With replenished groundwater supplies, Argentina’s bean crop should recover solidly from last year's devastating drought.

By Dario Bard

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Argentina’s bean planting season got underway with good moisture levels from mid-February into March. This went a long way to restoring groundwater supplies that had remained low following last year’s historic drought. The northern part of the growing area in particular saw its water levels greatly benefitted.

But a dry spell then set in that lasted through late March, and consequently low yields are expected for the early-planted crop, particularly in the southern part of the growing area.

The rains finally returned in late March and continued intermittently into April, delaying planting plans for a significant part of the crop; about 15% was seeded in late March and early April. Consequently, this late-planted crop will likely be harvested from mid-May to July, which increases the risk of early frost in the areas south of Monterrico, Jujuy. Frost has already been reported in central Argentina. South of Guemes, Salta, a historic frost sometimes materializes between May 3rd and 5th; if it doesn’t, bean growers can breathe easy until June, says Eduardo Turbay of Las Martinetas, who recently toured the bean fields of Salta and Jujuy.

“If the moisture levels that we are seeing today persist and we continue to have rain, there shouldn’t be any frost,” he says.

Overall, the general consensus is that the crop is presently in good to very good condition. The late March and early April rains were intense at times, resulting in minor crop damage, but generally the crop is off to a good start thanks to replenished water supplies that have fully recovered in most places. The exceptions are some areas to the south of the Bermejo River, such as Las Varas and Santa Clara.

Even so, the impact of last year’s drought was still felt this planting season, particularly in the form of limited seed supplies, and especially for Argentina’s much sought-after alubia beans. Consequently, growers were unable to plant as many beans as they would have liked.

José Macera of Desdelsur estimates the overall dry bean planted area at 10% to 15% below the average of the past few campaigns (not including last year’s campaign, which was unusually poor due to the historic drought). He also predicts that export volumes will not exceed those of 2011 and 2012 for all bean classes.

Turbay expects the early-planted crop (mostly kidney beans) will start shipping in mid-May, but the bulk of new crop shipments won’t commence until early June, he says.

Others also note that the purity of the varieties will be a factor this campaign, affecting both yields and quality. Some growers planted whatever seed they had on hand, in some cases varieties dating from five years ago, and some experts warn that buyers should be sure to purchase product that has gone through industrial processing in order to assure quality.

Argentina does not provide official planted area statistics, and so IFT spoke with several industry experts to get their best estimates.

Alubias

Some exporters placed the planted area for alubias at 90,000 hectares. Macera’s estimate is higher, between 110,000 and 120,000 hectares. Turbay admits that he lacks contacts in the areas north of Pichanal and Embarcación, Salta, where most of the alubias are grown, but he expressed surprise at these figures; the estimates he has heard range from 40,000 to 60,000 hectares. Turbay also suggested that producers will hold on to a significant share of this year’s crop for seed.

“Last year I think we exported around 3,000 MT of alubia when the norm is 150,000 MT,” says Macera. He estimates this campaign’s overall alubia production at 140,000 MT; he expects more than 100,000 MT will be exported and the rest will be used to generate seed for next year. Industry experts expect it will take Argentina’s alubia production two years to recover from the devastation of the 2013 drought.

Alubia prices are high at the moment in the face of global scarcity. Turbay has heard talk of a minimum of US$ 2,200 FOB for this year’s crop.  

Black Beans

There is a general consensus among industry members that black beans will dominate the harvest. But here estimates also span a wide range, with a low of 100,000 hectares from some producers and a high of at least 180,000 hectares from Turbay. Macera’s estimate comes in at 150,000 hectares.

Turbay is excited about the opportunities Brazil offers for Argentina’s black beans.

“I spoke to Marcelo Lüdders (of Correpar in Brazil) who tells me Brazil consumes 30,000 MT of black beans per month,” he says. “Their internal production covers supply for two to three months, and then Argentina’s production could step in and supply that market for six additional months, through December.”

Black bean prices have been trending downward, with offers to producers dropping to US$ 650 per MT from US$ 800 a month ago. Turbay believes producers won’t accept offers much lower than that.

Earlier this year, Turbay expressed concern about a black market trade in black beans to Brazil, but Macera believes the national government has tightened enforcement at the border and brought the situation under control. Turbay agrees and notes the government has also taken other measures to address this issue in particular and to close the gap between the official and unofficial dollar exchange rates, which had enticed unscrupulous buyers to turn to the black market.

Other Classes

While some exporters estimate the kidney bean planted area at 30,000 hectares, Turbay estimates it is higher, between 40,000 to 60,000 hectares. Macera sees the light red kidney bean area as about the same as last year, perhaps slightly more. With respect to dark red kidney beans, Macera says the planted area is relatively small; he would guess no more than 4,000 hectares. Kidney bean prices presently stand at US$ 1,700 to US$ 1,800 FOB.

Macera estimates that cranberry bean planting will be down 30% to 40% from last year at no more than 8,000 hectares.

Turbay estimates the mung bean planted area at no more than 5,000 hectares. He says demand and prices have increased steadily in recent months, but are now leveling off as Burma’s crop enters the market.