This is a loss of more than two points of GDP, as a result of the low harvest of soybeans, corn and wheat, during the next season
For iProfessional
01/18/2023 – 07:56 a.m.
The lack of rain that affects a large part of the country has a direct impact on the productive areas and the low harvest will affect the income of dollars this year.
It is that the export of wheat, soybeans and corn, is the main provider of income in US currency for our country, so the current bad campaign, It will cost about $8 billion.according to a report from the Rosario Stock Exchange (BCR).
Added to this is the loss of the last harvest, at the end of 2022, which would add up to some 10,425 million dollars, which represents more than 2 points of Argentina’s GDP.
The survey carried out by the Rosario entity, one of the largest soybean regions in our nation, indicates that the great drought reduced oilseed production by 50%and left out of the productive area 40% of the central region of the country.
How much did the export of wheat, soybeans and corn fall?
If you take into account the exports estimates of the main products derived from wheat, soybeans and corn, the losses were estimated by the agricultural sector, in about 7,978 million dollars. This represents 18% of the total foreign exchange income from agriculture in the previous agricultural cycle.
For its part, the Central Bank of the Argentine Republic (BCRA) admitted that although “this figure is offset by the improvement in international prices as a result of the drop in the volume of supply due to the drought, the ‘price effect’ is insufficient to compensate for the fall in the amount to be exported”.
Poor harvest due to drought will affect the economy.
Another of the important points analyzed in the Rosario Stock Exchange report is the drop in tax collection to soybean production, which is estimated to generate a loss of resources estimated at 1,360 million dollars.
In the case of the collection for wheat, the producing provinces will stop receiving some 352 million dollars. To which are added another USD 795 million due to the drop in sowing and wheat yields.
In the case of corn, export duties will stop being collected, so they will be about 1,048 million dollars less, of which 68% correspond to the drop in the value of exports.
Other negative projections
The lower production due to the droughts, which affect more than half of the national territory, would cause agricultural production levels to fall to lower levels than those registered in the 2021/2022 period and the average of the last five campaigns. This is the warning from a report prepared by the Cereals Exchange, which reflects that the production of the main grains will suffer significant cuts -especially wheat-, from the projections made at the launch of the gross campaign, last September.
According to the entity’s analysis, climatic reasons are the main reason that will affect production and exports this year. To this are added the prices of inputs and economic policies, which “modify the decision of the producers” and “has further aggravated the situation, making the planting process difficult, the development of crops next to the area suitable for harvesting , causing drop in potential returns“, they warned in the report.
In this sense, agricultural businessmen pointed out that only in the fine harvest, the projected wheat production will reach 12.4 million tons (represents almost half of the 21.8 million of the previous campaign), when a record figure was achieved. Barley fell from 5.4 million to 3.8 million, comparing the same periods.
