Argentina: Barley crop forecast unchanged at 4.25 mln tonnes

Over the past month moisture conditions have improved dramatically in Argentina but the rain has cleared the past two weeks. This situation has allowed barley seeding to proceed rapidly, RMI Analytics said in their late June report.

The current barley planting progress is estimated at 50-60% complete and although slightly behind normal timing, it is catching up. There remains strong competition from wheat, and as a result, RMI Analytics barley crop forecast for Argentina is unchanged at 4.25 mln tonnes.

Based on the improved conditions, it is almost a certainty that a rebound from the drought impact in 2022 will be achieved. However, exports are expected to drop as well, which leads to an increase in ending stocks.

Crop 2023 farmer selling is dramatically lower (around 12%) than at this time last year when 25-30% of crop 2022 had already been sold by farmers. Note, the FAS price was USD360/tonne last year and today it is USD240/tonne, for malting barley.

Liquidity will remain an issue at least until seeding is complete at this end of June or early July and likely only after good plant emergence is achieved.

Argentina barley prices are higher in a quiet market, although enquiries from end users (e.g. China) consistently appear. With French prices moving sharply higher, Argentina and Australia are highly competitive on the world stage at current barley prices.

Domestic prices to farmers (FAS) have moved higher in an attempt to trigger selling with barley slightly more competitive than wheat (barley at USD240/tonne versus wheat at USD230-235). The rally in US wheat figures is being watched closely as it improves wheat’s profitability for farmers, and is a risk to malting barley contracting.

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