Six in Ten Dollars: Argentina's Record Harvest and What It Means for Dutch & European Food Chains

The macroeconomic context

President Milei took office in December 2023 with a mandate to dismantle Argentina's decades‑long model of economic protectionism, fiscal dominance and monetary financing. The Milei government's macroeconomic stabilization program has, after two years, delivered a unified exchange rate, fiscal consolidation, and a sharp decline in inflation from its peak of 289% in late 2023.

These reforms form the direct backdrop to the 2025 agricultural performance. A unified exchange rate meant Argentine farmers received the full peso value of their dollar export revenues for the first time in years, removing a principal disincentive to sell. Without that policy change, the record volume story would have looked considerably different.

A record built on tons, not prices*

To understand why 2025 was remarkable, you need to understand what usually drives Argentina's agricultural revenues: price spikes, not structural gains. In 2021 and 2022, global food prices soared. Russia's invasion of Ukraine sent wheat and sunflower markets into a frenzy. Argentina's export earnings jumped, not because more was being produced, but because every ton was worth more.

2025 was structurally different. Prices were down. BCR analysis shows that export prices across the basket declined by an average of 0.6%, continuing a three-year correction from the 2022 peaks. What drove revenues up was a 12% increase in quantities: more tons planted, harvested and shipped. That is a production story, not a price story. It reflects genuine productive capacity, not favorable market timing.

Two factors explain the volume increase. First, recovery from the 2022/23 La Niña drought, the worst Argentina had experienced in six decades, which collapsed soybean production from a typical range of 45 to 55 million tons down to just 25 million tons in a single season, dragging the entire sector's earnings sharply lower. 2024 began the recovery; 2025 completed it. The second is policy: the Argentine government significantly reduced export taxes on several commodities, giving farmers a direct financial incentive to plant more and to sell stored grain rather than hold it as an inflation hedge.

An important caveat applies to this picture. Part of the 2025 record is a rebound from an abnormally low base. La Niña events recur with roughly 30 to 40% probability in any two-year window. The 2025 volume should not be treated as a permanent new floor — it is a strong year within a structurally volatile range. Any supply chain planning that assumes 2025 conditions will persist risks systematically overestimating Argentine supply reliability.

Beyond soy and maize: the breadth of the harvest

Soy and maize dominate the export value tables, and they attract most of the analytical attention. But one of the more important structural changes in Argentine agriculture over the past five years is the broadening of the export basket — and 2025 made that trend visible in the data in ways that earlier years did not.

The soybean complex alone generated USD 20.9 billion: 41% of total agro-industrial exports. Beef jumped 27% to USD 4.3 billion. Wheat surged 34%. Sunflower grew 50%. Rapeseed — a crop most Argentines barely discussed five years ago, grew by 127%. Even rice, a sector that had struggled for years, rebounded 78%.

The headline number from Argentina's Secretariat of Agriculture is unambiguous: 115.41 million tons, +12% year-on-year, record absolute volume. The Bolsa de Comercio de Rosario, whose economists track these flows as carefully as any institution in the world, describes it as the third-highest nominal total since records began; achieved against a headwind of falling commodity prices. That is a volume story, driven by genuine productive improvement, not a windfall.

The 2025 numbers confirm something that gets lost in the noise of Argentina's recurring economic crises: the country's agricultural productive capacity is world-class, and when policy conditions allow it to function, it delivers.

Argentina now sells agricultural products to 143 destinations — 75% of all countries on Earth. It is the world's leading exporter of soy meal, soy oil, blanched peanuts and lemon juice. It ranks second in soy products and yerba mate, third in maize. The diversity of that positioning — across grains, oilseeds, fruit, protein, beverages and fisheries — is a structural strength that tends to get lost when the analysis focuses exclusively on the bulk commodity value tables.

