South American production questions linger

An ag economist says there are lingering questions about South American crop production.

Brian Basting, with Advance Trading in Bloomington, Illinois, says Argentina’s corn crop is having issues.

“Corn Leaf Hopper is transmitting this corn stunt disease and that’s really hit the corn.”  He says, “It doesn’t affect the beans, but it hit the corn bad. They have been expecting anywhere from a 55 to 57-million-ton crop now more folks are saying maybe it might be below 50.”

Basting says that’s still an improvement over last year’s crop.

But to give you some perspective, last year was 37 tons with a drought.”  He says, “So we’re not looking at a catastrophic situation.  Significant and to give the market a little bit of support, but not a mover like last year, for example, that drought in Argentina was really a big-time mover.”

He tells Brownfield catastrophic flooding has also impacted some of Brazil’s soybean crop.

“I would say anywhere from 2 to 4 million tons of soybeans were lost and the general consensus seems to be that those beans are going to be abandoned.”  He says, “Keep in mind that Brazil grows around 150 million tons, so 3 million is significant, but it’s not like we’re taking away 20% of the beans.”

Bastings says the production issues have been a factor in short-term market support, but he says U.S. planting progress continues to be the market’s priority.

AUDIO: Brian Basting – economist with Advance Trading

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