Argentine Crop Woes May Cause Market Volatility

Just where is South American production when it comes to soybeans and second crop corn?

New data released last week by Argentina’s Rosario Exchange now pegs that country’s soybean production figure at 46.5 million tonnes, well below previous estimates from USDA and private firms.

The new corn number for Argentina was lagging as well at 35 million tonnes, compared to Rosario Exchange’s previous guess of 40 million tonnes.

“We just don’t have the appreciation for the losses in the Argentine corn crop that we do in the Argentine soybean crop,” said Mike Zuzolo with Global Commodity Analytics. “Plus, we still have parts northern Brazil, which is red hot on the front burner as far as being able to make that country’s corn crop, only 16 percent planted when they should be about halfway done by now.”

That second crop corn that should be in the ground by now is about 70 percent of Brazil’s total production between both first and second crop corn.

“I think there is still a lot of volatility to be had in these markets and that potentially means better upside prices to be had as well,” Zuzolo said. “The question then becomes, does the producer have the discipline to take it. My opinion is to take those profitable prices and get them locked in before to get into the fields this year.”

Source: Morning Ag Clips

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