Drought and Frosts Are Threatening Argentina’s Record Wheat Crop

(Bloomberg) -- A drought coupled with bouts of frost may curb wheat output across swaths of Argentina, the Buenos Aires Grain Exchange said in a report.

“Current conditions are unfavorable for growth and development,” analysts led by Esteban Copati wrote.

The impact of dryness that started in March is now being made worse by “frequent and intense” frosts. Wheat plants in the north -- which are in yield-defining development stages -- may produce 50% less. Damage in southern areas, known as Argentina’s bread-basket, is lighter. But rain is needed for plants there to recover from delayed growth.

Argentina has been expected to produce a record wheat crop after the government spared shipments of the grain from a tax hike. But the drought limited planting, which reined in some estimates.

Locusts

Swarms of locusts are also flying nearer to crop areas, according to federal agency Senasa, which is in charge of managing the pest. Swarms recently crossed into northern Cordoba province, home to about 8% of Argentina’s wheat.

But the real issue right now is the weather, Copati said.

“If we don’t start to get rain, the wheat will be so dry that the locusts will only have dry grass to eat,” he said in an interview.

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