It might be deja vu all over again for Argentina producers.
After a reasonably good start to the 2024-25 growing season, dryness is once again rearing its ugly head in January – just as it has in previous years, most notably in 2022-23. As can be seen on the map below, the primary corn and soybean production provinces, including Buenos Aires, have seen below normal precipitation over the past 30 days.
Just this week, the Buenos Aires Grain Exchange pegged the Argentina soybean crop at 49.6 million tons, down 1 million from its previous estimate and further below the official USDA forecast of 52 million. The exchange also lowered its corn estimate by 1 million tonnes to 49 million, versus the USDA projection of 51 million.
During a presentation at the Ontario Agricultural Conference earlier this month, Ag Resource Co., chief grains analyst Ben Buckner said there are few certainties when it comes to the markets and weather, but one of them seems to be the impact La Nina events have on Argentina production. Although expected to be relatively weak and short-lived, the current La Nina formed in the latter half of December and could be poised to take the top off Argentine corn and soy crops, nonetheless.
“If La Nina is present in any form in the month of December, you are just about guaranteed drought in Argentina and yield loss in Argentina,” he said. “Most likely, we’re going to lose yield this year.”
The question at this point is how much yield. Certainly, the main problem in Argentina lately has not been the complete absence of rain, but rather just spotty showers and inadequate amounts. Forecasts indicate the more northern production areas will see regular rain and thunderstorms through into the middle of next week, after which a drier weather settles in. Longer-term outlooks call for rain in the Feb. 3-6 period, but confidence is low.
Historic drought in the 2022-23 growing season slashed Argentina corn and soybean production to just 37 million and 25 million tonnes, respectively. Output rebounded the following year to 50 million and 48.2 million tonnes.
