The field is responsible for almost a quarter of the total diesel
consumption in our country and biofuels provide not only foreign
currency but also help to increase the supply of naphtha and diesel
that Argentina's automotive sector and the agricultural and livestock
Five indicators show that the Argentine field and agroindustry sectors are
true engines of fuel consumption and production, generating foreign
exchange with their exports. The Argentine agricultural sector is
responsible for 22% of the total diesel consumption of our country, about
4,300 million dollars. The production of grains in Argentina and their
transportation are responsible for 12% of country’s diesel consumption,
which is around 2,300 million dollars. 9% of the diesel used by the field
and the automotive fleet in Argentina is Biodiesel and almost 12% of the
naphtha consumed by the automotive fleet is bioethanol based on corn and
sugarcane. Furthermore, biofuels collaborate with the Argentine trade
balance: in 2016, biodiesel contributed 2% of the foreign currency that
entered in Argentina for exports and 6% of what the oil industry exported
–which is the main exporting complex in Argentina- in that year was
Indicator N° 1: Argentine agricultural sector is responsible for 22% of
the total diesel consumption of the country, about 4,300 million
According to estimates of the Rosario Board of Trade, the diesel
consumption Argentina for the 2016/2017 grain campaign would have amounted
to around 2,032 million liters. These estimates refer only to the
production and transportation of the following grains: soybeans, corn,
sunflower, sorghum, rice, peanuts, wheat, oats, rye, barley, canary seed,
safflower, rapeseed, flax, forage barley and wheat. If we add to this
figure the rest of the agricultural-livestock activities and all the
regional economies (such as the production of lemons, afforestation,
fruits, vegetables, cotton, rice, pastures, also considering maintenance of
roads and electric generators) diesel consumption would approach 3,800
million liters per campaign. This last number was estimated by the
Argentine Rural Society through its Institute of Economic Studies and
As the diesel consumption in Argentina in 2017 would have approached 16,850
million liters (estimated by the United States Department of Agriculture -
USDA), this total fuel consumption of the Argentine agricultural sector of
3,800 million liters per year represents 22% of the total diesel
consumption of the country. If we value this consumption for the current
price of diesel (AR$ 21.47 per liter) and the exchange rate of January 16,
we are talking about a total turnover of 4,300 million US dollars.
These are impressive figures and show the relevance of the field as a fuel
demander and the remarkable contribution it makes to the revenues and
profitability of the oil companies operating in the country.
Indicator N° 2: The production of grains in Argentina and their
transportation are responsible for 12% of diesel consumption in the
country, around 2,300 million dollars.
In the July 7, 2017 BCR weekly newsletter we made the aforementioned
estimate of diesel consumption in Argentina for the 2016/2017 grain
campaign. With a production of almost 125 million tons of grains, the
estimated diesel consumption’s value was 2,032 million liters. Since the
total consumption of diesel oil in Argentina in the year 2017 would have
been of 16,850 million liters (USDA), the fuel consumption for the grains’
production and transport of the 2016/2017 cycle would have represented 12%
of the total gasoil consumption, which is a significant value.
It’s important to consider that this indicator takes into account the
consumption of diesel in both the agricultural production process and in
the mobilization of grain throughout the campaign. These 2,032 million
liters involve in the middle of January 2017 about AR$ 43,600 million for
the use of this fuel, approximately about 2,300 million US dollars.
In the July 2017 report we saw the following information for the 2016/2017
a) The diesel consumption, within agricultural holdings and regarding the
grains productive process, would have been calculated in the 2016/2017
campaign close to 903 million liters.
b) The fuel consumption required by the transport of the main cereals and
oilseeds to ports and factories, both by truck and by rail, would have been
near 1,130 million liters of diesel.
