By Hugh Bronstein
BUENOS AIRES (Reuters) - Farm analysts living in Argentina's capital city went to sleep on Thursday soothed by the welcome sound of rainstorms, but the showers failed to relieve many of the country's drought-hit soy fields.
While the streets and wide avenues of Buenos Aires were deluged late Thursday, causing traffic jams and a breakdown in train service, some key soy producing areas remained dry after months of below-average precipitation.
Argentina supplies nearly half the world's soymeal, used for animal feed, and soyoil, used for cooking and in the booming international biofuels sector. The South American country also provides about 12 percent of soybean exports, an important source of protein for an increasingly hungry planet.
As the world population grows to an estimated 9 billion by 2050, demand for food and animal feed will nearly double, according to the United Nations. Argentina, with its vast, fertile Pampas, will be key to meeting that demand.
But the country's top three soy-producing provinces - Buenos Aires, Cordoba and Santa Fe - have been punished over the last two months by an unrelenting Southern Hemisphere summer sun.
"Soil moisture in the center of the grains belt continues to be under normal levels," said Tomas Parenti, an agronomist with the Rosario grains exchange.
That's not good news for farmers, Argentina's government and
Soy export taxes account for about 5 percent of government revenues. Grains are also an important source of dollar reserves used by authorities to make sovereign debt payments and intervene in the foreign exchange market to bolster the peso.
PATCHY RAINS SEEN
"We are expecting scattered showers over the weekend, but expectations are not high in terms of seeing an end to the effects of the drought," Parenti said.
The Buenos Aires Grains Exchange sounded more optimistic, saying late on Thursday that recent showers were stronger than expected and should help the grains belt continue to recover.
The state-run INTA agricultural institute said on Friday morning that rains of 5 to 25 millimeters moistened parts of eastern Buenos Aires province over the preceding 24 hours.
The Rosario exchange sees a 2011/12 soy harvest of 49.5 million tonnes versus 50.3 million tonnes in 2010/11. This season's estimate could fall, depending on the intensity of rains over the weeks ahead.
Argentine corn crop estimates have meanwhile been slashed from their original range of 28-30 million tonnes to under the 23 million tonnes that were harvested in 2010/11.
The country is the world's No. 2 corn exporter after the United States. The drought dashed hopes that Argentina might replenish global corn supplies after a lackluster U.S. crop.
Argentina corn has been hit harder than soy due to its shorter and more delicate flowering period. The heat of December and early January, exacerbated by dryness related to the La Nina phenomenon, baked many corn plants just as they were budding.
"Some parts of the Pampas have not benefited from this recent wave of rains and remain relatively dry," said Patrice Lannou, a cattle rancher with 600 hectares in Buenos Aires and Entre Rios provinces. "The storms have not been enough to make up the water deficit left by the drought."
(Additional reporting by Nicolas Misculin)