The sowing of barley will register in this campaign a new increase in the cultivated area -with which will add three consecutive seasons-, driven by a better relationship in the input-output equation in a context of historically high prices and by a potential decrease in the area with wheat.
The Buenos Aires Cereal Exchange (BCBA) estimated that the area planted with barley will grow 8.3% compared to the 2021/22 cycle, up to 1.3 million hectares. Of that total, 100,000 hectares of barley during the previous campaign were destined to the cultivation of wheat.
If this projection materializes, the growth of the implanted area with this cereal will grow 44%, equivalent to 400,000 hectares more than 900,000 hectares planted in the 2020/21 cycle.
In terms of production, the stock market entity reported a record harvest forecast of 5.4 million tons, which would chain the fourth consecutive campaign with an increase in the threshed volume.
As in the case of wheat, this new cycle will take place in an extremely exceptional context, with commodity prices at historically high levels product of the war between Russia and Ukraine, countries that between them account for 30% of world trade in this grain.
For reference, the FOB price of malting barley went from costing US$ 345 a ton on February 24the day the war began at US$ 405 a ton currently.
Beyond this strong improvement in prices, the chief economist of the BCBA, Agustín Tejeda Rodríguez, warned that the Russian invasion of Ukraine also unleashed as a collateral effect a strong increase in production costs, focused on the values of inputs.
“The rise in costs especially affected those crops that are more intensive in the use of technology, such as wheat and barley, which would represent a 45% increase in investment requirements this year,” said the specialist.
Regarding exports of the barley complex, which includes the dispatches of forage and brewing barley, as well as the malt with which alcoholic beverages are produced, could total US$ 1,192 millionwhich would mean an advance of US$ 279 million compared to last year, specified a report from the Rosario Stock Exchange (BCR).
The Bahía Blanca Cereals and Products Exchange (BCP) conducted a survey in recent weeks on planting intentions in the area of influence of the stock market entity, which includes the west of Buenos Aires and the east of La Pampa, which showed that 35 % of producers are willing to increase the area dedicated to barley.
In dialogue with Télam, the economist of the Bahia Stock Exchange, Carolina Volontésaid that this increase in the country’s main barley-producing area is due “to the increase recorded in the value of inputs, for which greater investment will be required, and that is why producers would turn to crops that require fewer applications compared to wheat.
“Also because of the fact that barley is a crop that has a lower political risk“, he added in reference to possible changes in the withholding scheme. “These issues are also variables that producers take into account, beyond the fact that they are two crops that have very high and firm prices both in international markets and in the local market. Volonte added.
This firmness in prices, beyond what is happening with Russia and Ukraine, is due to a “tight balance between supply and demand, with the latter being very firm, especially if we analyze the role that China has played in recent times and the presence it still has today,” he stressed.
