Argentina corn area seen shrinking

The Buenos Aires Grain Exchange said on Tuesday that 2005/06 corn area is likely to shrink compared with last season due to the greater profitability of soyabeans.
Farmers will begin seeding corn shortly in Argentina and the grain exchange puts area at 2.3 million hectares, some 300,000 hectares fewer than last year.
Another factor that could reduce corn plantings is a lack of soil moisture in parts of the growing region.
Last month farmers finished harvesting the 2004/05 crop, which the exchange forecasts at 19.7 million tonnes. The Agriculture Secretariat and US Department of Agriculture estimate 2004/05 corn output at a record 19.5 million tonnes.
The USDA puts Argentina's 2005/06 corn crop at 18.5 million tonnes. The local government has not yet released an output or area forecast.
Farmers also finished harvesting the 2004/05 soyabean crop last month, which the exchange puts at 38.8 million tonnes.
The Agriculture Secretariat sees 04/05 soya production at a record 38.3 million tonnes, while the USDA forecasts output of 39 million tonnes.
By Saturday, farmers had seeded 96.3 percent of the 5.1 million hectares they are forecast to plant with 2005/06 wheat, rising 2.6 percentage points during the week thanks mainly to plantings in south-east, southern and central Buenos Aires province, the top grower.
Dry soils in south-western Buenos Aires impeded plantings, however.
"Conditions are now unfavourable for plantings, so it is unlikely that farmers will finish seeding this already-reduced area. As a result, it's possible that wheat area could shrink a little further," the grain exchange said.
Last week, the USDA cut its forecast for Argentina's 2005/06 wheat output to 13.5 million tonnes from 15.0 million tonnes in July.
The local Agriculture Secretariat has yet to make an output forecast but puts wheat area at 5.63 million hectares. The government is due to release its monthly crop report on Wednesday.
Argentine farmers have planted 14.1 percent of the 2.32 million hectares they are forecast to seed with 2005/06 sunflower seeds, rising just 3.1 percentage points in the last week due to dry weather conditions.
Seedings "will be very much determined by rains falling in the short term. If that doesn't happen, sunseed area forecasts will have to be cut," the report said.
In the 2004/05 season, farmers seeded 1.9 million hectares with sunseeds. The exchange forecasts output of 3.525 million tonnes, while the Agriculture Secretariat puts 04/05 production at 3.65 million tonnes.