USDA Forecast 10 percent Rise In Argentina Corn Crop For MY 2018/19

As per the latest release from United States Department of Agriculture (USDA), Argentine corn production for MY 2018/19 at 40.0 million tons, the second highest volume in history and 9 million tons higher than the drought-impacted MY 2017/18 crop. Harvested area is projected to increase 100,000 hectares to a record 5.2 million hectares. Strong domestic futures corn prices (April 2019 at $ 174 per ton) position corn, with stable production costs, as a strong option in MY 2018/19 to provide higher income and positive returns. Furthermore, farmers will continue to incorporate corn in their crop rotations to improve soils and combat problematic herbicides-resistant weeds. Higher growth potential, though, is tempered by drought impacts on farmer solvency that may see strapped farmers planting soybeans due to their lower financial investment, per hectare, than corn. The planting of late corn or second corn crop (over a winter crop such as wheat, barley, canola or peas) which is normally planted in the first two weeks of December, is expected to drop vis-n++-vis early corn in MY 2018/19. Over the past several seasons, the preference for late corn has grown due to stable yields as it skipped flowering in the normally dry and hot window of late December-early January. In MY 2017/18, late corn accounted for about 60 percent of the countrys corn planted area. To date, late corn is showing a very poor condition after the extended drought that affected a vast area between December-March. Most corn planted early (September) yielded better as soils had higher moisture. Contacts anticipate that the share of late planted corn in MY 2018/19 could drop to 40-45 percent.

Corn production in MY 2017/18 is estimated at 32.0 million tons, 1.0 million tons below USDAs. Late-planted corn had low moisture levels during the season and for harvest in May is not in good condition. Most local analysts and traders estimate that corn production for MY 2017/18 will be between 30.5-32.0 million tons.