Argentina to cut wheat, barley export duties from June, soybeans from Jan. 2027

Wheat and barley export duty reductions in Argentina will help provide some relief to producers' expected margins as they make their final decisions for the 2026-27 season, the Rosario Board of Trade reported May 22.

Starting in June, Argentina's export duties for wheat and barley will be reduced to 5.5% from the current 7.5%.

From January 2027 onwards, soybeans will also see a further monthly reductions of 0.25%-0.5% on their duties, President Javier Milei announced during a conference at the Buenos Aires Grain Exchange on May 21.

In an international scenario marked by a sharp increase in the cost of inputs for grain sowing derived from the Middle East war, the urea/wheat price ratio has reached a historic high of 4.1 from 2.6 in the previous year, according to the Board of Trade data.

During the first quarter, urea prices rose sharply worldwide. After peaking in April in producers' markets, prices have declined in recent weeks, with a clear softening in Latin American markets.

Argentina's urea imports rose 70.43% year over year to 93,386 metric tons in the first quarter, according to data compiled in the S&P Global Trade Analytics Suite.

"As a reference, at current prices, fertilizers and freight (impacted by the rise in diesel prices) together account for 54% of wheat production costs," according to the Board of Trade.

Focusing on wheat, if the measure is implemented, it would directly improve the purchasing power for both nearby deliveries and the new crop. According to the Board of Trade, the wheat FAS price would improve by $4.80-$4.90/mt under the new export duty scheme.

As for phosphates, another key fertilizer for Argentine agriculture, a local analyst expects monoammonium phosphate demand to be driven by ongoing wheat sowing amid reported favorable soil conditions for the wheat crop, despite "50% of Argentine farmers" expected to reduce their use of technology, reflecting lower phosphate needs year over year.

"A 3% drop in area is being measured against the last record crop campaign," the analyst said. "MAP affordability has improved over the current wheat prices."

Platts, part of S&P Global Energy, assessed weekly granular urea prices in Brazil at $619/mt CFR, and weekly monoammonium phosphate prices in Brazil at $900/mt CFR as of May 21.