INTERVIEW: Argentina 2020-21 corn output seen down 8.7%: BAGE

New Delhi — Argentina's corn production is likely total 47 million mt in 2020-21, down 8.7% year on year, Esteban J. Copati, Head of Agricultural Estimates Department of Buenos Aires Grain Exchange (BAGE) told S&P Global Platts.

The reason for the fall is the reduction in planted area to an estimated 6.3 million hectares, as compared with 6.5 million hectares in the 2019-20 season and a generalized drought affecting much of the agricultural area, Copati said in an email interview.

Copati said he saw many farmers opting for late-season corn due to the lack of sufficient water availability in the agricultural area of the country.

"We are expecting this (drought) condition to worsen during February. For that reason, farmers have shifted in favor of late-planted corn (December-January) covering almost 49.9% of the estimated planted area for the 2020-21 season in order to avoid setting the critical stages of yield determination during scares water availability and high temperatures," Copati said.

During the last corn season, the proportion of late corn was closer to 37% of the total area planted.

In Argentina, early corn is normally planted in September-October and harvested in April-May, while the second corn crop is usually planted in December-January and harvested in June-July.

The vast majority of the production area in the country, which is the third-largest exporter of corn, is experiencing varying levels of drought. Currently, the most affected regions cover the northern part of the country and especially Cordoba and Santa Fe provinces which are central to Argentina's corn cultivation, Copati said.

In north-central Cordoba only 40% of the crops have favorable or optimum moisture conditions, while in south Cordoba also it was at 40%, the BAGE said in a report on Oct.1. Cordoba accounts for 27% of the projected corn area in 2020-21.

La Nina

Adding to the prevailing drought condition in the country has been the La Nina formation in the Pacific Ocean.

Generally, Southeast Asia, South Africa, India, and Australia receive above-normal rainfall in event of a La Nina event, and drier weather is seen in Argentina, Europe, Brazil, and the southern US.

La Nina is likely to remain until at least the end of this year, Australia's Bureau of Meteorology said Sept. 29.

"Should this (dry) condition persist we can expect lower yields in both early and late-planted corn, an underdeveloped crop due to lower plant growth rate during its vegetative stages and more importantly during its critical yield determination period," Copati said.

In the past 10 years, during the key planting months of September-January for South America, La Nina was observed in 2010 and 2011.

Argentina's corn yield fell to 6.35 mt/hectares in 2010-11 from 7.80 mt/hectares 2009-2010 and it dropped further to 5.735 mt/hectares in 2011-2012.

Besides drought, crops could also be more affected by pests, especially in the northern region, he said.

"What is more, for heavily affected areas, we could also expect loss of harvestable area. Both of these could heavily reduce the estimated production for the ongoing season," Copati said.

Copati also added that a drop in corn area would not necessarily mean farmers would shift to soybeans, another major cash crop.

"Regarding the shift between crops, aside from the weather conditions, there are also technical aspects specific of each crop to consider. Such as, the pre-emergence applications of residual herbicides in corn which rule out the possibility of switching to soybean. In that case, it may very well depend on the decisions adopted by each farmer."