Argentine growers could gather bumper soy and corn harvests next season as forecasts for wetter weather bring hope to drought-hit farms, Reuters cited a senior U.S. Department of Agriculture official as saying on Wednesday. Dryness from the La Nina phenomenon walloped the Pampas farm belt in December and January, reducing yields and slowing supply from the world's No. 3 soybean exporter and No. 2 corn provider. On top of that, some growers have had to suspend harvesting after uncommonly heavy May rains caused flooding. The extreme weather swings have prompted a raft of 2011-12 harvest forecast cuts for a country being counted on to help meet rapidly rising global food demand. But the 2012-13 season, which starts with October and November soy and corn plantings, looks promising, Melinda Sallyards, agricultural counselor at the U.S. Embassy in Buenos Aires, told the Reuters Latin America Investment Summit. Forecasters see ample rains late this year due to the El Nino phenomenon, just in time to support 2012-13 sowing. Caused by a warming of the tropical Pacific Ocean, El Nino tends to bring rains to South America, while La Nina, caused by a cooling of those same waters, tends to squeeze off rainfall. Steady precipitation would bolster the agriculture sector and increase export tax revenue at a time when Argentina's economy is slowing under the weight of Europe's financial troubles and slackening demand from No. 1 trade partner Brazil. So not only export companies that operate in Argentina, such as Cargill, Bunge and Noble Group, are interested in the crop outlook, but the international financial markets are as well. -- SPA
