After the historic drought that has greatly impacted agricultural production, the first estimates for the 2023-24 campaign are encouraging. The Buenos Aires Wheat Exchange has released projections for this year’s wheat and barley campaign: boom of 42% of production and 49% of exports.
Cecilia Conde, Head of Estimates at the Buenos Aires Wheat Exchange, was tasked with providing forecasted numbers for wheat at the Agrotrends conference. The estimated acreage is 6.3 million hectares, 3% more than in the previous cycle, and a harvest of 18 million tons, 45% more than the poor previous drought-affected campaign.
“There is uncertainty which affects the estimation of production and planting. Soil water heterogeneity, spring forecast, financial situation and good input-output ratio,” he said before releasing the numbers.
The reasons for this boom in grain planting are mainly because gross margins are positive. The price of cereals is 18% above the average of the last 5 years (but 19% lower than last year, which skyrocketed due to the Russia-Ukraine conflict) and the input-output ratio has improved thanks to the drop in values of nitrogenous and phosphoric fertilizers. “Inputs have fallen more than the price of grainthey said.
For barley, the specialist has predicted that the area will remain at 1.3 million hectares and has estimated that production will increase by 32% (5 million tonnes).
Thus, between the two cereals, the total production would be 23 million tons.
Ramiro Costa, an economist at the Buenos Aires Wheat Exchange, added the impact this increased production of wheat and barley could have: He expects it will be exported from US$ 4.5 billion, 49% more than in the 2022/23 cycle.
Also State tax collection will grow: US$1,593 million, up 27%.
In parallel, Costa established a ten-year scenario of what could happen to grain production. With restrictive policies and high withholding taxes, as occurred in 2015, the future scenario would be one of decline.
But, in another, more positive scenario of cereal policies, only with a gradual decrease in withholding taxes, it would reach 28 million tons. And if export promotion policies were added to this, 35 million tons would arrive.
Source: Clarin
