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A leading Argentine grains exchange cut its 2024/2025 soybean crop forecast by one million tonnes on Thursday, as the impact of drought becomes more apparent.
The Buenos Aires Grain Exchange now expects production to reach 48.6 million tonnes, down from the previous forecast of 49.6 million tonnes published last week.
Argentina is the world's largest exporter of soybean oil and soybean meal.
The exchange said the lower-than-expected output was due to drought that has reduced yields in the northeast of the country.
In its weekly crop report, it said: "High temperatures and persistent water shortages have caused heat and water stress, mainly affecting Argentina's northeastern (NEA) region."
It added: "These adverse conditions have significantly affected plant density and the development of reproductive structures, reducing yield potential by 22%."
About 10% of Argentina's total soybean planted area lies in the northeast, equivalent to roughly 1.86 million hectares (4.60 million acres).
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Regarding the 2024/2025 corn crop, the exchange said the drought, which is also affecting northwestern Argentina and the north of Córdoba province, "has led to a 40% drop in expected yields compared with previous estimates."
However, due to a technical adjustment that raised the estimated corn planted area for this season by 7.6% to 7.1 million hectares, the exchange kept its total harvest forecast unchanged at 49 million tonnes.
Argentina is the world's third-largest corn exporter.
Source: Reuters