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Argentina Agribusiness Report Q3 2009

Published by: Business Monitor International

Published: Jun. 29, 2009 - 54 Pages


Table of Contents


Executive Summary
SWOT Analysis
Nigeria Agricultural SWOT
Industry Business Environment Overview
Market Overview
Supply Demand Analysis
Argentina Sugar Outlook
Table: Argentina Sugar Production, Consumption & Trade
Table: Argentina Sugar Production, Consumption & Trade
Industry Forecast - Argentina Rice Outlook
Table: Argentina Rice Production, Consumption & Trade
Table: Argentina Rice Production, Consumption & Trade
Industry Forecast - Argentina Dairy Outlook
Table: Argentina Milk Production & Consumption
Table: Argentina Butter Production, Consumption & Trade
Table: Argentina Cheese Production, Consumption & Trade
Table: Argentina Whole Milk Powder Production, Consumption & Trade
Table: Argentina Milk Production & Consumption
Table: Argentina Butter Production, Consumption & Trade
Table: Argentina Cheese Production, Consumption & Trade
Table: Argentina Whole Milk Powder Production, Consumption & Trade
Industry Forecast - Argentina Livestock Outlook
Industry Forecast - Argentina Livestock Outlook
Table: Argentina Poultry Production, Consumption & Trade
Table: Argentina Pork Production, Consumption & Trade
Table: Argentina Beef & Veal Production, Consumption & Trade
Table: Argentina Poultry Production, Consumption & Trade
Table: Argentina Pork Production, Consumption & Trade
Table: Argentina Beef & Veal Production, Consumption & Trade
Industry Forecast - Argentina Grains Outlook
Wheat
Table: Argentina Wheat Production, Consumption & Trade
Table: Argentina Wheat Production, Consumption & Trade
Corn
Table: Argentina Corn Production, Consumption & Trade
Table: Argentina Corn Production, Consumption & Trade
Barley
Table: Argentina Barley Production, Consumption & Trade
Table: Argentina Barley Production, Consumption & Trade
Sorghum
Argentina Sorghum Production, Consumption & Trade
Table: Argentina Sorghum Production, Consumption & Trade
Industry Forecast - Argentina Grains Outlook
Table: Argentina Soybean Production, Consumption & Trade
Table: Argentina Soybean Production, Consumption & Trade
Competitive Landscape
Table: Agricultural Commodity Producers & Traders
Table: Agribusiness Suppliers
Table: Integrated Agricultural Producers
Market Strategy - Grains Update
Corn
Table: Corn
Soybean
Table: Soybean
Rice
Table: Rice
Wheat
Table: Wheat
Market Strategy Softs Update
Cocoa
Table: Cocoa
Coffee
Table Coffee
Milk
Table: Milk
Sugar
Table: Sugar
Downstream Supply Chain Analysis
Industry Forecast Scenario - Food
Argentina Food Consumption Indicators -- Historical Data & Forecasts
Confectionery Value/Volume Sales - Historical Data & Forecasts
Food & Drink Trade Balance - Historical Data & Forecasts
Industry Forecast Scenario - Retail
Argentina Mass Grocery Retail -- Value Sales by Format -- Historical Data & Forecasts
Sales Breakdown by Retail Format Type -- 2008 & 2018
Economic Activity
Company News Alert - Danone Reconsidering Merits Of JV Strategy?
BMI Forecast Modelling
How We Generate Our Industry Forecasts

Abstract

In BMI's Argentina Agribusiness Report for Q3 2009, we introduce the new Soybean Outlook. Soybeanproduction has exploded in Argentina over the past few decades. In 1970, less than 50,000 hectares (ha)of land was planted with the crop. In 2008, more than 16mn ha were given to soybeans. In the past decadealone, the area harvested has more than doubled, changing the face of Argentinian farming. Prior to thecurrent problems at least, Argentina was the world's largest exporter of soybean meal and oil and thirdlargest exporter of soybeans behind only Brazil and the US.

In 2009, Argentinian agriculture is in crisis. Soybean production has not escaped. We forecast this year'sharvest to be 28% smaller than the 2008 crop at 33.23mn tonnes. The long drought in the Southern Coneof South America has seen yields plummet as crops are wiped out by water shortages. The volume ofsoybeans crushed domestically will also fall this year owing to the tight supplies, though by a muchsmaller amount. We expect exports of whole soybeans, however, to fall by as much as 50%.

Despite this setback, we expect the rise of soybeans to continue in Argentina once climatic conditionsallow. Strong economic growth in emerging markets, most notably China, will see incomes rise andconsumption of meat rise alongside. This will keep demand for Argentina's soybean and soybeanproducts exports high. Domestic consumption will also be helped by a new renewable fuels law cominginto force next year that mandates for all diesel sold in the country to contain at least 5% biodiesel. Weexpect the production of biodiesel from soybean oil to rise rapidly this year in preparation for theincreased demand.

Despite the rapid fall in soybean production, we do not expect it to be the crop hit worst by the drought.

Our forecasts for wheat and corn production are even bleaker. For wheat, we expect production toplummet 50.6% year-on-year (y-o-y) to 8.30mn tonnes while for corn we forecast a drop of 40.0% y-o-yto 12.31mn tonnes. Exports of these crops will fall to the lowest level in years. We expect it to be sometime before production of these crops reaches the levels seen in 2008. Farmers have been encouraged toturn to other, hardier crops and the area planted to wheat and corn is expected to fall sharply this year.

Less stringent government control on exports has also provided incentives for farmers to move to moreminor crops.

Also struggling badly is Argentina's iconic beef industry. With much of the pampas dried out, stock losshas been heavy and slaughter weights are well down. We expect production to fall this year and nextowing to the reduced size of the national herd. If the weather doesn't improve soon, production could fallso low next year that imports of beef are required to meet demand. An unheard of situation in Argentina,formerly the world's number one beef exporter.

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