That said, it is worth naming an underlying reality directly. Argentina's export basket, for all its breadth, remains overwhelmingly oriented toward raw and semi-processed commodities. Of the USD 52 billion in agro-industrial exports, the large majority leaves the country in bulk form: whole soy beans, unprocessed maize grain, raw peanuts, fresh beef quarters, unrefined sunflower oil. The value-addition — crushing, fractionating, refining, milling, packaging, branding — largely happens elsewhere. Rotterdam crushes much of the soy; around 65% of the soy that enters the Dutch system is ultimately re-exported, either directly or after processing (CBS/Profundo analysis). Antwerp handles much of the peanut blanching. Hamburg mills a significant share of the wheat.

This is not a new dynamic, and it is not necessarily a failure; it reflects comparative advantages in logistics, industrial infrastructure and proximity to end markets that have developed over decades. But whether it changes is one of the more interesting open questions the EU-Mercosur agreement raises. For the first time, the new trade framework creates a structural incentive for value-addition in Argentina: as the trade agreement  reduces export taxes on processed products alongside raw ones, the economics of processing domestically begin to improve. Argentine government industrial policy, through free trade zone incentives and agri-processing investment credit,  points in the same direction. The transition, if it happens, will take a decade. But the direction is set. That is a development worth tracking, and it creates a specific opportunity for Dutch food technology and processing equipment companies willing to position early.

Where it goes: destinations and the EU picture

Asia remains the dominant destination for Argentine agricultural exports by volume: China, Vietnam, India and Malaysia collectively absorb the largest share through demand for soy meal, maize and sunflower products as feed and food ingredients. The European Union accounted for 9.7% of Argentine export value in 2025, the third-largest destination bloc. Within the EU, the Netherlands and Spain are the primary entry points, driven by port infrastructure rather than domestic consumption patterns. This leads directly to the most important analytical point in any assessment of the Dutch-Argentine trade relationship.

What the bilateral figures actually mean: three valid answers

Argentina recorded a bilateral trade surplus with the Netherlands of USD 1.609 billion in 2025, ranking it fifth among Argentina's largest bilateral surpluses globally. That figure appears in most reporting on the relationship. It requires careful interpretation.

Argentina's statistics institute INDEC records as "exports to the Netherlands" every shipment that leaves an Argentine port with Rotterdam as its declared destination — including goods that never stay in the Netherlands at all. They arrive in Rotterdam, pass briefly through Dutch commercial hands, and continue to Hamburg, Antwerp, Lyon or London. This is the Rotterdam Effect: a well-documented feature of European commodity trade statistics that inflates bilateral numbers while obscuring the true final markets.

SEO Amsterdam Economics, in a study commissioned directly by the Dutch Ministry of Foreign Affairs and published in July 2025, quantified the effect: 46% of Dutch goods imports from Argentina are re-exported to other EU countries.

The practical implication is pointed: the Netherlands is not primarily Argentina's European customer — it is Argentina's European gateway. That is a structurally different relationship, and it calls for a different policy framing. The question is not how to balance the trade — it already is, once the transit is accounted for. The question is how to deepen the mutual benefit from that gateway role, and how the EU-Mercosur agreement changes the economics of doing so.

The climate variable: building honest projections

Any analysis of Argentine agricultural supply must reckon seriously with the ENSO cycle: El Niño/Southern Oscillation; and its impact on rainfall patterns in the Pampas, Argentina's core production zones. The mechanism is well understood: La Niña events bring below-average rainfall; severe or back-to-back events can devastate yields.

The 2022/23 season is the reference point that belongs in every supply chain risk assessment. A back-to-back La Niña event (the worst Argentina had experienced in sixty years) cut soybean production by 43% in a single season, from approximately 49 million tons to 25 million tons. Rotterdam soy flows fell sharply. Dutch feed manufacturers faced a tighter supply environment. Argentina's bilateral trade surplus with the Netherlands contracted significantly. The 2025 record is partly a bounce back from that abnormally low base.

