DOW JONES NEWSWIRES
South America's corn and soybean crops will be smaller than a
year ago due to drought, Archer Daniels Midland Co. (ADM) said
Tuesday.
Grains traders have for weeks been downgrading their
expectations for crops in Argentina and Brazil because of hot, dry
weather, but many analysts have still assumed the total output
would be higher than a year ago because of increased planted
acreage.
But Craig Huss, senior vice president and chief risk officer for
ADM, said the total production would end up below year-ago
levels.
"The dry weather in Argentina has had an impact on corn for
certain, and it's had some impact on soybeans," Huss told investors
in a conference call to discuss ADM's second-quarter earnings.
The U.S. Department of Agriculture earlier this month projected
Argentina corn production of 26 million metric tons, up from 22.5
million a year ago. But many analysts think the USDA will revise
its estimate lower in its February report.
The USDA estimated Argentina's soybean crop at 50.5 million
metric tons, up from 49 million a year ago.
The government's most recent estimate for Brazil's corn crop was
61 million metric tons, up from 57.5 million a year ago, and its
January soybean crop estimate for Brazil was 74 million metric
tons, down from 75.5 million a year ago.
--By Ian Berry, Dow Jones Newswires; 312-750-4072;
ian.berry@dowjones.com