After drought, Argentine grains exchange sees further risk to soy harvest

Credit: REUTERS/Agustin Marcarian

Feb 2 (Reuters) - Argentina's Buenos Aires grains exchange warned on Thursday that despite a recent rainfall, a historic drought over the country's core agricultural region could still negatively impact the current soybean harvest.

Just under half of an estimated 16.2 million hectares of soy land was in "good or adequate" condition as sowing ended, the exchange said in a weekly report, a 17 percentage point improvement over the last fortnight after long-awaited rains.

However, hot weather and lack of humidity over December and the first half of January, as early crops entered a critical phase, "reduce our yield expectations which will affect our 41 million tonnes production forecast," it said.

Argentina is the world's largest exporter of soybean oil and meal and the third-largest exporter of corn, but the effects of a drought that began in May have slowed planting and nearly halved its wheat output.

Corn planting, which has advanced to 96.5% of an estimated 7.1 million hectares for the 2022/23 cycle, is meanwhile expected to produce some 44.5 million tonnes, well below the 52 million tonnes produced in the previous harvest.

The grains exchange cited lack of water, with the heaviest losses recorded across the provinces of Santa Fe, Entre Rios and Buenos Aires. (Reporting by Sarah Morland; Editing by Chizu Nomiyama) ((;)) Keywords: GRAINS ARGENTINA/SOYBEANS

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