BRAZIL EXPECTED TO BUY MORE ARGENTINE WHEAT

BRAZIL EXPECTED TO BUY MORE ARGENTINE WHEAT

Argentine government analysts and private traders said Brazil's 1993-94 (December-November) marketing year wheat imports will rise 7.1 percent to 16.6 percent from a year ago, due to a declining crop and rising domestic consumption.

They pegged Brazil's import needs at between 4.5 and 4.9 million metric tons, up from a projected 4.2 million in 1992-93. July frost damage will reduce Brazil's wheat harvest to a maximum 2.2 million tons in 1993-94 (May- April), Agriculture Secretariat analysts said, down 26.1 percent from 2.775 million a year ago.Trade houses have made similar wheat supply-demand estimates for Brazil, although several private exporters forecast the 1993-94 harvest will reach only 2.0 million tons.

Argentine farmers cover about 75 percent of Brazilian imports. However, quality concerns and a small harvest will limit Argentine exports in 1993-94, traders said.

Traders here said Argentine wheat quality and yields will be mediocre at best, and possibly poor in southern Buenos Aires and central Cordoba provinces because of unfavorable growing conditions in September-October.

The millers have periodically complained about uneven quality of Argentine wheat this decade, and the criticism is valid, said Horacio Goyeneche, an Argentine Industrial Millers Federation executive.

He said part of the problem has been that economically hard-pressed Argentine farmers are unable to invest in wheat with higher gluten and protein content. More often, poor handling and storage at inland and dockside elevators have caused wheat to deteriorate.

The strong economic incentive of preferential local tariffs leads Brazilian millers to import from Argentina. It gives farmers here a price advantage over wheat from Canada, the European Community and the United States.