If the expectations of the Ministry of Economy are met, the third edition of the soybean dollar could contribute 9,000 million dollars in the coming months. Although the measure will give air to a government suffocated by drought and lack of foreign currency, this new rabbit that Sergio Massa takes out of the galley it would not be enough to make them close their accounts with the IMF.
With 3 soybean dollar, between April 10 and May 31, the government will recognize them a dollar of $300 exporters liquidating their oilseed sales during that period. Therefore, they will receive about 90 pesos more than the current wholesale dollar price.
With this they try to convince exporters to go out and liquidate and that this puts an end – or at least establishes a pause – in the series of sales that Centrale has accumulated and which led it to separate $3,396 million in the Single Free Foreign Exchange Market (MULC) so far this year.
If we add to this the foreign currency used to pay off debts, the Central has already lost net reserves by US$5.860 million, according to the calculation of the Equilibra consultant. This led to the renegotiation of the net reserve accumulation objectives established in the agreement with the Monetary Fund, so that the country would not fall into a breach that would prevent subsequent disbursements by the institution.
From GMA Capital they specify that “the IMF was accommodating and eased its March net reserve target by $3.6 billion. In any case, Argentina violated it. So that this doesn’t happen again, You have to add reservations. For this reason, Massa announced a new $300 agro dollar program.
The question that runs through the market is whether it will come with this rabbit to get to the goal. For now, expectations are not good.
Now that the IMF has already moved on with its first quarter targets, all eyes are on its second quarter targets: the stock of reserves for the end of June is expected to reach US$ 9,077 million. At the end of March, they stood at $2.1 billionso you need to add another 7,000 million US dollars in the next three months.
From the consulting firm Equilibra they underline that they should be satisfied with this new program US$7,000 million worth of soybeans during the 45 days duration of the incentive, e US$1,900 million in exports from regional economies over the next 5 months.
But not all those dollars will swell Central’s reserves, as the monetary authority will have to continue to sell currencies to meet market demand for payment of imports and debts. The most optimistic estimate is that at least $3,000 million a month would go this way.
Consulting firm Aurum calculates that at current prices if between 6 million and 12 million tons of soybeans were liquidated, “Net foreign exchange accumulation would not be sufficient to meet the IMF net reserves target for June.”
Aurum estimates that the liquidation of at least 8 million tons of soybeans is needed for the net balance of reserve accumulation to be even minimally positive. With 12 million tons sold, the balance of foreign exchange accumulation would approach 3,000 million US dollars.
“Most likely, without this programme, the situation for foreign currency hoarding would have been worse, but the results do not look encouraging enough to reflect the fragility of the shortcut the government has been taking for several months.” Aurum says.
“Pending, the second quarter is extremely busy. By the end of June, the central bank should have $9.077 billion of net reserves under the new criteria. While this is the most generous period in terms of currency settlement, drought is the big threat,” warns GMA Capital.
“We are likely to see the first waiver for this violation of this performance criterion in June (which conditions the approval of new disbursements)”, they report from GMA.
With the sword of Damocles of a renunciation ahead, the card that remains for the Government is to continue to tighten the tourniquet of exchange: tourism and imports figure prominently among the sectors facing even greater adjustment.
“Despite promoting export liquidation and reducing the external energy and tourism deficit, it would not be sufficient to compensate for the loss of foreign exchange from agribusiness and the increase in net debt. This is why we are still waiting for the Government to announce measures on the import front”, anticipates Equilibra.
AQ
Source: Clarin
