Argentina's soy harvest progressed by a brisk 12 percentage points over the last week, the government said on Friday, propelling the agricultural powerhouse toward a record crop that has already helped drag world food prices to a near five-year low.
The world's top exporter of soymeal livestock feed expects a 59 million-tonne harvest this season, blowing past the record 53.4 million tonnes collected in the 2013/14 crop year.
Soy demand is driven by Asia, where the middle class is shifting from a diet of rice toward meal-fed beef, pork and poultry. Climbing Argentine crop estimates helped push world food prices to a near 5-year low in April.
Argentina's agriculture ministry said 72 percent of the country's soybeans had been harvested so far, up from 64 percent at the same point last year.
"The forecast indicates good weather conditions during most of the week ahead. Cool air, with warmer periods during the day, will continue in central and northern Argentina over the coming seven days," the ministry said in a report.
Soy planting has taken Argentina by storm over the last 20 years, displacing wheat and corn in many areas and raising concerns that lack of crop rotation may cause long-term damage to soils in the country's famously fertile Pampas farm belt.
Argentina slaps a 35-percent export tax on soybeans, compared with 23 percent on wheat and 20 percent on corn.
Soy is nonetheless favored by growers due to the export quota system that governs wheat and corn shipments.
Under the system, the government raises and lowers the amount of allowable export through the year, depending on crop size and domestic food demand. Growers complain the system makes crop planning difficult and hurts their profits by reducing competition among buyers.
The soy juggernaut has also been propelled by genetic technology that allows bean plants to grow in dryer areas.
"What we are seeing now is the combined impact of good crop weather and genetic technology that is increasing yields in areas that were too dry to grow soy only a few years ago," said Pablo Adreani, analyst with consultancy AgriPAC.