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Argentina, one of the largest agricultural producers in the world, is facing a drought that is severely affecting its crops.
One of the main factors that have caused the dry climate in Argentina is the phenomenon known as La Niña, a climate anomaly that occurs in the Pacific Ocean and affects the climate in several parts of the world.
In this third consecutive year of La Niña, there was a drop in rainfall and higher temperatures, reducing the productivity of some of its main products such as soybeans, corn and peanuts.
This situation is no longer the case today.
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According to the National Meteorological Service of Argentina, the last 5 years have been characterized by a period of prolonged drought in several regions of the country, mainly in the center and north. In 2020, for example, rainfall was 25% below the historical average in the Buenos Aires region.
This lack of rain resulted in a significant decrease in water reserves in the soil, harming plant growth.
Furthermore, the highest temperatures recorded in recent years have accelerated the water evaporation process, which has further aggravated the situation.
Certainly, climate data from recent years is fundamental to understanding the current drought situation in Argentina and its impacts on agricultural production.
Peanut
Peanuts are an important crop for Argentina, being the regional economy that attracts the most dollars to the country. The production and commercial chain of this legume employs more than 12 thousand people and generates more than US$1 billion in exports annually.
However, the climate issue has caused concern among producers, who have struggled to maintain profitability, amid a scenario that was already complicated due to the increase in costs and the problems that the country was already facing.
Peanuts are cultivated mainly in the Córdoba region where, according to estimates from the first half of March by the Cereals Exchange, production is expected to fall by 39% in relation to the average of the last two years.
“Since the last quarter of last year, we already knew about the chances of the harvest being influenced by La Niña. But there were also unpredictable episodes, such as the February frost, something completely historic,'' said Melinda Rodrigues, peanut oil specialist at Aboissa Commodity Brokers.
Complementing this, Giovanna Nascimento, also a peanut oil specialist at Aboissa, explains: “To cushion the effects of the drought on agricultural production, it is necessary for the Argentine government to take measures such as reducing taxes for affected producers and investing in technologies that help conserve water and increase efficiency in the use of water resources. However, it is likely to take some time for these measures to have a significant impact on production''.
As a consequence of the declines in agricultural production, the Argentine economy is also affected. The country is a major exporter of soybeans, corn and peanuts, and a decrease in the production of these commodities could have a significant impact on the country's exports and revenue.
Furthermore, the drought is causing concerns regarding the food supply for the population. Grains are an important component in Argentines' diets, and a decrease in production could lead to higher prices and food shortages in a country that already suffers from hyperinflation of more than 100% per year.
Among the measures already taken by the Argentine government, we can mention the announcement of the possible implementation of the “Agro Dollar”, an initiative that aims to alleviate the situation of rural producers, including covering the peanut sector. It is still pending for the government to make the measure official and clarify what the regulation will be like for regional economies.
Remembering that this will be an election year in Argentina and therefore, we will have to pay attention to possible political changes, as we know that this scenario directly impacts the commercialization of grains.
In conclusion, it is important that there is a discussion about the impacts of climate change on agricultural production not only in Argentina, but throughout the world. The dry climate in the country is just one example of the challenges that agricultural producers are facing in an increasingly unstable and unpredictable world.
By: Melinda Rodrigues and Giovanna Nascimento