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Argentina Oilseeds and Products AnnualReport 2011

14 May 2011

USDA Foreign Agricultural Service

In the forecast for marketing year (MY)2011/12, it is estimated that the soybean area in Argentina is to increase by two per cent to 19 million hectares (ha), while sunflower area will remain at 1.65 million ha and peanut area is expected to drop slightly to 260,000 ha.


Oilseed, Soybean (Local)
Oil, Soybean (Local)
Meal, Soybean (Local)
Oilseed, Sunflowerseed
Oil, Sunflowerseed
Meal, Sunflowerseed
Oilseed, Peanut
Oil, Peanut
Meal, Peanut
Oilseed, Cottonseed



Post forecasts soybean area for marketing year (MY) 2011/12 to reach 19.0 million hectares (ha), an increase in area of 2 percent from the 2010/11 marketing year. This area will mostly come from area that was not planted this year because of the dry weather and from an increase in second crop soybeans planted after wheat. Soybeans continue to be the “safest” crop to produce in Argentina. Input costs are lower than other commodities and although export taxes are high, there are no export restrictions or quotas for soybeans as there are for grains. This year producers have had high prices and are expected to generate high returns for the crop. Although input costs are expected to increase next year, especially for fertilizer, producers are still expected to put more area to soy. Production is estimated at 53 million metric tons (MMT) based on historical yield trends, slightly more area to second crop soy, and the expectation of possibly having another dry year. Post contacts indicate that usually after one la Niña year with dry weather, another similar year follows.

For 2010/11, FAS Buenos Aires maintains its estimate of soybean production at 49 MMT (500,000 MT below the current USDA estimate of 49.5MMT). Rains in late January helped to recover much of the crop, especially first crop soy in the central and northern regions of the key growing area, but left second crop soy in less than desirable conditions. Another dry spell hit again in the beginning of March which did not provide further relief for the soybeans that still needed more moisture. FAS Buenos Aires staff travelled to the west and southern areas of Buenos Aires province during mid-March and the story was the opposite. There, much of the second crop soy is in better conditions than first crop soy however, it is at higher risk of damage if frosts come early. Overall, the crop is in better condition than what was expected had the dry spell continued past mid-January but it is still very sporadic with some areas in decent shape with yields of about 3.0 tons/hectare expected and others, perhaps just 50 km apart, yields below 2.0 tons/ha expected. Private analysts have brought their estimates back up to the range of 48 to 50 MMT.


Sunflower area for MY2011/12 is expected to remain at 1.65 million hectares. Although crop conditions and yields are proving to be above average this year, lingering problems of pigeons and parrots and competition with soybeans still cause hesitancy in producers’ decisions to expand sunflower area. Production is estimated at 2.8 MMT with yields more closely reflecting historical averages.

Production for the current marketing year 2010/11 is raised to 3.2 MMT, up 400,000 metric tons from the previous estimate and the official USDA number. Conditions were excellent for sunflower this year and since sunflower has a much deeper root system than corn, most of the crop was able to sustain through the dry periods with little damage. As of March 24, 2011, harvest was 82 percent complete. Pigeons and parrots were still a problem in the northern and northwestern regions of the country (Entre Ríos and San Luis provinces) but yields were still average, between 1.2 and 1.8 tons/ha. In the southern area of Buenos Aires province some producers are expecting excellent yields between 3.0 and 4.0 tons/ha.

This year to mitigate some of the bird problems, contacts indicated in some areas a sacrificial “dummy” field was planted earlier than the rest of the crop in order to lure the birds away and potentially satiate their hunger for sunflower seeds and/or recently emerged seedlings. The rest of the fields were planted a few weeks later and planting was staggered. Apparently, this helps slightly, but does not solve the problem. Traditional hunting has been explored as a solution, as well as hunting with slingshots. Nothing seems to control the birds and this continues to provide a disincentive for producers to plant sunflowers.


Post forecasts area for peanuts to drop very slightly to 260,000 hectares for the 2011/12 marketing year. Contacts indicate that land rental prices and input costs are expected to increase next year and the margins gained by peanut producers may shrink. Producers are less willing to invest aggressively by expanding area. Production is forecast around 800,000 MT.

There is no change to production and area this year.


The Ministry of Agriculture estimates cotton area for the 2010/11 marketing year at 550,000 hectares. This is approximately a 12 percent increase in area over last year (2009/10) where reports show that area harvested was 489,600 hectares with cotton production of 760,000 MT. Contacts indicate that this area could increase in the next marketing year by 15 to 20% due to continued strong prices for cotton.


Soybean and Soybean Products

For MY2011/2012, post forecasts soybean crush at 40.5 million tons, up 1.625 million tons from the current marketing year due to larger expected supply. Demand for domestic soybean oil will go up by 300,000 tons to 2.2 MMT in order to meet the biodiesel industry needs. Likewise, as crush increases, meal production is expected to grow, although the majority will be exported. It is estimated that only about 2 percent of the meal production will be use for domestic consumption in the poultry industry.

There are no changes to crush numbers for the current marketing year, 2010/11. Additionally, crush for 2009/10 is maintained at the current official estimate of 38.623 MMT. Official figures from the Ministry of Agriculture show a total of 34.4 MMT through January 2011. Industry sales, which usually run lower than final data, show an additional 1.7 MMT from January through February. Adjusting this number upward and adding estimated crush for March based on historic data, pace is on target.

Sunflowerseed and Products

Post forecasts sunflowerseed crush for MY2011/12 at 2.9 MMT based on higher production this crop year and larger carryover stocks at the beginning of next year. Oil production is projected at 1.195 MMT and meal at 1.275 MMT. Domestic consumption for oil and meal are steady at 375,000 MT and 620,000 MT, respectively. Most oil is used for food use and meal is used for animal feed in the dairy sector.

