Net exports of the main agricultural complexes are expected to hit a low in more than a decade

Fewer tonnes exported and falling prices sharply cut net agricultural exports. This year, total exports are expected to fall by at least 21%.

The effects of the severe drought and the three consecutive Niña years continue to be reflected in production and export statistics. The significant reduction in soybean, maize and wheat harvests is having a major impact on foreign trade. In the 2022/23 season, we have almost 22 Mil Mt less soya, 19 Mil Mt less maize and a fall of 11.5 Mil Mt of wheat compared to the production volume of the 2021/22 harvest. Moreover, the balance volumes, in addition to distorting the functioning of markets, limit exports of Argentine agricultural products, which necessarily contributes to the export cutback. In this context, the latest GEA production updates and the national economic outlook make it necessary to adjust BCR export estimates.

Not satisfied with the fall in exports in tonnes, the downward trend in international prices of agricultural chains also pushes to the adjustment of national exports. Consequently, foreign sales of the main agricultural chains are cut by 11% with respect to the last estimate. With this projection, these chains would see a 42% drop in exports in 2023 compared to 2022.

In this way, exports are cut by nearly US$ 2.3 billion compared to last month’s estimate. With this preliminary number, Argentine exports in 2023 would fall by at least 21.6% compared to the 2022 level.

Maize harvest progresses, still below previous years

The historic proportion of late corn explains a pace of corn harvest comfortably below previous years. However, in the next two weeks it is expected that the late harvest in the Core Zone will be strongly activated, which could soon cut this relative delay.

The advance of harvest could give impetus to the marketing of corn, which has 35% of its production already marketed, totalling 13.5 Mil Mt as of 07/06. This pace of sales is below the levels of previous years. At this point last year, half of the maize crop had already been bought, with almost 28 Mil Mt of maize. Moreover, of the total bought this year, about 4.6 Mt are not priced. Although this number is lower than the 6.6 Mil Mt that were not priced last year, the proportion of unpriced purchases this season is higher than in previous years. Thus, 34% of the maize bought today has no firm price, up from 24% last year and 18% of the average of the last five years.

Against this background, the Physical Grain Market of the Rosario Stock Exchange has been showing an interesting commercial dynamism. The physical prices of maize have been falling as the months go by, discounting the volume of late maize that is expected soon. On the other hand, soybeans show a very discreet trading volume.

Source: https://bcr.com.ar/

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