Agri-commodity market focus: Attention shifts to Argentina and new president's reform initiatives

This decrease in soybean futures was influenced by the anticipated rainfall, particularly in central and northern Brazil, where prior dry conditions had led to downgraded forecasts for the country's soybean production in 2023-24, as highlighted in a review by CRM Agri.

Meanwhile, Argentina is making headlines due to an upgrade in its wheat crop and moves by the new president, Javier Milei. Analysts believe the devaluation of the peso​​ might incentivize farmers to sell their crops. Argentinian farmers had been delaying crop sales, as the value of their produce is tied to the dollar, anticipating a depreciation of the peso.

Milei is also reportedly contemplating an increase in Argentine taxes on certain grains, potentially reaching 15%. This could impact sowings, particularly for crops like corn, subject to a current 12% levy, although soybeans, already facing a 33% levy, would remain unaffected, according to the UK grain and oilseed market specialists. 

Boosted corn exports from Ukraine ​

In a separate report, CRM Agri drew attention to Ukraine's corn exports, reaching 2.3 million metric tons last month—a 15% increase compared to November 2022. This growth, partly at the expense of other crops (wheat volumes fell 29% YoY), was supported by efforts to enhance exports through the 'humanitarian' shipping corridor in the Black Sea and developments along the Danube.

Simultaneously, Brazil has intensified its corn export efforts, doubling its share in the world market over five years to 32%, notably due to its entry into the Chinese market. From January to October this year, China imported 5.6 million metric tons of corn from Brazil, a significant increase from zero in 2022.

In contrast, US corn exports to China halved to 6.3 million metric tons. However, the US is making strides in global trade, securing additional orders from countries like Mexico, leading the USDA to raise its US export forecast last week.