Argentina farmers sell 16% of 2017/18 bean crop forward: BCR

Soybean farmers in Argentina have sold forward 8.2 million mt of the current soybean harvest out of a possible 52 million mt, according to the Rosario Board of Trade, up from the 5 million mt five-year average for this time of year.

But while exporters have bought the volume, they have committed nothing for export so far, which is unusual for this time of year, when commitments abroad can be already as high as 1.5 million mt.

Argentina’s exports are expected to be 8.5 million mt, according to the USDA, and the country is facing its lowest soybean crop in five years as the La Nina weather phenomenon has reduced moisture levels in key planting areas.

That is expected to result in a sub-50 million mt crop – a concern that could see exporters hold fire for several more weeks.

The Rosario Board of Trade will revise its estimate of the Argentinian crop on Monday and its head of research, Emilce Terre, told Agricensus it will be revised downwards from its 52 million mt forecast.

“Those (export) sales were made when the old crop was not sold and the price of the coming crop seemed good considering that good production was expected,” said Pablo Pochettino, a Rosario-based grain broker with brokerage Intagro.

“But as the drought was advancing those sales were paralyzed and today the pace of sales is very slow. It would not be surprising to see that with the passing of the weeks the pace of sales is late compared to other years,” he said.

Added to that is the steady erosion of export taxes, which currently stand at 29% and are falling incrementally at 0.5% per month.

In terms of corn, farmers have sold 6.5 million mt of the new corn crop forward, although only 1 million mt has been committed for export.

That compares with an historical average of 5.5 million mt committed for export at this time of year.