La Niña events occur with roughly 30 to 40% probability in any two-year window, according to NOAA and Argentina's national meteorological service. This is not a reason for pessimism, it is a reason for supply chain resilience: buffer stocks timed to the harvest cycle, diversified sourcing across southern hemisphere origins, and engagement with breeding programs developing drought-tolerant variety genetics for the Pampas. Climate variability in Argentina is a known, quantifiable and manageable risk. What it should not be is a surprise.

The 2025/26 campaign and 2026 outlook

The Bolsa de Comercio de Rosario projects maize production for 2025/26 at around 62 million tons: a potential record, driven by a 17% expansion in sown area as farmers rotated back toward maize after two soy-heavy years. For soybeans, the Ministry of Agriculture, Livestock and Fisheries projects 47–50 million tons on a slightly reduced area, with solid processing margins expected to sustain crusher demand through the season.

The strategic opening on maize deserves specific mention. In April 2026, Argentina completed its first maize shipment to China, reopening a market that had been closed by phytosanitary restrictions for several years. If sustained, this adds a major new demand channel for what is already a record-sized crop, and it reinforces a broader trend of Argentine market diversification that reduces the country's dependence on any single bilateral relationship.

The key risk factors for 2026 are well-defined. Global commodity prices face downward pressure from a supply glut: record US maize output and near-record Brazilian soy production keep margins tight. The US tariff environment introduces further uncertainty into Asian commodity demand. And the EU Deforestation Regulation, entering force in late 2026, creates a genuine near-term compliance challenge: Argentine soy and beef will need to demonstrate deforestation-free origin at farm level to maintain access to EU markets, and the traceability infrastructure required for that is not yet fully operational at scale.

One structural note that is easy to miss in a year of record agricultural performance: Argentina's government is explicitly pursuing a strategy of economic diversification that, if successful, will gradually reduce the outsized share that agriculture holds in national export revenues. In 2025, 58.6% of Argentine goods exports came from the agro-industrial sector. That figure reflects decades in which other sectors were held back by overvalued exchange rates, capital controls, and the fiscal structure that treated agricultural export taxes as a primary revenue source.

That is changing. The lithium and copper mining sector, centred on the "Lithium Triangle" provinces of Jujuy, Salta and Catamarca, is attracting significant foreign investment and is projected to grow sharply over the coming decade. Vaca Muerta, the shale oil and gas formation in Patagonia, has made Argentina a net energy exporter again, with oil production reaching 500,000 barrels per day in 2025 for the first time. The technology and knowledge services sector, which developed partly as a response to domestic economic instability, generated approximately USD 7.1 billion in export revenues in 2024 — up 18% on the year prior.. These are not marginal developments. They represent a genuine structural broadening of the Argentine export economy.

For agriculture, the implication is counterintuitive but significant. If Argentina's fiscal base broadens through mining royalties, energy export taxes and services sector growth, the political pressure to maintain high agricultural export taxes as a primary revenue source gradually diminishes. This creates the policy space that the EU-Mercosur agreement requires Argentina to use: reducing those taxes on schedule, as agreed under the trade agreement. The diversification story and the agricultural opportunity story are, in this sense, deeply connected.

The question is whether the institutional momentum of 2025 and 2026 is sustained through the medium term or whether it follows the pattern of previous reform episodes that ran out of political will before reaching their structural objectives.

The production story is strong. The bilateral relationship with the Netherlands, properly understood, is more balanced and more complementary than the headline surplus figure suggests. The 2026 outlook is positive but conditional on weather, on global prices, on EUDR compliance readiness, and on whether Argentina's economic diversification strategy continues to generate the fiscal space that makes sustained reform possible.

What the EU-Mercosur agreement changes for Dutch companies and investors operating in the Argentine agri-food sector is the subject of the next article.

More information

Would you like to know more about the work done by the LVVN Office in Argentina and the ongoing projects the LAN Cono Sur team is involved in? You can visit the country page of Argentina. You can also send an email to the LAN team in Buenos Aires: bue-lvvn@minbuza.nl.