While the soybean harvest progresses at a slow pace, the consequences of the drought that hit production are beginning to be seen. And it hits directly on the soy industry, the sector that generates the most dollars in the country.
Gone are the 60 million tons of beans that were produced in 2015 and the concept of "sojización" that was spoken of in those times, when it was planted even on the shoulders of the roads. From that year, the harvest began to decline until reaching 43 million tons in the 2021-22 cycle and 20 million tons this year impacted by drought.
Given this lack of production, the industry began importing soybeans from Paraguay and Brazil. Between January and March, 2.7 million tons were imported against 890,000 tons that had been purchased abroad in the same period of 2022.
Of the total imported in the first quarter, 2 million tons (74%) came from Paraguay. From the 2018/19 to 2020/21 seasons, more than 92% of Argentina's soybean imports came from that destination.
"Last year that share fell to 57.6% due to the severe drought that Paraguay experienced, which went from 9.6 to 4.2 million tons, which limited exports to Argentina, only partially offset by soybeans from Uruguay, Bolivia and Brazil," said Guido D'Angelo, market analyst at the Rosario Stock Exchange.
This year, with Paraguayan soybean production 2022/23 returning to around 9.5 million tonnes, the neighbouring country is expected to regain share of the Argentine soybean market for milling. "If we take the last three years (excluding the 2021/22 drought), Paraguay exported about 42% of its production to Argentina, about 4 million tons," he added.
And the player that joins strongly this year is Brazil, said the analyst, which was not a usual supplier of soybeans for Argentine industrialization, but that comes with record harvest -150 million tons- and FOB prices down, which also allows its import strongly to our country.
"Unlike Paraguay, which exports soybeans to Argentina with barges heading south on the Paraná, most Brazilian exports have been recorded on ocean-going vessels,"
"Imports from Brazil occur in a large number by ship, but this year the ship is about 40% and the remaining 60% corresponds to barge. It is a much larger proportion than Paraguay, which practically everything is given by barge," he said.
In volumes, it is expected to be a historic year of Brazilian soybean imports. In May it has already unloaded 130,000 tons, with projections of unloading 230,000 tons in the next 20 days. "The year 2018 was a record import of Brazilian soybeans, and less than 650,000 tons of soybeans were imported in the whole year. In these first two months of the 2022/23 campaign we would have already broken the record," he said.
In addition, the Argentine industry also traded some 80,000 tons of the oilseed from Bolivia.
The same institution predicts that about 10 million tons will be imported in total during the year against the 3 to 4 million tons that are usually imported for a quality issue.
"Temporary importation would be half of the available harvest. It is something unprecedented," said Gustavo Idígoras, president of the Chamber of the Oil Industry of the Argentine Republic (CIARA).
Given this panorama, from the soy industry – the cluster that generates the most dollars – they project that the volume of processed soybeans estimated for this year will be the lowest in 18 years.
According to Ciara's projections, the annual soybean processing volume by 2023 will stand at 27 million tonnes. This represents a decrease of 11,459 million tons or 30% compared to 2022 when it reached 38,459 million.
It also implies a decrease of 18 million tons, 40% compared to 2016, the year in which a record milling of 45 million tons was reached. So the idle capacity of the factories reaches 65% and in the second semester plant closures are projected.
The fall in foreign exchange income calculated by Ciara for this year is US $ 18,777 million, considering the lower production and exportable balances. Between January and April 2023, the soy complex entered foreign currency for US $ 5,237 million, this is US $ 5,861 million less than in the same period of 2022.