For the first time, the Ministry of Agriculture decided to praise a graduated price for the green leaf and the yerba canchada. As of this Monday, the benchmark for the raw material was set at 107 pesos, 52.68% more of what has been poured into the dryers since October, when the last increase was granted. It will be another increase in May and another in July, to round off 71.23% in the first half.
Instead of two increases a year (in March and September), the yerba chain is now due to inflation will have three adjustments in the first halfwhich will most likely be repeated in the second.
According to INDEC, last October the value of half a kilo of weed costs in stores $351.20, while in February (the latest official data) it had already risen to 413.83 dollars, 18% more in four months. All this with the value of the frozen raw material.
Agriculture intervention came after the National Institute of Yerba Mate (INYM) could not agree on prices which will be in effect for the gross collection period, which runs from April to October. Juan José Bahillo’s resolution approached the claims of primary producers that of the industrialists, who had wrecked the INYM negotiations by proposing to maintain last year’s price.
Following the intransigence of the millers and before the imminent award of Agriculture, the governor of Misiones Oscar Herrera Ahuad went to Buenos Aires and met with Bahillo, to whom he presented a spreadsheet with the production costs and the impact generated by the economic yerbatera of the province. Even the president had a meeting with the Secretary of Commerce, Matías Tombolini, so that the milling sector can transfer the new costs to the packaging.
The Bahillo resolution establishes that the value of the kilo of green leaf will go from 107 pesos to 112 from May 1st; and two months later he will reach 120 pesos, thus completing himself an increase of 71.23%.
In May of last year, Bahillo also had to praise the price of yerba and set reference prices of 46.89 pesos per kilo of raw material and 178.18 pesos for canchada (dry yerba, without grinding).. In October the values increased through another Agriculture resolution and stood at 70.08 pesos for green leaf and 266.30 for canchada. These amounts have been maintained until now.
With this new update, today producers should receive 107 pesos per kilogram of green leaf and 406.60 pesos for each kilogram of field. When July is reached, the values will be 120 and 456 pesos respectively.
Governor Herrera Ahuad came out to celebrate the new values. “We reached a historic award for yerba mate”, he highlighted through social networks. And by the way, she remembered it it is waiting for the approval of a differential dollar for the regional economies.
“I asked Economy Minister Sergio Massa once again for a differential gearbox that contemplates the sector forestry, tobacco, tea and yerbatero. The complex momentum of the economy, dollar prices and inflation do not favor our regional economy,” the president said.
For Herrera Ahuad it was important “to show them how a regional economy can deteriorate with a wrong decision a thousand kilometers from the province. That’s why I always work so that the price of yerba mate does not go to the offices of officials in Buenos Aires, because In those offices it is very easy for someone to queue up and they can lower the price. You know that the offices of many are in Buenos Aires, while the producer doesn’t come to Buenos Aires. The producer arrives in Buenos Aires when he is completely and utterly overwhelmed by the problem, takes a bus, leaves and protests,” he added.
Charles Arterburn is a seasoned business journalist for News Rebeat, where he provides comprehensive coverage of the latest trends and developments in the world of finance and economics.