Global Hot Spots: Argentina peso devaluation may unleash crop exports

Global Hot Spots: Argentina peso devaluation may unleash crop exports

Brazil's No. 4 soybean state cuts crop forecast about 6%; South Africa corn prices surge as drought hits crops

Argentina peso devaluation may unleash crop exports – Reuters

The devaluation this week of the Argentina peso may unleash millions of tons of the country's grain onto world markets, according to a Reuters report.

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Argentina's new president Mauricio Macri removed the currency controls that had been in place under the previous administration. The action sent the peso tumbling against foreign currencies, a move that will make Argentina's crops less expensive to foreign buyers.

South Africa corn prices surge as drought hits crops; Canada canola processing down for week, up for year

"For the first time since 2011 Argentines have full access to U.S. dollars after the new government allowed the exchange rate to float. The policy shift prompted a more than 26.5% devaluation of the peso that will make exporting more profitable for farmers, who get paid in the newly muscular dollar," wrote Reuters reporter Hugh Bronstein.

The report said Argentina farmers held about 13 million metric tons of soybeans waiting for the devaluation. A farm economist there said those could be sold between now and next May.

Brazil's No. 4 soybean state cuts crop forecast about 6% - Reuters

The farm federation of Brazil's No. 4 soybean producing state Goias on Friday cut its forecast 5.7 percent for the 2015/16 harvest to 9.8 million metric tons due to irregular rains in several regions of the center-west state, Reuters reported.

Due to forecasts for continued dry weather in the coming weeks, the federation said it could not rule out further cuts to its soybean forecast.

"Brazil's Center-west grain belt, which produces more than half of the country's massive output of soybeans and corn, is seeing irregular showers, rather than generalized or widespread rains," the story said.

USDA's latest world supply and demand report forecast all of Brazil will harvest 100 million metric tons of soybeans in 2016, up from 96.2 million in 2015.

South Africa corn prices surge as drought hits crops - Bloomberg

Prices for white and yellow corn sped to higher in South Africa, the continent's biggest producer of the grains, as drought has hurt the crops, according to a Bloomberg report.

White corn for delivery in March climbed 2.9% to 4,200 rand ($278) a metric ton this week on the South African Futures Exchange. That is the highest for a most-active contract since at least August 1996. Yellow corn gained 2.4% to 3,490 rand a ton ($231), or $5.89 a bushel.

"Weather has been and is likely to remain a key underlying factor in the domestic maize industry until February or March 2016," Wandile Sihlobo, an economist at farmers' lobby group Grain SA, said in the report. "Large parts of South African maize-producing regions remain dry and some areas, particularly the western areas, have not progressed much with planting."

The dry conditions are being blamed on El Nino.

Canada canola processing down for week, up for year

Canadian canola crushers processed 172,124 metric tons of canola during the week ended Dec. 16, a 2.8% drop from the previous week, while soybean crushers processed 38,724 tons, a weekly increase of 19.2%, said the Canadian Oilseed Processors Association.

Year-to-date processing includes about 3 million tons of canola and 778,076 of soybeans. The year ago numbers are 2,684,322 of canola and 622,843 of soybeans.

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TAGS: USDA Soybean
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