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January 19, 2012

Improved Moisture Will Aid Corn and Soy Planting in Argentina

The farmers in Argentina received some of the best rains in several months as a cold front moved across the country last week. The rains appeared to be widespread although amounts varied from less than one inch to up to three or four inches. These rains will help the soybeans much more than the corn, which has suffered irreversible damage. Those soybeans that received the heaviest amounts of rain will be OK for a week or two even without additional follow up rains. For those crops that received the lessor amounts, additional follow up rains will be needed within a week to avoid further deterioration.

Unfortunately for most of the corn in Argentina, the rainfall came too late to allow the crop to recover. The worst corn appears to be in the western and southwestern regions and the best corn is in more of the eastern regions. The nationwide corn yields in Argentina are yet to be fully determined, but severe damage has already occurred.

One of the big questions now in Argentina is whether or not farmers will plant their remaining corn acreage. Approximately 560,000 hectares of corn in Argentina remain to be planted. Three quarters of the unplanted acres are in the north-central and far northern regions of the country with the remaining one-quarter of the acres scattered through the country. Corn in northern Argentina could be planted until the end of January in the case of an emergency such as this growing season, but for most of the country, mid-January is about the latest the corn can be planted.

In addition to the unplanted corn acreage in Argentina, there will certainly be more abandonment of corn this year than normal. There are already reports of corn being used for animal feed instead of grain production. When you combine the amount of corn not planted and the amount abandoned, I think there could be a 300,000 hectare reduction in the Argentine corn harvested acreage compared to original expectations. I had originally estimated the corn acreage of 3.8 million hectares and if 300,000 are unplanted or abandoned, that would represent a reduction of 7.8%. In a situation such as this when the problem is ongoing, there will continue to uncertainty about the acreage until later in the growing season.

If we lower the corn harvested acreage to 3.5 million hectares and estimate the production at 21.0 million tons, then the nationwide corn yield will be 6,000 kg/ha or approximately 92.5 bu/ac. Even at this lower level, the total Argentine corn estimate is still not resolved. If the weather in Argentina continues to be adverse especially for the planting, germination, stand establishment, vegetative development, and eventually pollination and grain filling of the remaining unplanted corn, the estimate could eventually end up several million tons lower than where we are now just to problems associated with this late planted corn.

Last week's rain will help the development of the soybean crop especially in areas where they received some of the larger amounts. How much the crop will recuperate is in direct proportion to the amount of rainfall received last week.

Approximately 2.5 million hectares of soybeans remain to be planted in Argentina. About three quarters of the unplanted soybeans are located in the northern production areas and one quarter is spread throughout the remainder of the country. In the areas where the heaviest rains fell, certainly they will now go ahead and plant the reaming soybeans. In areas where the rainfall was the lightest, I think the majority of the soybeans will be planted, but maybe not quite all.

The next rain event in Argentina will be important for those areas that did not receive good amounts of rain last week. In some of the dryer areas, they are still probably going to need another rain to insure germination. There is still time to plant soybeans in Argentina because soybeans can be planted until the end of January in most of Argentina and into early February in the far northern provinces.

While the soybean planted acreage is yet to be resolved, I think it is safe to say that there will be more soybeans abandoned this year than in a normal year. So, even if farmers switch some of their remaining corn acres to additional soybeans, that may be counteracted by higher abandonment and some double crop soybeans not getting planted.

The condition of the soybeans in Argentina ranges from good to very poor depending on the rainfall thus far during the growing season and the stage of development of the crop. The earlier planted soybeans suffered the most because they were flowering during the heat and dry weather. The later planted soybeans probably have the best chance of recuperating if good rains continue to fall over the next two months. The soybeans that are now being planted in Argentina are going to have a difficult time achieving normal yields due to how late they are being planted and the need for good weather during their entire growing cycle, something that has not yet occurred this growing season.