The USDA cut deeper into its forecasts for Argentina corn and soybean production, bringing the agency’s estimates closer to those of Gro’s forecast models.
In its February WASDE report, the USDA trimmed an additional 10% from both Argentina corn and soybeans to 47 million tonnes and 41 million tonnes, respectively, for 2022/23, which refers to the local 2023/24 marketing year in Argentina. Since December, the USDA has cut the country’s production outlook by 15% for corn and by 17% for soybeans. Argentina is the world's largest soybean meal exporter and second-largest corn exporting country.
Gro’s Argentina corn and soybean yield forecast models, which update daily, have pointed to significant declines since the season got underway in mid-December. Severe drought at the start of Argentina’s growing season cut planting prospects and poor rainfall levels through mid-January have severely limited yield prospects.
Late January rainfall has brought improved vegetative health levels for Argentina’s crops, but gains are not yet strong enough to boost the yield outlook significantly. To monitor the Gro vegetative health index and Argentina’s crop prospects in the coming weeks, view displays in Gro’s Climate Risk Navigator for Agriculture, weighted for Argentina’s corn and soybean cropland areas.
The USDA also reduced Argentina soybean and corn export estimates but offset this with higher exports from other South American countries, mainly Brazil, where crop outlooks remain bright. The USDA didn’t adjust Brazil soybean or corn production figures this month.
Yield prospects for Brazil’s soybeans and corn remain strong, according to Gro’s yield forecast models. Growing conditions are favorable across most of the country, though some regions, including in the state of Rio Grande do Sul, have seen stress due to dry conditions. Gro’s Brazil Yield Forecast Models for soybeans and corn estimate yield at the district level and update daily.
The USDA slightly trimmed 2022/23 US corn and soybean ending stocks due to reduced estimates in corn demand for ethanol and lower forecast soybean crush. However, the agency made no changes to US corn and soybean export estimates for 2022/23. That comes despite very strong US soybean exports so far this marketing year. While Brazil’s soybean harvest has been slowed by recent rains, the country’s flow of soybeans should pick up in the coming weeks. You can monitor Gro’s US Soybean Export Forecast Model for updates.
Meanwhile, US corn export sales and shipments remain sluggish this marketing year, and we should expect cuts to the USDA’s full year export forecast in the coming months, particularly if Brazil shipments indeed do offset reduced exports from Argentina. Gro’s US Corn Demand Monitor allows users to track the pace of the major drivers of corn demand, including ethanol, animal feed, and exports.
Globally, the USDA modestly cut estimates for global corn and soybean ending stocks, as lower corn and soybean production were mostly offset by reduced consumption forecasts. The agency increased its Ukraine corn export outlook by nearly 10% to 22.5 million tonnes. Since July the USDA has more than doubled its Ukraine corn export forecast, but even so its latest estimate still lags the 2021/22 season by 17%. Wheat supply estimates moved higher with small increases in Australia and Russia wheat production.