Mar 05, 2018

Crop Situation in Argentina continues to Deteriorate

Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.

The situation in Argentina is bad and getting worse. I would have to say that Argentina is quickly approaching the "worst case scenario." I think it is comparable to the 2012 growing season in the United States with two differences. The growing season in Argentina started off with good soil moisture during August-September-October, whereas the 2012 growing season in the U.S. started off dryer than normal. The soils in Argentina hold water very well so it took a while for the subsoil moisture to be depleted. That is why the early planted corn and soybeans are doing better than the later planted corn and soybeans.

Another difference is that the temperatures in Argentina have been hot, but not record hot like we saw in the U.S. in 2012. As a result, the situation in Argentina probably has not been as bad as the 2012 growing season in the U.S, at least up until this point, but I now think the two growing seasons are comparable.

The weather in Argentina has gotten worse as the summer has progressed. The three summer months (December-January-February) have been the driest in several decades and February has been the driest in many decades. Last week was hot and dry again with only light scattered showers in the main production areas. There was some rain across the far northern regions of Argentina along the border with Paraguay. The forecast is calling for a few widely scattered showers across the main production areas with a little better rains across the far northern regions again, but there is not enough rain in the forecast to reverse the current trend.

In their latest weekly report, the Buenos Aires Grain Exchange slashed their estimates for the 2017/18 Argentina soybean estimate by 3.0 million tons to 44.0 million. The soybean estimate is now 13.5 million tons below last year's production. The estimate for the 2017/18 Argentine corn crop was left unchanged at 37.0 million tons.

The Grain Exchange is now rating the soybean crop in general as 45.3% very poor, 30.7% poor, 21.1% fair, 2.6% good, and .3% excellent. The early planted soybeans are rated 72% poor to very poor, whereas the later planted soybeans are rated 85% poor to very poor. The earlier planted soybeans had relatively good weather last September and October, but the later planted soybeans have endured adverse weather ever since they were planted.

The soybeans in general are 35% filling pods and 5% mature, so the next few weeks will be critical for determining the final soybean yield. The soil moisture for the soybeans is rated 52.9% very short, 34.1% short, 12% favorable, 0.8% optimum, and 0.2% wet.