Argentine agriculture is undergoing a complex transformation. Despite a challenging policy environment, the enthusiasm of younger growers for new technologies is injecting significant vitality into the nation's agricultural future. Rafael Obligado, Head of Kynetec Subscription Markets, shared his insights into the key trends shaping the Argentine agricultural market in 2025.

Policy Shifts and Market Dynamics:

The Argentine government recently reduced export taxes on major agricultural products (soybeans from 33% to 26%, corn and wheat from 12% to 9.5%) and permanently eliminated taxes on regional products, aiming to boost agricultural competitiveness. However, a mid-season presidential policy revision diluted the tax reduction's impact, exposing the country's underlying issue of policy volatility. This uncertainty elevates the risk of high-cost agricultural activities, hindering the adoption of innovative, investment-heavy technologies.

At the farm level, this instability is driving behavioral shifts. The traditional practice of large-volume, upfront purchases at the start of the season is being replaced by fragmented, small-scale, strategic procurements throughout the year. The previous strategy of stockpiling against currency devaluation is no longer relevant in today's stable exchange rate environment. Furthermore, agrochemical supply is abundant, allowing growers to procure opportunistically based on favorable pricing, bartering for inputs with grain, or leveraging seller-financed investment costs. This cautious approach reflects both economic pressure and the fundamental challenge of conducting business in Argentina: a lack of predictability.

Challenges in Agrochemical and Seed Sales:

In 2023, farmers hoarded agrochemicals fearing currency devaluation, leading to an oversupply in 2024 and a consequent 30% year-on-year drop in agrochemical sales. Additionally, increasing weed resistance to species like Amaranthus, Digitaria insularis, Echinochloa colona, Conyza, Chloris, and Lolium is significantly impacting seed and agrochemical sales.

The industry also faces fierce competition from low-cost generic manufacturers in countries like China and India. In this environment of tightening margins, only distributors offering robust logistics and technical support can maintain competitiveness.

Fungal Diseases and Precision Application:

Fungal diseases continue to affect major crops, though typically localized and seasonal. Their impact is being controlled through increasingly precise methods. The true innovation lies in application techniques: new technologies such as drones are transforming spraying strategies. Since late 2024, Argentina's National Agri-Food Health and Quality Service (SENASA) has approved regulations for drone aerial spraying, and product labels have been updated with specific dosages and application methods.

Market Forecast for the Coming Year:

The agrochemical market is projected to contract slightly by 3-5% in the 2025/26 season, though product volumes may remain stable or see a marginal increase. Price competition will remain intense due to high import volumes and accumulated inventory. However, if global producers adjust their supply chains, shortages of certain ingredients could emerge.

The adoption of biologicals continues to grow, and precision agriculture products like drones and data apps are advancing, albeit unevenly. Policy announcements indicate a longer-term shift towards market liberalization and tax reductions, laying the groundwork for future investment and technological adoption.

Adoption of Precision Agriculture in the Local Market:

Digital adoption is theoretically high but practically uneven. An INTA report shows that 92% of growers use digital tools: 60% combine apps and platforms, 17% use only apps, and 10% use only platforms. However, 67% experience poor or unstable internet connectivity, limiting data analysis and real-time decision-making capabilities.

Drone spraying has emerged as a prominent innovation: imports of agricultural drones grew from just 90 units in 2023 to 600 in 2024, with projections reaching 2000 by the end of 2025. During the rainy autumn of 2024, which prevented ground operations, drones effectively carried out pre-sowing weed control, reducing soil damage and promoting crop growth.

Prevalence of Biologicals in the Market:

The Argentine biologicals market continues to grow, albeit still in its early stages. The market expanded by 11% in 2024 and is expected to maintain a steady annual growth rate of 10-14%. While no clear market leader has emerged yet, both local companies and multinational corporations are actively positioning themselves. Amidst increasingly stringent regulatory and economic environments, growers are seeking cost-effective and sustainable solutions, making this sector full of potential.

Some biologicals are beginning to integrate into conventional farming practices to reduce chemical use and improve soil health. Products with biostimulant and nematicidal functions are receiving particular attention, especially in areas with soil fatigue and increasing abiotic stress. Although skepticism among older growers and a lack of field data remain adoption barriers, a shift in production philosophy is quietly occurring.

Agricultural Machinery Market Performance:

The Argentine agricultural machinery market is showing signs of recovery in 2025: Q1 sales increased by 22% year-on-year, with unit sales growing 31% to 3,628 units, significantly above the five-year average. Domestic brands continue to dominate, with imported equipment accounting for 16%. Recent government approval for used equipment imports is expected to benefit small farmers.

Sprayers (both self-propelled and trailed) lead sales, accounting for 48% of the total, followed by tractors and harvesters. Precision agriculture technology adoption is gradually increasing, but connectivity and technical training remain barriers to widespread use. After years of economic downturns and crisis-driven purchases, dealers are observing stabilizing demand, and farmers are showing increased interest in financing options linked to grain delivery or public credit programs. Durable and adaptable equipment is favored by farmers, such as no-till planters with variable application technology or sprayers that support drone integration.

Demand for service-based machinery models is surging. Contractors offering "equipment as a service" (bundling data and application technology) are expanding their share, particularly appealing to medium-sized farms looking to scale technology without direct ownership.

The current market recovery remains fragile, dependent on policy clarity and financial stability. However, the positive attitude of young growers toward technology-driven agriculture injects tangible optimism into the sector.