A reduced Argentine crop would squeeze global supplies of the feed grain to levels not seen in at least four years. The U.S. Department of Agriculture on Thursday lowered its global end-of-season corn stocks projection for this season to the lowest since 2014, while its 2019 ending stocks outlook was cut to a six year low.
Argentina's normally fertile Pampas grains belt was scorched by a drought that gave way to torrential rains in April, which further complicated harvesting. About 70 percent of the 2017/18 crop has been harvested, the Buenos Aires Grains exchange said in its weekly report.
"Yields remain below the initial expectations," the report said. "Production of later-planted corn in Cordoba province was hurt by lack of ground moisture. If this trend continues, final corn output for the season is likely to be negatively impacted."
The national average yield stands at 6.3 tonnes per hectare. Area losses are estimated at 192,000 hectares, the report said.
The exchange's existing 2017/18 crop estimate of 32 million tonnes would mark a decrease of 7 million tonnes versus 2016/17.
The Rosario grains exchange also expects a 2017/18 Argentine corn crop of 32 million tonnes.
"Corn planted early in the season was less hit by the drought, while late-planted corn has had areas where yield losses are worse than what would correspond to the published estimate of 32 million tonnes," said Ezequiel de Freijo, chief economist at the Argentine Rural Society, a leading farm group.
"The yield scenario is very hard to predict. There is a lot of disparity in yields obtained in different areas, on different planting schedules, using different technologies," he added.