WORLD AND ARGENTINE AGRIBUSINESS REFERENCE SCENARIO TO 2025

World Outlook Conference

Nicolás Jorge8 june 2017

Buenos Aires Grain Exchange

Cordoba Grain Exchange

Arg. Oil Industry Chamber (CIARA)

Chamber of Grains Exporters (CEC)

Arg. Wheat Flour Millers Association (FAIM)

Federation of Country Elevators Association

INSTITUTE FOR INTERNATIONAL NEGOTIATIONS ON AGRICULTURE

Created in 1999

To achieve the best possible outcomes

for Argentina in the international

negotiations forums, by strengthening

its capabilities to negotiate.

To improve the information, capacity and depth of analysis of the public and

agribusiness sectors.

To strengthen the Argentine negotiation capability in order to improve the

integration to world trade.

To generate a close, intelligent and transparent communication between the

public sector and the agribusiness sector.

Our Work. Analysis of:

• International agricultural negotiations.

• Domestic agricultural policies of other countries and how they influence our

trade.

• Argentine domestic policies that affect integration to world trade.

INAI Objectives

Reports

• Newsletter (160 issues)

• ERAMA X

• Countries and products

• Special Reports

Events and training

• Conferences

• Round tables

• Courses

Tools

• PEATSim-Ar

• MEPIC

• General Equilibrium Model

• Trade indicators

Our work

inai.org.ar

PEATSim-Ar

● Partial equilibrium model

● GAMS

● Based on ERS - Penn State University (2008)

● Almost completely rewritten

Database

Drivers

• IMF

•USDA

Prices

•Ministry of Agro-industry

• FAO

•World Bank

Supply and demand

• Buenos Aires Grain Exchange

•Ministry of Agro-Industry

•USDA

Other

• Yields assumptions

• Policies

• Elasticities

Am

eri

ca • Argentina

• Brazil

• Paraguay

• Uruguay

• Bolivia

• Chile

• Colombia

• Peru

• Venezuela

• Canada

• Mexico

• USA

• Rest of America

Afr

ica • Algeria

• Egypt

• Rest of Africa

Asi

a • China

• India

• Japan

• South Korea

• Malaysia

• Indonesia

• Singapore

• Vietnam

• R. Southeast Asia

• R. M. East

• R. Asia

Eu

rop

e • European Union

• Russia

• Ukraine

• Rest of Europe Oce

an

ia • Australia

• New Zealand

• Rest of the world

Regions

● Prices

● Planted area

● Harvested area

● Yields

● Production

● Exports

● Imports

● Consumption

● Food

● Feed

● Crush

● Other

● Stocks

Variables

Supply categories

• Crops

• Oils / Meals

• Meats

• Dairy

• Biofuels

Demand categories

• Food

• Feed

• Crush

• Biofuels

• Stocks

• Other uses

Cereals Oilseeds Oilseed oil Oilseed Meal

Rice

Wheat

Corn

Barley

Sorghum

Other c. grains

Soybean

Sunflower seed

Rapeseed

Groundnut

Cotton seed

Palm kernel

Soybean oil

Sunflower oil

Rapeseed oil

Groundnut oil

Cotton seed oil

Palm oil

Palm kernel oil

Soybean meal

Sunflower meal

Rapeseed meal

Groundnut meal

Cotton seed meal

Palm kernel meal

Other Crops Meats and Milk Dairy Biofuels

Cotton

Sugar

Beef and veal

Pork meat

Poultry

Raw Milk

Fluid milk

Butter

Cheese

Skimmed milk p.

Whole milk p.

Other dairy

Biodiesel

Bioethanol

DDGs

Policies

● Import Tariffs

● Tariff rate quotas

● Target prices

● Intervention prices

● Domestic support

● Export subsidies

● Export taxes

● Other exports restrictions

Future work

● Regional outputs within Argentina

● Detailed information on costs

● Linking with other outlooks for world data

● Sensitivity analysis / Montecarlo simulations

WORLD AND ARGENTINE AGRIBUSINESS REFERENCE SCENARIO TO 2025

(ERAMA 2025)

AGRICULTURAL LONG-TERM OUTLOOK FOR ARGENTINA

Simulation(PeatSIM-Ar)

Validation

Assumptions

Drivers

New set of policies

● Removal of restrictions in the foreign exchange market

● Elimination of export restrictions

● Reduction in export taxes

Data from OECD and Agrimonitor-IADB.

