Executive Summary
Torrential downpours have inundated Argentina’s primary crop regions, halting soybean and corn harvests and severely damaging infrastructure and stored grain. Between May 15 and 18, over 80 mm of rain fell in Buenos Aires province—three to four times the monthly average. With 730,000 hectares of soybeans still unharvested, Argentina’s status as the world’s top soymeal exporter is under pressure.
Forecasts indicate a brief drying window through May 23, but a new system arriving May 24 could deliver another 28 mm, compounding an already critical situation. The Buenos Aires Grains Exchange has flagged potential downgrades to its 50 MMT soybean and 49 MMT corn estimates. Market implications include tightening global meal supply, corn logistics disruptions, and rising volatility in feed and biofuel input costs.
Market Snapshot
| Metric | Current Estimate | Change / Risk |
| Soybean Production | 50.0 MMT (pre-flood) | Downgrades expected |
| Corn Production | 49.0 MMT (pre-flood) | Logistics, field loss risk |
| Unharvested Soy Area | 730,000 hectares | Most are at flood risk |
| Buenos Aires Rainfall (May) | >80 mm in 4 days | 300%–400% of normal |
| Next System Forecast | May 24: 28 mm forecast | Additional flooding possible |
Supply & Infrastructure Impacts
Harvest Delays:
Heavy flooding has rendered rural roads impassable, making mechanized harvest operations impossible in key zones such as Salto and San Antonio de Areco.
Silobag Loss Risk:
Stored soybeans in silobags are at elevated risk of spoilage, raising concerns over Argentina’s crush and export quality pipeline.
Export Corridor Strain:
Any delays to Rosario port throughput—already vulnerable to infrastructure and river-level disruptions—could ripple through global supply chains for soymeal, oil, and corn.
Demand & Macro Factors
- Asia & EU Buyers: Risk of short-term meal shortages or higher premiums, especially in Southeast Asia.
- U.S. Crush Margins: Supportive in the short term as Argentina-origin meal faces quality downgrades.
- Brazil Opportunity: Short-term rerouting of demand may benefit Brazilian crushers and exporters.
Forecast Outlook: Buenos Aires (May 20–26)
| Date | Max (°C) | Min (°C) | Rain (mm) | Wind (km/h) |
| May 20 | 16.9 | 6.0 | 0.0 | 7.4 |
| May 21 | 15.0 | 8.1 | 0.0 | 7.8 |
| May 22 | 16.9 | 7.0 | 0.0 | 6.5 |
| May 23 | 16.4 | 10.8 | 0.0 | 14.1 |
| May 24 | 15.7 | 14.0 | 28.3 | 17.4 |
| May 25 | 19.6 | 12.7 | 2.6 | 9.4 |
| May 26 | 18.7 | 13.1 | 0.0 | 8.7 |
Key Takeaway: A 4-day dry window provides limited recovery time before renewed rain threatens re-flooding of unharvested fields.
Price Outlook
- Soymeal (CME Futures): Bullish bias near term; potential breakout if export lineups stall.
- Corn (FOB Argentina): Basis widening expected due to freight, access, and grade issues.
- Soybeans (CBOT): Watch for fund reallocation as South American supply risks reprice risk premiums.
Strategic Recommendations
| Stakeholder | Suggested Action |
| Grain Traders | Monitor Argentine FOB meal offers and U.S.–Brazil premium spread |
| Importers | Secure forward coverage through July, especially for the meal and corn |
| Producers | Consider soymeal–corn spread hedges to capture margin expansion opportunities |
| Livestock Feeders | Expect meal price upside; consider ration flexibility or substitution |
Conclusion
The Argentina flooding event is more than a local weather anomaly—it is a macro supply threat for global feed and biofuel markets. With harvest disruption, storage risk, and renewed rainfall imminent, markets must reassess the downside potential in exportable balance sheets. Expect heightened volatility and sustained risk premiums unless the forecast improves significantly.
Disclaimer: This communication is intended for informational purposes only and does not constitute trading advice. Futures and options trading involve substantial risk of loss and are not suitable for all investors
