Argentina's Corn: The Nuance of "Abundant Supply" and Price Drops (Early 2024 Context) The 31.23% year-on-year price plummet reported in early March 2024 was largely a reflection of the record production from Argentina's 2023/2024 corn season. Favorable weather conditions in 2023 allowed for a substantial increase in output, leading to an oversupply in the market. This surge in availability, combined with a less significant decrease in Brazilian production than anticipated and increased supply from the US, created a bearish sentiment in the international corn market. This "abundant supply" drove prices below equilibrium points, leading to expectations of improved yields and pushing down prices. The 2024/2025 Season: A Different Outlook Fast forward to mid-2025, and the narrative around Argentina's corn production and prices has evolved. While wholesale yellow maize prices in Argentina did see a seasonal decline of 5-10% month-on-month in May 2025 due to ongoing harvest supplies, the year-on-year comparison tells a different story. Higher Prices Year-on-Year: In May 2025, corn prices in Argentina were reported to be 30% higher year-on-year. This significant increase reflects expectations for a drought-stricken, below-average production for the current 2024/2025 season, coupled with a weakening local currency. Production Estimates Revised Down: The USDA's May 2025 report estimated Argentina's corn production for MY 2024/25 at 50.0 million metric tons, unchanged from the previous month, but down 2% from MY 2023/24. Other reports also indicated potential yield shortfalls in northern Argentina due to adverse weather, despite higher-than-average yields in central Argentina attempting to balance the overall estimate. Harvest Progress: As of April 21, 2025, Argentina's corn harvest was 23.1% complete nationwide, with varying progress across regions. Average nationwide corn yield had shown slight declines for two consecutive weeks, and expectations were for further declines as the harvest progressed. Export Forecasts: World corn exports are expected to fall by 2.4% in the 2024/25 season. Argentina's exports are projected at 36 million tons, down from the previous season's higher volumes. While corn grain exports increased by 46% in 2024 compared to 2023, the outlook for 2024/25 points to a reduced export volume compared to the previous, exceptionally strong year. Key Factors Shaping Argentina's Corn Market in 2025: Weather Conditions: While early 2024 benefited from favorable weather, the 2024/2025 season has faced challenges including persistent drought in key growing regions and concerns over insect infestations (like the corn stunt, or "chicharrita") that impacted planted areas in MY 2024/25. Global Supply and Demand Dynamics: The global corn balance for 2024/25 is expected to remain resilient, but with overall world corn exports projected to decline slightly. Competition from Brazil and the US, combined with potentially lower demand from China, all influence Argentine prices. Local Economic Policies and Currency Fluctuations: The weakening Argentine currency can make exports more attractive in local currency terms, but also impacts the cost of inputs for farmers. Government policies, including temporary lowering of export taxes on grains, also play a role. Farmer Decisions: Farmers' choices between corn and soybeans, influenced by profitability expectations and weather patterns, directly impact corn planted area and, consequently, production. Conclusion While the memory of a significant price plummet in early 2024 due to an abundant supply from the previous harvest is still fresh, the current reality for Argentina's corn in mid-2025 suggests a different trajectory. The 2024/2025 season is grappling with a more constrained supply outlook due to adverse weather and other production challenges. This has already translated into a notable year-on-year price increase, demonstrating the powerful impact of supply dynamics and global market forces on a vital agricultural commodity. Buyers and sellers alike will continue to closely monitor weather patterns in South America, global demand shifts, and policy changes to navigate the volatile corn market.