The campaigns have pressed for unity change following the announcement of the “agricultural dollar” by Economy Minister Sergio Massa on his tour of the United States, which includes both soybeans and other regional economies, with the aim of increase the reserves of the Central Bank.
As a result of the huge production losses caused by the drought, the first quarter of 2023 could end with the lowest export volume in recent years: it would not reach 3 billion dollars and would decrease by 64% on an annual basis.
“We haven’t been consulted on this issue but since a special soybean dollar has been introduced, we say the same thing: the healthy thing for our economy is to have a unified exchange rate restore the competitiveness of the sector. If this measure goes along this line, it will be positive but we don’t have the details,” said the head of the Argentine Rural Society, Nicholas Pine.
For example, added the ruralist, in the case of soybeans, withholding taxes and the exchange make the producers receive half the international value. “This is not good for producers, neither for the sector nor for the country,” he warned. Today, a producer receive 38% of the international price in apneawhich is about $540.
According to a study by the Rosario Stock Exchange, shortly after the official start of the 2022/23 soybean trade campaign, the productive sector has committed the lowest volume of soybeans since the 2001/02 campaign. 4.8 million tonnes were sold, just under half of what was sold in the campaign prior to the same date. In terms of percentage of expected production, commercialization reaches 18%, compared to 24% last year.
“It destroys the soybean market, makes noise in the leasing market and increases costs for consumers without them being able to export at a higher value,” he said. David Miazzoeconomist at the Agricultural Foundation for Development of Argentina (FADA).
“It is another proof, if any were needed, that the original problem is official exchange which is a lie, supported only on the basis of inventories and loss of reserves. The real solution is to switch to the single and true dollar,” he remarked.
The same body today released an alarming figure: the tax burden increased in March and the state withheld 79% of the income generated by an average agricultural producer of soybeans, corn, sunflower or wheat.
“We talk about the agricultural dollar, but in reality there is no universality for the agricultural sector with this dollar because it clearly says that it has a low impact on the domestic market. So they think about what can happen with wheat, corn, meat and milk “, remarked the president of Carbap, Horace Salaverri. “Will they have the same export opportunities as other products?” he wondered. “That raises questions,” she replied.
Similarly, Salaverri highlighted the soybean market, where it is already down $15-20 and could continue to decline. “In pesos you will have more but in dollars you will have less. That’s why you have to be very careful with the game”, he reacted.
“It would be contradictory. When the government passed a measure some time ago to lift the fines on exporters of wheat and corn and allow shipments to be postponed to relieve pressure on the internal market, and now they are giving double change. For the moment, the market’s position is to unseat until it clears up,” sources from the cereal brokerage sector interviewed by Clarín said in this regard.
Source: Clarin
