According to the Buenos Aires Grains Exchange, Argentina will plant 22% less wheat this season than it did in the previous crop year. The US Department of Agriculture forecasts Argentine wheat production at 12 million tonnes in 2012/13. This is down from 14.5 million tonnes in the previous crop year- an overall reduction of 2.5 million tonnes.
Wheat growers in the country are expected to plant around 3.6 million hectares with wheat for the 2012/13 harvest- 100,000 hectares less than the Grains Exchange’s previous estimate.
Currently ranked the world’s sixth largest wheat exporter and the top exporter to Brazil, the tides are changing in Argentina’s agricultural climate due to state policies favouring other crops.
Many farmers are shifting toward growing barley and soy to avoid government-imposed wheat export limits.
Wheat futures jumped to the highest in almost four years as the worst drought since 1956 is eroding crop prospects in the US (usually the world’s top wheat producer) and dry weather hurts production in Australia and Russia.
Australia will face dry conditions for the next three months according to its Bureau of Meteorology. Russian farmers will collect 46.5 million tonnes of the grain in the season that began on 1st July, down 4.1% from 2011, researcher SovEcon said.
The United Nations expects global food demand to double by 2050 as the world population hits 9 billion. Argentina’s Pampas, an area greater than France, will be key to feeding an increasingly hungry world. However, these shifts paint a foreboding picture in meeting these demands.
Argentina is also the world’s third soybean exporter and second supplier of corn after the United States. Crops which many former wheat farmers are turning to in the face of restrictions and more lucrative prices.