Argentina: Wake Up And Smell The Coffee, Before It Runs Out
The Argy Ag Secretariat has slashed its 2009 wheat production estimate to 8.3mmt following a year of drought conditions in the country.
This is the lowest estimate yet for the current crop, and is 7.7mmt lower than the output in 2008 of 16mmt.
I think that this graphically highlights exactly how bad things are in Argentina, a situation I believe that most of the trade has so far been ignoring.
Yes the global economy is in very bad shape. But for heavens sake wake up & smell the coffee. Before it runs out.
Argentina has just finished harvesting a wheat crop almost half of last years. It has also just finished planting a soybean crop in the same ground, in the same drought situation, with a twelve month deficit of soil moisture. Exactly how well do you think that that is going to yield? With no water and no fertiliser?
Incidentally, Argentina was the world's fifth largest exporter of wheat last year. With a domestic consumption of around 7mmt, in 2009 it now has an exportable surplus of just 1.3mmt, a third of that of the UK!
The Ag Secretariat also today lowered the soy planted area to 16.5m ha from 17.8m ha and for corn to 3.4m ha from 3.5m ha.
Argentine soybean production in 2009 could be 15-20mmt down on current projections from the USDA.
The Brazilian crop is holding up comparatively well, but take 15-20 million off the table, that is one very significant reduction in global supplies.
This is the lowest estimate yet for the current crop, and is 7.7mmt lower than the output in 2008 of 16mmt.
I think that this graphically highlights exactly how bad things are in Argentina, a situation I believe that most of the trade has so far been ignoring.
Yes the global economy is in very bad shape. But for heavens sake wake up & smell the coffee. Before it runs out.
Argentina has just finished harvesting a wheat crop almost half of last years. It has also just finished planting a soybean crop in the same ground, in the same drought situation, with a twelve month deficit of soil moisture. Exactly how well do you think that that is going to yield? With no water and no fertiliser?
Incidentally, Argentina was the world's fifth largest exporter of wheat last year. With a domestic consumption of around 7mmt, in 2009 it now has an exportable surplus of just 1.3mmt, a third of that of the UK!
The Ag Secretariat also today lowered the soy planted area to 16.5m ha from 17.8m ha and for corn to 3.4m ha from 3.5m ha.
Argentine soybean production in 2009 could be 15-20mmt down on current projections from the USDA.
The Brazilian crop is holding up comparatively well, but take 15-20 million off the table, that is one very significant reduction in global supplies.
