production and acreage figures for last season and even the season before than everybody else in Argentina).
Argy exports were 11.2 MMT in 2007/08, but are set to fall by around two thirds to just 4-4.5 MMT in the current marketing year. Lower exports means lower revenue for the government, and growers are cautiously optimistic that export taxes and other restictions will be eased to encourage more plantings for 2010/11, which gets underway next month.
The weather is also a crucial factor, and near ideal growing conditions for soybeans and corn this summer, boosted by beneficial El Nino induced rains have hopefully put the two year wheat jinx to bed.
There are of course additional rotational benefits to giving wheat another chance again this time round too.
It's very early days yet, and there are some very wide apart estimates kicking around at the moment, but all this points to planted area jumping significantly this year.
Anything like normal yields could potentially see the crop double in size to around 15 MMT. Some estimates are even higher, 17.7 MMT is one I've seen, that would represent an increase of 136% on last season. The latter would surpass domestic usage by well over 10 MMT, potentially propelling Argentina back into the world's top five global wheat exporters.
Strike Over, Problem Sorted, Right?
Well those naughty militant Argy dock workers didn't quite get everything they asked for. They had to compromise a bit on their outrageous 100% pay increase demands and settle for a reportedly "more modest" 27% rise instead.
So that's the end of that then, eh? You'd certainly think so judging by Chicago's reaction to the news last night with front month beans down 33 cents and meal shedding USD17.30.
Of course that isn't going to do diddly squat to get any Argy beans or meal to Europe any quicker until the very end of April at the earliest. Acute congestion problems, accentuated by the record crops there, will keep loading delays to at least two to three weeks - and quite possibly more then that as the season wears on.
The fashion for chartering boats to load in both Argentina and then Brazil before sailing for Europe is hardly going to hurry things along either.
Oh, and there's another problem, suppose you were a docker in other parts of Argentina (of Brazil), and your compatriots in Rosario have just had a 27% increase for the sake of a ten day strike. I think that you might fancy a piece of that action as well, might you not?
And I guess that the truckers could do with some extra folding stuff too? Then there's the mood amongst the pot banging, tyre burning farmers to consider - losing 35% to the government in export tax on every soybean exported.
It's not over 'til the fat lady sails. Talking of Mrs N#1, oooh no missus don't, nay nay and thrice nay it's not her fault she's big boned. I wouldn't exactly say she was fat, but she did have her own postcode. She used to wear two watches you know, one for each time zone she was in.
Let Them Eat Fish
Argy President Cristina Fernandez has had a bight idea. Rolls eyes, a woman with a bright idea, go on then what is it. More shoe shops on every street corner?
No, she's come up with a plan to sell discount haddock to the local populace in Buenos Aires as a fleet of trucks tour the capital emblazoned with the slogan "Now There's Fish For Everyone".
The famously carnivorous Argies are somewhat bemused, but faced with the soaring price of domestic beef, quite a few are reportedly tempted to give haddock a chance.
The "funny coloured" haddock comes in frozen brick-like slabs, I can see you licking your lips and reaching for the Rick Stein book already. Ice cold lager mixed with plain flour and a pinch of salt makes a very good beer batter I can tell you.
Despite the less than appetising description some reports suggest queues of "thousands" lining the streets to buy something they can at least afford.
Fernandez, keen to promote the idea, has visited one to make a purchase herself. I'm sure Nestor was chuffed to bits with his tea that night.
Can you smell fish?
Argy Soy Harvest Underway
Harvesting of what is roundly expected to be a record soybean crop in Argentina this year is just about underway, although heavy rain is dogging early progress, according to the Ag Ministry.
The corn harvest which began a week or two ago is currently around 11% complete, with the sunflower harvest 40% done, the Ministry added.
The typically cagey Ministry haven't issued a soybean crop production estimate, but say that the planted area is 18.2 million hectares. The corn crop will come in at 19-21 MMT and the sunflower harvest at 2.2-2.7 MMT, they say.
A corn crop of 20 MMT would be a 59% increase on last season's 12.6 MMT and a sunflower crop of 2.5 MMT would represent a 14% reduction on last year's output of 2.9 MMT.
