Sunflower continues to gain popularity in Argentina as a strategic alternative to soybeans and corn

Although the agency had lowered its estimate for soyabean production to 49M tonnes due to prolonged drought conditions that persisted throughout January, the sector showed signs of recovery the Foreign Agricultural Service (FAS) 11 March report said.

Sunflowerseed and peanut production at 4M tonnes and 1.605M tonnes respectively remained strong, according to the FAS’s “Argentina: Oilseeds and Products Update”.

Increased exports were expected in the coming months due to the government’s temporary export tax cuts on soyabeans, soyabean products, sunflower and peanuts – introduced on 27 January and in place until 30 June 2025. The cut was made in a bid to stimulate exports and increase foreign exchange reserves for the Central Bank, the agency said.

China remains Argentina’s top soyabean buyer, accounting for 85% of total whole soyabean exports, according to the report.

However, China’s imports from Argentina had slowed significantly in the period prior to the report and were expected to remain low in the coming months as China sourced from other suppliers.

“China’s continued large imports of whole soyabeans from Argentina is in part driven by its desire to diversify its markets to source soyabeans,” the USDA said.

Paraguay and Uruguay remain the primary suppliers of soyabeans to Argentina’s crushing industry, taking advantage of the country’s processing capacity and temporary import regime, according to the report.

In 2023/24, crushing volumes were high with soyabean meal exports revised up to 29.5M tonnes, sunflower oil exports reaching a 16-year high and peanut exports exceeding 1M tonnes.

The agency lowered its 2024/25 estimate for soyabean exports by 300,000 tonnes due to a lower production forecast.

Soyabeans and soyabean-derived products remain Argentina’s top agricultural exports, with soyabean meal leading at 11.3% of total shipments, according to the report.

Argentina’s exports of the soyabeans complex – including soyabeans, soyabean meal and soyabean oil – totalled US$19.05bn in 2024, an increase of 42% compared to the previous year despite lower global prices, the report said.

The increase was driven by higher shipments of soyabean meal and soyabean oil, according to the report.

While exports of unprocessed soyabeans and biodiesel declined, the growth in processed products compensated.

“Argentina’s higher soyabean imports continue and are expected to remain high in the coming marketing year and beyond, sourced almost entirely from neighbouring Paraguay under the country’s temporary import regime, which enables agro-exporters to process foreign soyabeans in Argentina’s large crushing facilities to operate at higher capacity and for longer portions of the marketing year,” the USDA said.

“Looking ahead, the potential extension of export tax cuts beyond June 2025 could play a crucial role in influencing farmer sales and boosting competitiveness in global markets despite disappointing sales to date following the lower export taxes.”

Sunflowerseed continues to gain traction as a strategic alternative to soyabeans and corn, particularly in Argentina’s core agricultural regions in southern Córdoba and central and northern Buenos Aires provinces, according to the report.

“The shift is largely attributed to sunflower’s resilience against drought and pests… In some areas sunflower has higher profitability driving the increased interest with input costs that are lower than soyabeans, while its higher market price ensures better margins and financial certainty as soyabean prices remain low,” the USDA said.

Sunflower oil exports reached historic levels in 2024 at 1.2M tonnes, a 17% increase compared to the previous year and the highest volume in 16 years.

“This surge in exports was driven by Argentina’s competitive pricing in global markets and stronger global demand,” the USDA said.

“Looking ahead to 2024/25, export commitments are off to a strong start, with nearly 75,000 tonnes of sunflower oil products already contracted in the new marketing year, the highest volume in three years.”

Tags: soybean oil, soybean, sunseed, soybean meal, Argentina, sunflower oil