The Buenos Aires Grain Exchange warned it may have to cut its production forecasts for soybeans and corn for the 2022-23 growing season by up to 25% due to a prolonged drought. The worst-case scenario for production would be 35.5 MMT for soybeans and 37.8 MMT for corn if drought persists.
But the extended forecast calls for the drought to break in coming months, though it could be March before rain and soil moisture levels fully return to normal, the exchange said. La Nina is expected to fade and El Nino could evolve by late March. Unlike La Nina, an El Nino pattern could cause higher-than-usual rainfall in Argentina’s agricultural provinces.
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“Precipitation will pick up, improving soil moisture reserves and moderating the intensity of heat waves, but the process will be slow,” the exchange said in its monthly climate report. “Only towards the end of March will the soils replenish their moisture reserves in most of the agricultural area.”