The USDA currently peg the soybean harvest at 53 MMT, 66% higher than the drought-ravaged 32 MMT produced in 2009. They say that the planted area was 18.8 million hectares, a clear record, and 17.5% more than the 16 million hectares planted for 2008/09. Soybean area has been increasing steadily in recent years:
Argentine Corn Crop 19-21 MMT - Ministry
The Argentine Ag Ministry say that this season's corn crop will total 19-21 MMT, up sharply from last season's production of 12.6 MMT as "excellent" crop conditions lead to high yields.
That is their first estimate of the season, and comfortably outstrips the USDA's 17.2 MMT, and compares favourably with the Buenos Aires Grain Exchange's latest estimate of 19.3 MMT.
Also of interest is their wheat production estimate of 7.5 MMT, very similar to the Buenos Aires Grain Exchange's 7.44 MMT, although the USDA surprisingly raised their production number to 9 MMT last week.
Sunseed production will total 2.2-2.7 MMT say the Ministry, a little higher than the Buenos Aires Grain Exchange's estimate of 2 MMT.
The Ministry didn't estimate soybean production, but said that the planted area for beans was a record 18.2 million hectares.
Some Like It Hot
Have I mentioned before how good (and amazingly free) MartellCropProjections.com is? How she manages to do it for FREE, I've got no idea, poor Gail isn't even forced to carry ads from a motley selection of ne'er-do-wells or beg for beer donations, like some.
The first little signs of a slight problem for soybean production in South America are just starting to filter through. They love a good drought in Argentina, as we all know. If they aren't handling the ball into the net, or walking around the streets of Buenos Aires banging pots and pans, or setting fire to a pile of tyres in a roadblock then drought is what they do best.
Extremely hot weather began yesterday in the Argentina grain belt, increasing stress on developing corn and soybeans, says Gail. The heat wave will last for at least a week. Afternoon highs will be in the mid 90s F most days but could rise above 100 F Monday and Tuesday next week. High humidity will keep nights unseasonably warm in the 70s F, very negative for crop development, she adds. 
Scattered showers, some heavy, will occur in Buenos Aires along an unstable weather front this weekend but Santa Fe and Cordoba will miss out on the best rainfall, warns Gail. Stored ground moisture will support crop growth for a while, but field moisture will decrease with intense heat and insufficient rain, she concludes.
It's a long way from being a crop pillager just yet, but a situation that certainly wants keeping an eye on.
Argentina: Ag Ministry Cut Soybean Acreage Estimate
According to the Ag Ministry Argentine farmers will plant 18.2 million hectares of soybeans this season, 0.3 million less than their previous forecast, with plantings 64% complete so far.
The revised acreage estimate is 600,000 ha less than the USDA's current prediction, and 800,000 ha below that of the Buenos Aires Grain Exchange.
Even so, the Ministry estimate would still be a record, easily beating the 16.6 million ha sown in 2007/08.
They clearly see less of a switch into soybeans from corn than the BAGE, pegging corn area this season at 3.16 million ha, a drop of less than 10% on last season. The BAGE have corn acres falling substantially to 1.875 million ha, 45% down on year ago levels, partly after soil conditions were largely too dry to plant in September and October.
The ongoing conflict between farmers and the government, and lower input costs for soybeans, are also likely to have been a significant factor.
With the country likely to be only barely self-sufficient in wheat this season, with a crop of around 7 MMT, maybe a tad more, it seems that the Ministry are using a bit of artistic licence in calling the corn crop higher than it actually is. Lying is another way of putting it.
Having periodically slapped export bans (or quotas as the government like to call them) on both corn and wheat in the last couple of years, Argentine farmers are acutely aware both those commodities are likely to be short supply again this season. Therefore earnings potential from those crops is likely to be severely curtailed, as exporters who can't export don't buy.
Whilst the hefty export tax on soy still remains in place, despite all the farmers' protestations, the crop still offers significantly higher potential returns than planting corn.
The Ministry say that 76% of the corn crop has been planted to date and that the crop "is in good or excellent condition" - but then again you wouldn't expect them to say anything else would you?
In this case 76% of the crop might in reality be as good as it gets.
