Good news for Milei: Argentine agro-industry projects new record for 2027

Good news for Argentine President Javier Milei is emerging as early projections from the country's agricultural sector indicate a record-breaking grain production for 2027. The Buenos Aires Grain Exchange, a prominent trade association for the Argentine agricultural industry, predicts a production of 158 million tonnes, marking a 0.5% increase from the 157 million tonnes produced in 2026.

This surge in output is expected to drive a 6% rise in economic activity within the agro-industrial sector, reaching US$54 billion. Exports are also anticipated to climb to US$41 billion, a 6.9% increase from the previous cycle.

General manager Ramiro Costa of the agricultural chamber emphasized that these figures represent potential projections, contingent upon weather conditions and production decisions in the coming months. Despite the mining and oil and gas sectors experiencing strong growth recently, both in terms of output and exports, the agricultural industry remains the primary source of foreign exchange for the Argentine economy.

Between January and August 2026, primary agricultural products and manufactured goods generated nearly 50% of Argentina's US$67 billion in exports.

Positive developments for the upcoming 2027 crop year include the reduction in agricultural export duties implemented by the government. President Milei announced tax cuts for wheat and barley in May 2026, lowering the rates from 7.5% to 5.5%. Soybean producers face a gradual reduction starting in January 2027, continuing through 2028, contingent on revenue trends.

Ricardo Marra, president of the agricultural chamber, praised the progressive reduction of export duty taxes as essential for improving producer profits and creating incentives for innovation and export. However, he also cautioned that competitiveness extends beyond the ranch gate, highlighting infrastructure improvements, market access expansion, and international integration as crucial challenges to overcome in order to increase production and exports over the next decade.

Comparatively, Argentina's agricultural sector competes with Brazil in the Mercosur regional market. Currently, Mercosur exports US$197 billion worth of food annually, with Brazil leading as the world's largest exporter, followed by Argentina in third place. Mercosur also holds significant shares in global soybean and corn exports, accounting for 59% and 36%, respectively.

Projections for the bloc anticipate growth in cereal and oilseed production, increasing from almost 535 to 591 million tonnes (18.7% growth), along with a rise in planted area by 9.6% and exports by 18.1%. Corn production is expected to lead in volume growth, with an additional 52 million tonnes, 64% of which would be produced by Brazil, followed by soybeans (34 million tonnes, 75% from Brazil) and wheat (5.3 million tonnes, 74% from Argentina).