Inside: Grains & Raw Material
Drought in Argentina drives up soy prices
The price for soybeans on the CBoT in Chicago is suddenly on the rise this week. The price increase is a response to the ongoing drought in Argentina.
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Choose the subscription that suits youThe soybean harvest of the 2017/2018 season is expected to be much lower due to the drought in the important Argentine agricultural province of Buenos Aires. Estimates speak of a harvest of 54,5 million tons. Approximately 82% of the soybeans had already been sown at the end of the past year.
Whether the remainder of the planned area will still be sown depends on the condition of the soil. Typically, sowing can take place until early January in Argentina. The price of soybeans on the CBoT increased by $2 to $2,94 per ton during the first 352,65 trading days of the new year (closing price on Wednesday, January 3).
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Due to the drought in Argentina, the soy price (CBoT) is on the rise again.
Persistent drought
In 2017, Argentina was also plagued by persistent droughts and floods. The drought in some Argentine growing areas has been going on for some time, but there has been no rain in recent weeks. Nevertheless, Argentinian soy production is not expected to end in a fiasco in 2018. Other parts of Argentina are less affected by the drought.
Important player
Argentina is the third largest producer of soy and is also an important exporter. A large part of Argentina's exports goes to European countries. More than a quarter of Dutch soybean imports come from Argentina.