Argentina’s Grain Shipments Reach Record Level Yet Wildfires and Conflict Darken 2022 Forecasts
https://www.bcr.com.ar/es/mercados/inve ... en-el-2021 (hit “English” for translation)
Extract:
(Rosario Board of Trade) Grain shipments from Argentine ports totaled 60.66 Mt, a historical record. The participation of the ports of Greater Rosario fell, also influenced by the lower production of the central and northern regions of the country.
After a 2020 marked by the impact of the COVID-19 pandemic on consumption and the key variables of the national and global economy, 2021 brought a strong recovery in world economic activity and the normalization of the flow of international trade, which decanted in a strong increase in the demand for food that impacted both the prices and the volumes of grains sold.
In this context, and despite the difficulties imposed by the level of the Paraná River and the productive setback suffered by some of the main crops during the last campaign, the country shipped, from all its port terminals, grains for 60.66 Mt in the 2021, 7% more than everything shipped in 2020 and reaching a historical record by surpassing the 2019 mark (at that time 60.3 Mt were shipped).
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Finally, regarding grain destinations, Asia once again became the main destination for Argentine grain shipments, receiving 52% of the total, equivalent to 31.8 Mt (↑ 6% vs. 2020). In second place was America, which represented 26% of total shipments (16.1 Mt, ↑18% vs. 2020). Africa ranked third with shipments of 12.2 Mt (↑ 2% yoy) and Europe came fourth and last with 616,419 t (↓28% yoy).
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In the case of wheat, Brazil undisputedly positioned itself as the main (single country) recipient of shipments of Argentine winter grain. In the last year, it received 5.2 Mt, 16% more than in 2020. In addition, Chile also stands out, receiving almost 840,000 t, more than double the 2016 record. On the other hand, and as expected, shipments destined for Indonesia fell sharply. This is because, in previous years, the island country had to go in search of new supplies when Australia (its usual supplier) had severe production problems due to a severe drought, which was beneficial for Argentine wheat. However, in the last year the Australian production recovered, so it was once again the supplier of its usual customers, to the detriment of domestic wheat.
https://www.courthousenews.com/argentin ... forecasts/
(Courthouse News) Although the volume of grain shipments is at record highs, the number of farmers growing crops is concentrating in fewer hands of Argentina’s rural landed class. And despite positive export figures for 2021, Argentina faces an uncertain and volatile harvest for the 2021/2022 season, with soaring summer temperatures triggering droughts and forest fires in the northern provinces.
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Running alongside the eastern border of Corrientes is the Paraná River, the second-longest in South America and a vital waterway for transporting grains from the farm belt for export. Yet drought has led to its lowest levels since 1944 (its flow rate dropped from an average of 17,000 cubic meters to 6,200) and limited the volume of grains for transport.
The drought, which has also affected areas of Brazil, has pushed the price of soybeans upward, rising by $4.80 to $593.20 per ton, as producers scale back their production estimates for 2022. Together, Argentina and Brazil grow half of the world’s soybeans. Soy production is expected to reach its lowest levels in 14 years during this year’s harvest, 30% less than expected.
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Rising grain prices are not only consequences of worsening climate conditions but also military conditions, with Russia’s invasion of Ukraine provoking volatility in the price of wheat and corn – with wheat rising by $5.10 to $298 per ton and corn rising by $4.50 to $262.10 per ton.
Russia and Ukraine are major grain exporters, accounting for 19% of global corn exports, 29% of wheat exports and 80% of sunflower oil exports.
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