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September 27, 2017

Corn Offers Better Returns than Soybeans for Farmers in Argentina

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

Farmers in Argentina have started to plant their 2017/18 corn crop and they are expected to increase their corn acreage due to better returns expected for corn. The big advantage for corn in Argentina is the fact that the export tax for corn has been completely eliminated, while the export tax for soybeans is still 30%. The soybean export tax is scheduled to start declining by 0.5% per month starting in January of 2018.

The National Institute of Agricultural Technology in the city of Marcus Juarez (INTA) analyzed the profitability of various crop rotations in southeastern Cordoba and they concluded that the best option economically is for farmers to double crop soybeans following wheat.

INTA calculates that gross receipts for a single crop of corn are 12% better than for a single crop of soybeans, if both are planted in the spring. But, the gross receipts for the combination of wheat followed by a second crop of soybeans are 5.4% higher than for just a single crop of soybeans. Double cropping soybeans after wheat is 20% more profitable than just planting a single crop of soybeans.

The summer growing season in Argentina has two phases. The first phase is the spring planting of a full-season corn crop or a full-season soybean crop which occurs during September and October. The second phase of the summer growing season is the planting of double crop soybeans after the harvest of wheat or barley or the late planting of a corn crop. Both of these occur during December and early January. The trend in recent years has been for farmers in Argentina to plant more of their corn during the second phase of planting.