Producer support estimate(%PSE) Three year average (2010-12)

61%

54%49% 49%

45%

24%19% 19% 18% 17% 15% 15% 12% 12% 11%

9% 8%5% 3% 3% 3% 2% 1%

-23%

Results 2025

65.578.8

108.8

115.5

140.5

00/01 05/06 15/16ERAMA24/25

ERAMA25/26

6.2%

29.1%

Millions tons

Results 2025

65.578.8

108.8

115.5

140.5

00/01 05/06 15/16ERAMA24/25

ERAMA25/26

6.2%

29.1%

Millions tons

122Proj.

16/17

10,300 15,206

30,00049,332

56,000 60,563

0,000

10,000

20,000

30,000

40,000

50,000

60,000

70,000

Source: ERAMA 2025/26. INAI Foundation

Results 2025 000 tons

Grain & Oilseeds. Production

Thousands of tons

2010/11 2015/16 2025/26 Δ 10 years Δ annual

Grains 48 202 49 350 75 021 52,0% 3,5%

Rice 1 720 1 400 1 845 31,8% 2,4%

Wheat 15 781 10 300 15 316 48,7% 2,9%

Corn 24 553 30 000 49 599 65,3% 4,0%

Barley 2 535 4 250 3 232 -24,0% -1,1%

Sorghum 3 613 3 400 5 029 47,9% 4,3%

Oilseeds 53 633 59 429 65 439 10,1% 1,2%

Soy 49 200 56 000 60 160 7,4% 1,0%

Sunflower 3 400 2 500 3 817 52,7% 2,6%

Peanut 1 033 929 1 462 57,4% 3,6%

Total 101 836 108 779 140 459 29,1% 2,3%

Source: ERAMA 2025/26. INAI Foundation

Results 2025

Grain & Oilseeds. Planted area

Thousands of hectares

2010/11 2015/16 2025/26 Δ 10 years Δ annual

Cereals 10 305 9 715 13 331 37,2% 2,3%

Rice 258 215 241 12,3% 0,9%

Wheat 4 700 3 600 4 905 36,3% 2,1%

Corn 3 800 3 850 6 136 59,4% 3,2%

Barley 625 1 200 921 -23,3% -1,4%

Sorghum 922 850 1 128 32,7% 3,1%

Oilseeds 20 537 21 656 22 164 2,3% 0,2%

Soy 18 500 20 100 19 965 -0,7% 0,1%

Sunflower 1 730 1 220 1 794 47,1% 2,1%

Peanut 307 336 404 20,1% 1,7%

Total 30 843 31 371 35 495 13,1% 1,0%

Source: ERAMA 2025/26. INAI Foundation

Results 2025

Soybean export tax

35%

30%

18%

0%

5%

10%

15%

20%

25%

30%

35%

40%

Jan

-15

May-1

5

Sep

-15

Jan

-16

May-1

6

Sep

-16

Jan

-17

May-1

7

Sep

-17

Jan

-18

May-1

8

Sep

-18

Jan

-19

May-1

9

Sep

-19

Jan

-20

May-2

0

Sep

-20

Buenos Aires Grain Exchange with data from Márgenes Agropecuarios

March - May ave. 15/16 16/17 17/18 16 vs 15 17 vs 16

Diesel kg x litre 11.8 7.0 6.7 -41% -4%

Herbicide kg x litre 81.7 56.7 37.7 -31% -34%

DAP 100 kg x tn 58.3 38.0 32.3 -35% -15%

Urea 100 kg x tn 46.3 25.7 26.3 -45% 3%

Input / Output

0.00

10.00

20.00

30.00

40.00

50.00

60.00

70.00

80.00

90.00

Diesel Herbicide Diammoniumphosphate

Urea

15/16 16/17 17/18

Key issues

• Logistic competitiveness is mainly explained by short distance to ports.

• However, transport costs are increasing.

• Increase in production in the north-west

• Lack of investment in roads

• 85% transported by truck

• There are new investment programs.

Logistic and Infrastructure

• Opening new markets.

• Intensifying negotiations agenda.

• Expanding and deepening MCS Trade Agreements.World markets

• Poor farm returns caused a decline in technology levels.

• Due to recent positive incentives, the trend in technology adoption is already displaying an improvement.

Technology (RETAA)

Conference on Summer CropsBuenos Aires Grain Exchange

IV Round Table on Trade Policy AnalysisINAI Foundation

ERAMA 2026

THANK YOU!

Contact UsINAI Foundation

Street: Corrientes 127 4º

njorge@inai.org.ar

www.inai.org.ar

+5411 43121092

@Fundacion_INAI

Fundación INAI