Argentina Allows More Time for Wheat Shipments Amid Drought, Potentially Impacting Global Supply and Prices.

MUMBAI, April 20 (Commoditiescontrol): Argentina Allows More Time for Wheat Shipments Amid Drought, Potentially Impacting Global Supply and Prices.

Argentina's government has authorized a temporary extension for grain exporting firms to reschedule wheat shipments without penalty. The move comes as the country experiences a historic drought, which has significantly shrunk its wheat crop. As a result, the extension is expected to impact wheat supply from Argentina to global markets.

Under the extension, potential wheat exporters have been given an additional 360 days to ship their products. The extension covers shipments that start between December 1, 2022, and July 31, 2023. The previous extension, which was granted in November, covered sales with shipments beginning in the first two months of the year.

The drought has significantly affected Argentina's 2022/2023 wheat harvest, with production reaching just 12.6 million tonnes. This is down 43% compared to the 22.1 million tonnes produced during the previous harvest. The drought has also impacted the country's major farm exports, including corn and processed soybeans, which are key sources of foreign reserves for its cash-strapped central bank.

The extension is likely to delay the delivery of wheat to global markets, which could lead to higher prices for wheat and other grains in the short term. However, the longer-term impact will depend on the severity of the drought in Argentina and other wheat-producing countries' ability to fill the global supply gap. Overall, the extension is a response to the country's difficult agricultural conditions and is a reminder of the vulnerability of global food supply chains to environmental and economic shocks. (By Commoditiescontrol Bureau; +91-9820130172)