Amid heavy drought losses, the Central Bank had to sell $42 million

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Exchange losses due to drought could reach $20 billion this yearwhich jeopardizes the accumulation of reserves by the Central Bank and also impacts on the negotiations with the Monetary Fund to recalibrate the objectives of the agreement.

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This Monday the Central Bank had to go out and sell foreign currency heavily to meet the needs of the market. In one wheel they went 42 million dollars. Thus, the losses so far in March have already been met 77 million dollars.

Calculations by CREA’s Agriculture Area technical team indicate that Argentina is on track to lose more than 20 billion dollars by the fatal combination of drought and frost.

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Based on the persistent drought until March, CREA recalculates the volume of the year’s harvest. A volume of 31.1 million tons of soybeans and 38.6 million tons of corn is now expected, “figures that could possibly be revised downwards in the coming weeks,” they warn.

The shortage of dollars for the plant is compounded because Added to the drought is the side effect of soybean 2 dollar, which in December anticipated sales that would otherwise have taken place in January and February,

While the liquidation of CIARA/CEC exports arrived in the first two months of 2022 US$4.940 million currentin the same period of 2023 the collection of foreign exchange through this channel was reduced to US$ 1,570 million, a decrease of nearly US$3,400 million, attributable to the change in seasonality that triggered the “soy dollar”.

Thus the drought extended to the coffers of the Central and forced to recalculate the objectives of the agreement agreed with the IMF. It was predicted that March would end with net reserves of $7.7 billion, but the truth is today reserves hover around 4.5 billion dollars.

So far this year, the Central Bank lost 1,250 million dollars in helping the market and in preventing the price of the official dollar from skyrocketing. Throughout the month of February, the central low put the dollar at a low, which rose by 5%, below the month’s inflation, estimated at more than 6%. In parallel, the blue dollar fell by two pesos on Monday and closed at its level $372, while the MEP dollar fell to $362 and cash with liquids remained at $372, on par with the informal dollar.

So, so far this year, the official dollar rose by 12.5%, while inflation promises to close the first quarter at 20%.

Lack of inputs

At the same time, the government proceeds to the release of dollars and revokes authorizations for importers to enter goods.

Next Wednesday, Minister Sergio Massa plans to meet with a group of industrialists from Córdoba, said Gustavo del Boca, president of that province’s Chamber of Metallurgical Industrialists clarion which despite the promises continue to have difficulty importing inputs.

“In the inputs to produce the problems continue to persist. Nothing has improved. Last week’s power outage was largely due to lack of maintenance due to lack of supplies. Next Wednesday we will have a meeting with Massa to evaluate the alternatives so that the industry can continue to produce”.

“For now we continue to produce because we solve problems day after day. But what we need is to have predictability. We must prioritize production and employment. The country cannot be resolved with subsidies, but with work”, said the Cordovan leader.

The lack of inputs is affecting industry in general, which in December 2022, the latest official figure, had a drop of 1.2% compared to November.

AQ

Source: Clarin

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