Table No. 1 shows the growth in the diesel consumption for the grains
production and transportation process due to the elimination/reduction of
quantitative restrictions on exports at the end of the year 2015. The
greater sowing of corn, wheat and sunflower have generated a bigger
consumption of diesel for these crops. If we compare the 2016/2017 cycle
with the 2014/2015 cycle (before the elimination/reduction of quantitative
restrictions on exports), it can be seen that the diesel consumption for
the grains production grows by 10%, while the diesel consumption at a
national level (according to USDA data) grows 6%. This means there are
almost 200 million liters of additional diesel fuel consumed due to the
increase in the planting area and in the transported volumes of these
Indicator N° 3: 9% of diesel consumed by the field and the automotive
fleet in Argentina is Biodiesel.
USDA estimates that diesel consumption in Argentina that would have been
made by the vehicle fleet and the field -in its diverse productive
activities- in 2017 would have been 13,660 million liters. There is an
important national production of biodiesel that is affected by the
obligatory gasoil cut in the domestic market, obtaining the fuel that is
usually used by automobiles, light and heavy commercial vehicles and
agricultural/livestock activities. The biodiesel production affected by the
cut would have been 1,240 million liters in that year.
By relating these two concepts, we see that 9% of the diesel consumed by
the field and the automotive fleet in Argentina is Biodiesel. It’s
interesting to recall that 10 years ago this didn’t occur in Argentina,
since the huge biodiesel factories that the country has today didn’t exist
by then. Today Argentina has 37 plants (some of the largest in the world
are located in the Rosario’s influence zone) with a theoretical production
capacity of 5,400 million liters. This capacity was multiplied by 8 in just
Regarding the Argentine automotive fleet that consumes biodiesel mixed with
diesel oil, according to data from the Argentine Association of Components
(AFAC in spanish) the total fleet circulating in Argentina amounts 12.5
million vehicles. Of this total, 35.8% works with diesel fuel:
approximately 4,475,000 vehicles. The main refineries that mix this fuel
are: Axion Energy Argentina S.A., YPF S.A., Shell Argentina CAPSA,
Petrobras Argentina S.A. and Oil Combustibles S.A.
Indicator N° 4: Almost 12% of the naphtha consumed annually by the
automotive fleet in Argentina is bioethanol based on corn and
In previous weekly news editions we saw that the corn-based Bioethanol
industry has had an important growth in Argentina since 2012. This industry
began to grow as a consequence of the mandatory cutting of gasoline with
ethanol provided by the National Government. Currently, five companies that
obtain corn-based ethanol operate in our country. On the other hand, there
are 10 important factories that obtain ethanol processing sugar cane: six
of them are located in the province of Tucumán, 2 in Salta and 2 in Jujuy.
The production capacity of these 10 plants that use sugarcane is around
482,850 m3 / year. This implies that Argentina has a total production
capacity -with its 15 main factories- of 997,350 m3 / year of ethanol.
The Argentine naphta consumption in the year 2017 would have been of 8,700
million liters. The national production of ethanol that is affected by the
mandatory cut with naphtha in the domestic market would have amounted 1,040
million liters in the year 2017. Consequently, 12% of the naphtha annually
consumed by the automotive fleet in Argentina is bioethanol, either based
on corn or sugarcane.
The Association of Argentine Factories of Components (AFAC in spanish) has
estimated that 49% of the circulating vehicle fleet in Argentina - which
amounts 12.5 million vehicles - uses naphtha as fuel. As a result, about
6,125,000 motor vehicles work with this fuel and consume either sugarcane
or corn based ethanol.
Indicator N° 5: In 2016, biodiesel contributed 2% of the currencies
that entered in Argentina for exports. In turn, 6% of what the oil
industry exported –which is the Argentine main exporting complex- in
2016 was biodiesel.
In 2016, Argentina’s income of foreign currency for total exports amounted
57,737 million dollars. Biodiesel shipments contributed with 1,175 million
dollars, which represented 2% of the total Argentine exports. It is a
significant contribution considering it is a very recent industrial
complex, as we saw earlier.