The latest HB4 wheat authorization moves beyond the genetically modified grain's approved use in animal feed, and comes at a time when a large swath of Argentina's most-productive farmland has been hard hit by historic drought conditions.

The authorization by the Asian country marks a milestone for GMO wheat, which was considered taboo among many consumers until just a few years ago, but has gained more acceptance due in part to concerns about food security and climate change.

Indonesia is the largest global wheat importer along with Egypt, while Argentina is one of the world's top grains suppliers.

According to a U.S. Department of Agriculture (USDA) forecast, Indonesian buyers are expected to purchase 11 million tonnes of wheat in the current 2022/2023 harvesting season.

Indonesia has become Argentina's second largest wheat importer, behind Brazil, with Argentine wheat exports to the Asian country reaching 1.34 million tonnes last year, according to official data.

The GMO authorization follows a market approval by Brazil earlier this month.

Bioceres Chief Executive Federico Trucco told Reuters last week that the company plans to increase production of its proprietary HB4 variety in Argentina, adding the company plans to mainly focus on working with "seed multipliers" to increase seed reserves.

(Reporting by Maximilian Heath; Editing by David Alire Garcia and Sandra Maler)

By Maximilian Heath