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By: Editorial Team, StoneX Media
Argentina harvested around 23.4 million tonnes of wheat, well above initial estimates for the season, and a run of export tax cuts has made Argentine FOB prices more competitive than those of other major exporters. Argentina wheat exports are gaining ground as a result, filling the gap left by Russian wheat that attacks on Black Sea ports and vessels have bottled up. For importers such as Brazil, which relies on Argentina as its main supplier, the shift offers a more competitive source of wheat alongside a fresh weather risk at harvest.
Raphael Bulascoschi, StoneX Brazil Market Intelligence Analyst, tracks grain, oilseed and soft commodity markets from Campinas for commercial agricultural clients across South America, and contributes to the firm's quarterly commodity outlooks and market intelligence reports. His work examines how agricultural production and policy in Brazil move domestic and global commodity markets, supporting the risk management decisions of buyers and producers across the region.
Argentina wheat exports hold a clear pricing edge over rival origins after the government of Argentina began cutting export taxes. According to Bulascoschi, "the government of Argentina has been cutting export taxes, which has made Argentina FOB prices more competitive than those of other major exporters". That advantage arrives as Russia, the largest wheat exporter in the world, struggles to ship through the Black Sea, redirecting the trade flows of major importers toward other origins. "Argentina is the big beneficiary of this scenario," he says. For wheat buyers, the outcome is a more competitive alternative supply at a time when the market is pricing in Black Sea shipping risk.
Argentina's wheat crop of around 23.4 million tonnes sits below the previous record of 27.8 million tonnes but well above initial estimates, which shifts attention from volume to the harvest itself. As Argentine harvesting gets under way, Bulascoschi points out that "the risk of heavier rainfall linked to El Niño could affect the crop, mainly in terms of quality". Brazil is notably exposed, since El Niño tends to bring more rain to Argentina, its main wheat supplier. Consequently, heavier rain could put a premium on higher-quality wheat, raising costs for Brazilian mills even if Argentine export volumes hold up.
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--- Written by Frédéric Guétin, StoneX Media Producer
--- Expert: Raphael Bulascoschi, StoneX Brazil Market Intelligence Analyst
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Argentina's strong wheat harvest and a run of export tax cuts have made its wheat more competitive than wheat from rival exporters, just as Black Sea disruption bottles up Russian supply. The main remaining risk is the harvest itself, where heavier rain linked to El Niño threatens the quality that Brazilian importers rely on.
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