According to the latest weekly report from the Rosario Grain Exchange (BCR), the core agricultural regions of Argentina have officially launched the sowing of soybeans for the 2025/26 season. Although the profit prospects for soybean cultivation this season have improved significantly compared with last year, and the yield target is set to exceed 4 tons per hectare, the uncertainty of weather and the expected huge supply from neighboring Brazil still cast a shadow over farmers. At the same time, wheat in the critical grain-filling period is facing the dual threats of drought and frost, showing a distinct pattern of mixed prospects at the start of Argentina's agricultural production.

Uneven Soybean Sowing Progress: Opportunities and Caution Behind Yield Targets

As of the release of the weekly report, the core soybean-growing areas in Argentina have completed sowing an area of 200,000 hectares, accounting for 7% of the planned 3.2 million hectares. The sowing work has been steadily carried out, but there are significant regional differences in progress. This imbalance stems from farmers' cautious prediction of the weather - most farmers choose to wait for the expected rainfall before sowing on a large scale, while some regions with superior soil moisture conditions have taken the lead. Among them, the sowing progress in southeastern Córdoba Province has reached 30%, where local farmers are making full use of the existing soil moisture to plant high-yield early-sowing soybean varieties, striving to seize the opportunity for high yields.

A major highlight of this year's soybean production is the improvement in yield potential. At the beginning of sowing, 75% of the farmland in the core growing areas maintained sufficient moisture, laying a solid foundation for crop growth. Farmers generally set the average yield target at more than 4 tons per hectare, and even aim to reach 5 tons per hectare as a stretch goal. To achieve this target, farmers have shown great enthusiasm in production investment, increasing investment in high-quality seeds and fertilizers to empower high yields from the source of production.

Widening Profit Gap: Tenant Farmers Trapped in Loss Dilemma

Compared with last year, the profit prospects for soybean cultivation this season show a "recovery" trend, but this positive trend has not been evenly distributed among all farmers, and the difference in land ownership has led to a significant profit gap. For farmers with their own land, the profit from soybean cultivation this season is quite considerable: based on a yield of 4 tons per hectare, the net profit per hectare can reach 385 US dollars; if the high-yield target of 5 tons per hectare can be achieved, the net profit will further rise to 556 US dollars per hectare. The promising profit expectation has become an important driving force for farmers' active investment.

However, tenant farmers are facing a completely different situation. Affected by high land rental costs, calculated at a rental cost of 1.8 tons per hectare, even if the expected yield of 4 tons per hectare is achieved, tenant farmers will still suffer a loss of 20 US dollars per hectare. Data shows that tenant farmers need a soybean yield of at least 4.1 tons per hectare to break even, while the break-even yield for farmers with their own land is only 2.8 tons per hectare, showing a huge gap between the two groups.

In addition to land rental costs, the rising cost of weed control has further eroded farmers' profits. The situation of weed control in Argentine soybean fields is severe this season, and the cost of herbicides has accounted for 20% of the total cost of farmers with their own land, equivalent to the output value of 0.4 to 0.5 tons per hectare. Winter rainfall has led to the early growth of "red grass", and coupled with windy and rainy weather conditions that have hindered the timely spraying of herbicides, farmers have been forced to increase the control cost by an additional 20-40 US dollars per hectare, further intensifying the cost pressure.

Dual External Variables Restricting Market Confidence

Despite the positive domestic yield prospects, two major external variables still worry Argentine farmers. The first is the supply pressure from neighboring Brazil. The Brazilian government predicts that the country's soybean output will reach 178 million tons this year, and the record supply scale may continue to put downward pressure on international soybean prices. Even if Argentina achieves high yields, farmers' actual income may still shrink due to price fluctuations.

The second is the uncertainty of weather risks. Meteorological conditions show that the La Niña phenomenon may have an adverse impact on Argentina's agricultural regions in the early summer of the Southern Hemisphere. The core growing areas are expected to experience unstable weather such as showers and storms, which may not only interfere with the soybean sowing progress but also pose a threat to subsequent growth stages, adding variables to the achievement of yield targets.

Wheat Faces Critical Challenges: Dual Threats of Drought and Frost

Compared with the mixed start of soybean sowing, Argentina's wheat production is facing more severe challenges. Currently, wheat has entered the critical grain-filling period, which is extremely sensitive to moisture and temperature. However, in the past 15 days, 75% of the core growing areas have received less than 10 millimeters of rainfall. Coupled with the dual effects of high temperature and strong solar radiation, the soil moisture loss rate has accelerated, and the reservoir storage has also decreased simultaneously, seriously affecting the wheat grain-filling process.

Water shortage has been directly reflected in the crop growth. The wheat crop condition rating has been lowered by 10 percentage points, and the proportion of wheat with excellent and good ratings has now dropped to 75%. The market is in urgent need of 50-60 millimeters of effective rainfall to alleviate the drought. To make matters worse, exchange consultants have warned that a significant cold air invasion will occur in the core producing areas on October 29 (this Wednesday), with the minimum temperature possibly dropping to 0-5 degrees Celsius, posing a frost risk. For wheat in the grain-filling period, frost may cause the interruption of grain filling and poor grain development, significantly affecting the yield.

Overall, Argentina's 2025/26 agricultural production has shown a differentiated pattern at the start: soybeans have started sowing with good soil moisture and promising profit prospects, but cost pressures and external risks are hidden concerns; wheat, on the other hand, is facing the dual threats of drought and frost during the critical growth period, with an uncertain outlook. Subsequent weather changes and international market dynamics will become the core factors determining the final results of this season's agricultural production, and the market needs to continue to pay close attention.