BUENOS AIRES, ARGENTINA — Argentina is expected to produce more soybeans in 2024-25 but the crop faces “several complex challenges and opportunities shaped by weather, economic pressures, and production practices,” according to a report from the Foreign Agricultural Service (FAS) of the US Department of Agriculture.

Soybean production is estimated at 52 million tonnes, up from 49.5 million tonnes last harvest. Producers are shifting to more soy away from corn over fears of the impact of corn stunt, continued low prices, and expected dry conditions, the FAS said.

Higher than expected average temperatures could compromise soil moisture and reduce yields, further complicated by soil moisture deficits that delayed early planting in some regions, it said.

Economic factors will also tip farmers' decisions toward soy, with production costs for soybeans significantly lower than for other crops.

Due to a recent shortage of high-grade seed stock on the market farmers are lowering planting densities to allow each seed more room to germinate but will likely lower total yields, the FAS said.

“Overall, the combination of environmental, economic, and technical challenges paints a complex picture for Argentina's soybean sector in 2024-25,” the FAS said. “While increased acreage and technological advancements may support production, the adverse weather and compromised seed quality may prevent yields from reaching their full potential, and the financial strain on producers remains significant.”

Crush is expected to increase slightly from 41.5 million tonnes to 42 million tonnes.

“Argentina’s soybean crush industry has seen a resurgence in activity this year due to increased domestic soybean production and a steady flow of imports, primarily from Paraguay,” the FAS said.