The distributors of agricultural inputs from Buenos Aires anticipated a good campaign of fine grains 2021/22, in line with official estimates, which project a sowing of wheat of 7 million hectares and a harvest of 20 million tons. These numbers are similar to the planting intention of the last cycle, that were pulverized due to climatic factors and a production volume that stood at 17 million tons, far from initial expectations.
One thing to keep in mind is that the input-output relationship is favorable, even despite the increase in some inputs, such as the case of fertilizers. This situation was offset by the rise in the international price of wheat, which in Chicago is trading at $ 233 a ton, about $ 37 more compared to April of last year.
Lionel Camps, General manager of the Business Chamber of Distributors of Agrochemicals, Seeds and Related Bonaerense (Cedasaba), estimated that although some plans for wheat and barley remain to be defined, “the last rains in the province will be an incentive for them to decide to incorporate more hectares of fine grains.”
In dialogue with BAE Business, the manager estimated that the management strategy of the producers will aim to increase yields -with international prices that are very attractive- but without neglecting quality, through the management of agronomic variables such as fertilization. On average, the cereal had yields of 4,700 kilos per hectare in the southeast of Buenos Aires during the last harvest, but in specific batches – and according to the material planted – they can exceed 7,000 kilos.
Although the purchase of seeds is carried out at a lower rate compared to last year, a good performance is perceived in the commercialization of fertilizers, mostly phosphorous. Camps He remarked that the farmer invests in technology, because he knows that the business involves maximizing yields. He also highlighted a trend that can be seen in this new commercial pre-campaign, which is greater use of seed cures. “It was not so common, but now the producer seeks to ensure the implantation of the crop,” he remarked.
In a webinar that the Undersecretariat of Agricultural Markets organized at the end of March, officials and analysts put numbers to the next cereal campaign. In this sense, two scenarios were presented in relation to the planted area, with a floor of 6.5 million hectares and a ceiling of 7 million. With an average yield of 3,100 kilos –and if there were no climatic incidents-, it would reach 20 million tons, which at current prices would generate foreign exchange for $ 4.66 billion. In tax revenues, and with 12% of export duties, they represent $ 550 million that enter the fiscal coffers.
If these harvest projections are met, a smooth supply would also be ensured for the domestic market and the generation of exportable balances above 10 million tons for the 2020/21 season.
A fact that encourages the sowing of cereal is that its international price is still far from its historical highs. This variable, added to a sustained international demand, is a factor that may translate into future increases in international prices.
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