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October 1, 2019

Estimates from the B. A. Grain Exchange and its Meteorologists

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

In their annual conference held last week concerning Argentina's 2019/20 summer crop production, the Buenos Aires Grain Exchange estimated that the 2019/20 corn production would be 50 million tons, which is similar to last year. For soybeans, they estimated the 2019/20 production at 51.0 million tons, which would be down from last year when they estimated that Argentina produced 55.1 million tons.

The exchange is expecting the corn acreage to increase marginally from 6.3 million hectares to 6.4 million hectares. In August they had expected the corn acreage to increase to 6.7 million hectares. For soybeans, they are expecting the acreage to also increase marginally from 17.4 million hectares to 17.6 million hectares.

They are attributing the lower production estimate for soybeans to less ideal weather compared to last year when record soybean yields were recorded. Currently, the soil moisture in Argentina is limited and there is not much rain in the near term forecast. Farmers in Argentina should currently be planting their corn and starting on soybean planting, but planting has been slow due to the dry conditions.

Reuters recently reported that meteorologist Eduardo Sierra from the University of Buenos Aires and consultant to the Buenos Aires Grain Exchange, expressed concerns over the dry conditions in Argentina. Sierra estimated that 20% of the grain producing areas of Argentina are in mediocre to bad conditions due to dry weather. He estimates that these areas account for 30% of Argentina's wheat, 20% of its soybeans, and 25% of its corn production.

As a result, he has trimmed his soybean production estimate to 50 million tons and he has slashed his corn production estimate by 20% to 40 million tons. He also lowered his wheat production estimate by 3 million tons to 17 million.