Nov 16, 2021

2021/22 Argentina Corn 29.0% Planted vs. 37.5% Average

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

The 2021/22 Argentina corn was 29.0% planted as of late last week compared to 31.2% last year and 37.5% average. This represents an advance of only 0.6% for the week. The corn was 85-90% planted in the core production regions, 30-40% planted in southern Argentina and 0% planted in far northern Argentina. The early corn was 60.9% planted compared to 69.6% average.

The corn in Argentina was rated 0% poor/very poor, 16% fair, and 84%good/excellent. The good/excellent percentage was up 2% from the prior week. The soil moisture for the corn was rated 11% short/very short and 89% favorable/optimum. The favorable/optimum percentage was up 4% from the prior week.

The first phase corn showed some improvement last week, but early November is not the critical time for the crop. That comes in December and January when the corn pollinates and starts to fill grain, so I decided to leave the corn estimate unchanged while we wait to see how the weather develops. Besides, the first phase corn crop is only about 30% of Argentina's corn production.

As much as 70% of Argentina's corn will be planted during the second phase of planting starting in about two weeks. If verified, this would be the highest percentage of corn ever planted during the second phase. Some farmers in Argentina may have decided to plant less of their corn during the first phase due to forecast for dryer-than-normal weather during November-December-January when the first phase corn will be pollinating and filling grain.

It remains to be seen if the second phase corn will encounter better weather when it is pollinating and filling grain during February and March. The second phase corn in Argentina generally has a lower yield potential due to shorter days during its reproductive cycle, but sometimes the second phase corn can outperform the first phase corn.

Argentina's Urea Problem - Urea is the most common nitrogen fertilizer in the world and due to a series of events in recent months, the price of urea has skyrocketed. Urea represented 40% of all the fertilizers used in Argentina in 2020/21. All nitrogen fertilizers combined represent about 56% of all the fertilizers used in Argentina. During the 5-year period from 2016 to 2020, approximately 67% of the fertilizers used in Argentina were imported. Supply disruptions and soaring maritime freight rates have led to approximately 70% increase in urea prices.

Egypt and Algeria are the main suppliers of urea for Argentina. Approximately 71% of Argentina's imported urea comes from Egypt with 9.2% from Algeria and 7.5% from Oman.

Additionally, low water levels on the Parana River has driven up the price of imported urea even more. Instead of going directly to ports Up River, much of the imports are off loaded at southern ports in the province of Buenos Aires, which requires additional transportation costs.

How all this plays into the 2021/22 corn production in Argentina is yet to be seen, but these high fertilizer prices could result in lower fertilizer applications and potentially lower corn yields.