Reference Date: 18-July-2023

Despite above‑average plantings, a below‑average maize output is expected in 2023 due to drought conditions

Harvesting of the 2023 maize crop is ongoing and production is officially anticipated at 41 million tonnes, more than 25 percent below the five‑year average. This is due to prolonged dry spells between October 2022 and January 2023 that severely affected yields. The planted area is estimated at an above‑average level of 10.3 million tonnes, prompted by high domestic prices at planting time.

Planting of the 2023 wheat and barley crops, to be harvested from November, is underway. Heavy rains in early July in southern Buenos Aires Province caused some delays in planting operations, but also favoured germination of early‑planted crops. According to official forecasts, wheat sowings are expected at a below‑average level of 6.1 million hectares, while planted area with barley is set at an above‑average level of 1.6 million hectares. Weather forecasts point to average precipitation amounts in the August‑October period, providing conducive conditions for crop development, except in some localized areas of the centraleastern region, where rainfall amounts are forecast at below‑average levels. There remains some uncertainty regarding production prospects, on account of above‑average rainfall amounts forecast in the November 2023‑January 2024 period, associated with the El Niño phenomenon. If excessive rains materialize during the crop maturation stages or harvesting operations, they could diminish yields or complicate fieldwork activities, with negative effects on the final production.

Below‑average cereal exports forecast in 2023/24 marketing year due to low maize production

Exports of maize, the country’s major exportable cereal commodity, are forecast at 24 million tonnes in the 2023/24 marketing year (March/February), 30 percent below the average, reflecting the sharp decline in 2023 production. As a result, aggregate cereal exports in 2023/24 are forecast at a below‑average level of 40 million tonnes.

Similarly, exports of wheat are anticipated at 6.5 million tonnes in the 2022/23 marketing year (December/November), about 50 percent below the average, as a result of the drought‑stricken harvest in 2022.

Annual food inflation rate reached 117 percent in June 2023 at national level

In 2023, wholesale prices of wheat rose sharply in the April‑June period, as seasonal upward pressure was compounded by concerns over the impact of hot and dry weather conditions in March and April on land preparation and planting operations of the 2023 wheat crops. As of June 2023, prices were 85 percent up from their levels a year earlier, reflecting tight supplies from the below‑average 2022 output. Regarding maize, after a short‑lived decline in May at the beginning of the 2023 harvest, prices stabilized in June, as expectations of the drought‑stricken output offset seasonal downward pressure. Maize prices in June were more than 55 percent year‑on‑year, after sustained increases between August 2022 and April 2023.

Overall, retail prices of food items are steadily rising, amid a difficult macroeconomic situation. In June 2023, the annual inflation rate of food and non‑alcoholic beverages was estimated 117 percent. High food prices have reduced the purchasing power of vulnerable households, limiting their access to food. In November 2022, the government relaunched the Precios Justos Programme to contain price increases, fixing the prices of about 2 000 basic commodities in supermarkets, including staple food items, until the end of July 2023. However, last May, the Programme was revised to allow for a 3.8 percent month‑on‑month increase in prices, on account of rising production and transport costs.

Disclaimer: The designations employed and the presentation of material in this information product do not imply the expression of any opinion whatsoever on the part of FAO concerning the legal status of any country, territory, city or area or of its authorities, or concerning the delimitation of its frontiers or boundaries.

This brief was prepared using the following data/tools:
FAO/GIEWS Country Cereal Balance Sheet (CCBS) https://www.fao.org/giews/data-tools/en/ .

FAO/GIEWS Food Price Monitoring and Analysis (FPMA) Tool https://fpma.fao.org/ .

FAO/GIEWS Earth Observation for Crop Monitoring https://www.fao.org/giews/earthobservation/ .

Integrated Food Security Phase Classification (IPC) https://www.ipcinfo.org/ .