ARGENTINA – Argentina’s 2022-23 wheat crop projections continue to trend downward as the country continues to experience a prolonged drought, forcing farmers starting to abandon some lots of wheat.

The biggest wheat producer and exporter in South America is now expected to harvest a 16-million-tonne crop, 500,000 tonnes lower than the Rosario Grains Exchange’s previous forecast, according to Reuters.

The report also noted that a separate 2022-23 wheat crop estimate from the Buenos Aires Grains Exchange forecast a harvest of 16.5 million tonnes, down from the exchange’s prior forecast of 17.5 million tonnes.

The exchange had earlier said that the percentage of the area sown with wheat with regular or dry humidity went from 29% to 46%, while the percentage of lots in regular-to-bad conditions rose to 34% from 18%.

The Foreign Agricultural Service of the US Department of Agriculture is not promising either. Projections from the department stand at 17.5 million tonnes, which would still be Argentina’s smallest wheat harvest since 2015-16.

Despite its current misfortunes, Argentina is the world’s top exporter of processed soy oil and meal and an important producer of corn, wheat and barley for world markets.

Argentina grains exports brought in some $3.4 billion in August, a 5% increase from July, an industry group said on Thursday, as the South American country tries to boost the flow of foreign currency to rebuild depleted central bank reserves.

The combined oilseed industry and grains export chambers CIARA-CEC said that the value of dollars from farm exports rose 11% year-on-year in the month to what it called a “historic record”, hitting $25.7 billion for the year.

This season is however expected not be as good as wheat planting was completed months ago, with harvesting expected to start in late October and November.

Government officials were scheduled to meet with Argentine wheat millers and exporters this week to discuss worries over the wheat crop and potential shortages for the domestic market.

Brazil, which is the largest importer of Argentine wheat, has enjoyed good weather and may not be as dependent on imports in 2022-23.

According to Conab, Brazil is projected to produce a record crop of 9.4 million tonnes, which is 22% higher than last year’s output.