As a consequence of a historic Argentine drought, it could lose its position as the world’s leading soy meal exporter
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On Tuesday, the Rosario stock exchange (BCR) said that Argentina is set to lose its status as the world’s top exporter of processed soy meal due to the toll of a historic drought on the country’s main cash crop.
In a report, the Rosario stock exchange (BCR) predicted that Argentina’s soy meal shipments will likely be overtaken by neighbour Brazil for the first time in a quarter century during the current harvest. The 2022/2023 national soy meal output is expected to plummet 36% from the previous season to just 27 million tonnes.
BCR estimates that some 20 million tonnes of soy meal will likely be exported, representing around 29% of the global supply. The exchange forecast is that Brazilian soy meal shipments will probably reach 21-23 million tonnes.
However, data from Brazil’s industrial vegetable oil association Abiove puts this year’s expected soy meal sales slightly lower at 20.7 million tonnes.
Argentina’s reduced soy meal yield will leave the country, for decades, a global farming powerhouse, with its lowest production level since the late 1990s.
Protein-rich soy meal is mainly used to make livestock feed, but it is also a key ingredient in various foods and beverages like tofu and soy milk.
Also, a major corn and wheat supplier, Argentina has dominated the soy meal market in recent decades thanks to a massive local soybean crushing industry near significant farmland and the mighty Parana River, South America’s second longest waterway, which provides easy access for ships.
Severe drought conditions from May through early March significantly shrunk the soy crop.
Crushing chamber CIARA-CEC has said local soy processing plants have been operating at record low capacity levels due to the drought.
According to government data, during the previous 2021/2022 cycle, declared soy meal shipments reached 23.5 million tonnes, down 13% compared to the year-ago period.
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