Argentine corn sowing booms on optimism over new government

(Photo courtesy Canada Beef Inc.)

Buenos Aires | Reuters — A late-season corn planting flurry in No. 4 world exporter Argentina could push output to the same level as the previous crop year, thanks to the policies of the new government, the director of the local maize industry chamber said Friday.

Growers across the Pampas farm belt applauded the November election of Mauricio Macri, a free-markets advocate who during his first month in office has reversed many of the market controls imposed by previous President Cristina Fernandez.

Inaugurated on Dec. 10, Macri has abolished wheat and corn export taxes along with the quota system that Fernandez used to curb international shipments of both crops. He has also relaxed currency controls, prompting a 30 per cent currency devaluation that has made Argentine farmers more competitive.

The Buenos Aires Grains Exchange has forecast 2015-16 corn acreage at 2.85 million hectares, well under the 3.4 million in the 2014-15 season, which yielded a 26.3 million-tonne harvest.

But, with several weeks of corn planting to go in some parts of Argentina, Martin Fraguio, executive director of the Maizar corn industry chamber, said in an interview that farmers are closing in on the 3.4 million-hectare figure.

“It’s possible that this season could be equal to last, both in corn planting area and production,” Fraguio said.

Higher-than-expected corn exports would hit a world market already weighed down by high international stockpiles.

More than 90 per cent of corn planted in Argentina is genetically modified. GMO seed sales have jumped since the Nov. 22 election, as have related chemicals glyphosate and atrazine, sold by companies such as Monsanto.

“Planting area could have fallen 30 per cent, depending on the outcome of the presidential election. Now we’re talking about a fall of zero to 10 per cent,” Fraguio said.

Corn is still being sown in northern parts of Cordoba province, and other northern regions. Growers who are expected to harvest the remaining 20 per cent of 2015-16 wheat in southeast Buenos Aires province are weighing whether to jump in and plant corn in those fields before the sowing window closes.

“These areas could make the difference between meeting last year’s production, or having a small reduction,” Fraguio said.

Early planted 2015-16 corn is now flowering in the main Pampas corn belt, centered in the bread-basket province of Buenos Aires, under what have been ideal weather conditions.

Reporting for Reuters by Hugh Bronstein and Maximiliano Rizzi in Buenos Aires.

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