Argentina, South America’s largest wheat producer, is cutting its forecast for the current crop and halting exports to ensure domestic supply as excess rain, heat and fungal diseases harm crops, a government official said.
The forecast is being cut to 10.5 million metric tons from 11.1 million estimated last month, Oscar Solis, an undersecretary at the Agriculture Ministry said in a telephone interview from Buenos Aires today. The government is suspending exports until the end of next month to avoid a domestic shortage, he said.
The governments of President Cristina Fernandez de Kirchner and her predecessor and husband Nestor Kirchner have limited exports of wheat, soybeans and other agricultural commodities in past years in a bid to avoid shortages and price increases, causing conflicts with growers’ associations.
“We’ve always said that we’re a government that aims to privilege the local consumer,” Solis said of the exports suspension. “We’re not changing the rules of the game.”
Wheat for March delivery fell 1.9 percent to $7.905 a bushel at 7:50 a.m. on the Chicago Board of Trade. Wheat futures have dropped 10 percent in the past three months.
Some ships that have already been loaded with wheat may be allowed to depart from Argentine ports, Solis said.
The government plans to release a report with the new forecast between today and tomorrow, he said.
Harvesting for the current 2012-13 season started in November and normally runs through January.
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