BUENOS AIRES (Dow Jones)-- Argentine wheat conditions improved over the past
week across much of the farm belt, although the crop is suffering from drought
in the western areas, the Agriculture Secretariat said in its weekly crop
report Friday.

  In the Coronel Dorrego district of Buenos Aires Province, farmers planted 27%
less wheat area than last season. Initial expectations were for a 40% drop,
"but due to the showers in the last days, area is being increased," the
Secretariat said.

  But in the Laboulaye district of Cordoba province "conditions are
deteriorating due to the lack of water and typical August winds."

  With many fields in bad shape, the worst are being turned over to cattle
pasture, the Secretariat said.

  According to the Buenos Aires Cereals Exchange, 95% of the forecast 2.75
million hectares had been planted with wheat as of Wednesday.  Nationwide, area
is expected to be down 40.2% on the year and represents the smallest area going
to wheat in over 100 years.

  Neither the Secretariat nor the Buenos Aires exchange have forecast
production yet, but the Rosario Grain Exchange says that 2009-10 wheat
production is likely to total about 7.4 million metric tons.

  That's down from 8.7 million tons in 2008-09, and down sharply from the
average of 14.76 million tons over the previous five years.

  With domestic demand estimated at 6 million metric tons, just 1.4 million
tons of wheat is likely to be left over for export from the 2009-10 crop,
according to the Rosario Exchange.

    Sunflower Seeds


  Sunflower seed planting is just starting in the northern areas, but continued
dryness is slowing progress, the exchange said.

  Sunflower seed area is expected to be down 15% from last season, the
Secretariat said.

  The Buenos Aires exchange has forecast planting at 2.22 million hectares,
significantly higher than the 2 million hectares expected by the Rosario Grain
Exchange. The Rosario exchange forecasts production of 3.4 million tons, up
from about 3 million tons last season.

   Corn


  The first 2009-10 corn planting kicked off in Santa Fe province this week,
with 1,000 hectares seeded as of Thursday, the Secretariat said.

  The 2008-09 corn harvest done, with the Buenos Aires exchange pegging
commercial corn production at just 12.5 million tons. The crop was the smallest
in over a decade due to extensive drought damage.

  Meanwhile, corn area during the 2009-10 season is likely to fall sharply,
according to the Rosario exchange.

  Area is unlikely to be over 2.3 million hectares, with 2009-10 production at
about 16 million tons, according to the Rosario exchange.

  Half of that amount will likely be set aside by the government for domestic
demand, leaving just 8 million tons available for export, according to the
Rosario exchange.

   Soybeans


  Soybean production is expected to rise sharply again next season.

  Soy planting is likely to surge to between 19 million and 20 million hectares
during the 2009-10 season, Buenos Aires exchange chief climatologist Eduardo
Sierra said in a recent interview. That would shatter the record set during the
2008-09 season, when farmers seeded 16.6 million hectares with the oilseed.

  The Rosario exchange forecasts 2009-10 soy planting of 18.5 million hectares,
with production of 50 million tons.

  In addition to weather factors, the fact that soybeans are the only major
crop in which the government doesn't control exports is spurring farmers to
plant more of the oilseed. Argentina limits the export of wheat and corn to
ensure domestic supply and keep down local prices.


  Estimates for Argentina's 2009-10 crop production in millions of hectares
(HA) or millions of metric tons (MT).

                     Wheat    Soy      Corn        Sunseed
   Rosario Exchange  7.4MT    50MT      16MT        3.4MT
   B.A. Cereals Exch 2.75HA   --        --          2.22HA
   USDA              9.5MT    51MT      15MT        4MT


  Estimates for Argentina's 2008-09 crop production in millions of hectares
(HA) or millions of metric tons (MT).

                     Wheat    Soy       Corn        Sunseed
   B.A. Cereals Exch 8.7MT    32MT      12.5MT      3MT
   USDA              8.4MT    32MT      13MT        2.9MT
   Agriculture Sec't *        *         *           *


  *The Secretariat has not published its forecast since February - the March
report was revoked.


  Argentina's historical production estimates in millions of metric tons,
according to the Agriculture Secretariat:

                     Wheat     Soy      Corn      Sunseed
 2007-08             16        46.2     20.5      4.65
 2006-07             14.6      47.5     21.8      3.5
 2005-06             12.6      40.5     14.5      3.8
 2004-05             16        38.3     20.5      3.7
 2003-04             14.6      31.6     15        3.1