Due to higher yields and larger production this year, crush for MY2011/12 is raised to 3.15 MMT, up 300,000 tons. Oil production is raised by 120,000 tons to 1.3 MMT and meal is raised 125,000 tons to 1.375 MMT. Contacts indicate that there is no problem with crushing capacity, nor storage capacity, nor export markets. If production is higher than expected, the product with be crushed and exported without a second thought.

Peanut and Peanut Products

Domestic peanut consumption is low in Argentina with the majority of the production destined for the confectionary export market. Peanuts that do not meet food-grade standards are utilized for crushing. Crush for MY2009/10 is lowered to 140,000 MT (down 25,000 from the official USDA number). Based on official crush data published by the Ministry of Agriculture, only 118,000 MT have been crushed from March 2010 through February 2011. Based on historic trend analysis, it is unlikely that 45,000 tons will be crushed in February. In addition peanut oil and meal consumption are low with most oil being exported and meal used for residual feeding.


The National Agricultural Trade Control Agency (ONCCA) regulates agricultural exports in Argentina and requires exporters to solicit export registrations (ROEs). Approval of ROEs is generally automatic for oilseeds and there are two different embarkation periods, either 45 or 180 days, depending on when the exporter pays the required export tax. If paid within 5 days of soliciting the ROE, the exporter is granted an embarkation period of 180 days. If paid at the time of export, the exporter is granted a 45 day embarkation period. Export taxes on oilseeds are as follows:

Soybeans, 35%
Soybean Oil, 32%
Soybean Meal, 32%
Sunflowerseed, 32%
Sunflowerseed Oil, 30%
Sunflowerseed Meal, 30%
Peanuts, 23.5%
Peanut Oil, 5%

In February, the government announced that ONCCA was to be dismantled and replaced by a new agency. Up until now, ONCCA is still functioning and issuing ROEs. For more information on this, see the policy section below.

Soybean and Soybean Products

Soybean exports for MY2009/10 are estimated at 13.725 MMT (85,000 MT higher than the USDA estimate). Official Global Trade Atlas (GTA) data shows 13.6 MMT exported through December 2010. Ministry of Agriculture shipments data, which traditionally tracks very closely with GTA, shows only 75,000 MT shipped from January through mid-March with almost 50,000 MT expected the final two weeks of March.

Sunflowerseed and Products

Sunflower oil and meal exports for MY2011/12 are estimated at 900,000 MT and 650,000 MT, respectively, based on higher production and steady domestic consumption. For MY2010/11, exports for oil and meal are raised to 1.1 MMT (up 150,000 MT) and 850,000 (up 200,000 MT) respectively due to increased production this season.

For MY2009/10, sunflower oil exports are dropped by 65,000 MT to 625,000 MT. According to official trade data, nearly 515,000 MT have been exported though December 2010. Official Ministry of Agriculture port data shows an addition 110,000 MT that was shipped in January and February. The total export estimate for 2009/10 is 625,000 MT.


According to a stocks publication released by Argentina’s National Agricultural Trade Control Agency (ONCCA) in November 2010, there is over 52 MMT of fixed storage capacity available in Argentina for grains. This does not include private on-farm silos or silo bags, which together, add at least an additional 18 MMT according to post contacts.

Beginning soybean stock estimates for MY2009/10 are above the levels published by ONCCA in December 2010, which do not include on farm storage. Contacts indicate over the last few years, producers have had more and more incentive to hold on farm stocks year-over-year as physical assets instead of selling the commodity and depositing the money in a bank. After the financial crisis in 2001 when there was a freeze on bank accounts, producers began investing their money in anything but untrustworthy bank accounts. Today, they often purchase new land, if any is available, or condominiums in Buenos Aires, or perhaps for a shorter term, hold onto their grain in large silo bags. For meal and oil products, little to no stocks are held year over year.


On February 24, 2011 the government eliminated the National Agricultural Trade Control Agency (ONCCA) which, since 2008, has issued and regulated export licenses (ROEs) in the grain and beef sectors and administered subsidies to producers. On the same day another regulation was published announcing a new agency that will handle ONCCA’s responsibilities, the Group of Coordination and Evaluation of Subsidies for Internal Commerce (UCESCI in Spanish). The new agency will have more oversight than ONCCA and will be lead jointly by the Ministry of Agriculture, the Ministry of Economy, the Ministry of Industry as well as the Ministry of Internal Commerce and the Customs and Tax Agency. Thus far, the elimination of ONCCA has had no effect on the grain market and it appears that ONCCA is still issuing ROEs and publishing the data on their public website (as of March 23, 2011).

Within the next few years, new varieties of genetically modified soybeans seeds will be coming into production in Argentina. Current law allows producers to save seeds and for use on their own farms, but prohibits the producers from selling the seeds. This essentially means that producers only have to pay royalties on the initial purchase of seeds. Because the intellectual property laws that provide protection for the farmer and the lack of effective enforcement, in 2004, Monsanto stopped investing in round-up ready (RR) soybeans and has not since introduced or sold any new varieties in Argentina. Today, nearly seven years later, RR soybeans are the only variety currently used throughout the country. Producers and seed companies have produced a draft agreement that will allow producers to use new varieties of seeds and pay royalties to Monsanto. These varieties include RR2Y and RR2YB7, both produced by Monsanto. According to post contacts, production and benefits of the new varieties should be seen around 2014. For more information on biotechnology in Argentina, see GAIN 2010 Annual Biotechnology Report.

Elections will take place in October 2011. It is still too early to speculate what effect, if any, the outcome of the elections will have on farmers’ decisions to plant during the 2011/12 marketing year.

Further Reading

- You can view the full report by clicking here.

April 2011

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