As for the expected situation towards the end of February ($26,650 million), the current expected foreign currency income ($30,650 million) had an increase of almost 4,000 million dollars. Between the rains of the first half of March, with a great recovery of crops, which is now expected to have better production and an increase in exportable balances, and the recovery of international prices, a perfect combination was created that contributed to improving revenues in foreign currency. .
In annual comparison, foreign currency income would amount to 30,651 million US dollars in 2024 and would increase by $2,650 million compared to 2023 (28,000 million dollars). In 2022, meanwhile, revenue was $48 billion.
Where we can find differences this year is in the future projection of foreign currency earnings, in a situation with a high level of uncertainty.
Our projection is a fall in the April-June quarter compared to the same quarter of the previous year. We forecast $2.5 billion for April, $2 billion for May and $1.7 billion for June.
Therefore, the accumulated foreign currency income in the first half of the year shows a very similar figure between the two campaigns: We expect it to amount to $10,722 million this year, versus $11,029 million in 2023.
As we can see, they are very similar figures. What has changed is the distribution of foreign currency payments in the respective months that make up the semester. Today the competitiveness of our country’s agro-export sector and the profitability of Argentine producers.
As Argentina loses competitiveness, producers are seeing how the prices they receive for their crops are doing they are liquefyingtheir purchasing capacity is reduced and the input/product ratio becomes more disadvantageous: the producer must sell more grain to purchase the same input or service compared to the previous campaign.
On this occasion no black swan appeared, nor has there been a sharp decline in markets that could have a negative impact on the income of agricultural producers. On the contrary, international prices have reversed the downward trend that had consolidated over the last 12 months, starting a new bullish rally in the last two weeks, which seems to anticipate a sustained change in price trends. And all this was reflected in the improvement in prices: corn, with 5% profits in quotes in dollars and soybeans, with increases of 7% in available positions and 4% in future positions of new crops.
But these increases They were not enough to offset the decline in the exchange rate known as the 80/20 dollar mix. due to the decline recorded in cash with liquid, nor to compensate for the exchange delay measured as the creeping picket 2%, insufficient to offset inflation.
The dollar’s jump stems from the 118% adjustment the government made to the official dollar on December 12, the first business day after President Milei took office. The highest cash-with-liquid price was reached on January 22 ($1,312.49) and on March 18 it was quoted at $1,070. It accumulated a decline of $242, or 18.5%. In the same period, the official price of the dollar increased by 3.5%. The combination of the decline in the CCL and the rise in the official dollar shows a 2.7% decline in the dollar mix.
As for inflation, in December it was at 25.5%, in January it was 20.6%, in February it was 13.2% and March is expected to be similar to February. Nominal inflation accumulated from December to February was 59.3%.
The multilateral exchange rate (ITCRM) they went from the maximum of 161 (December 12) to 106 today. Regard main indicator of the loss of competitiveness of Argentine exports. The progressive anchoring of 2% per month is not enough to offset the sustained level of inflation.
As a result, agricultural producers their income in pesos is reduced, as there is an increase in the costs of production and dollar goods and services, as a result of the lagging exchange rate and unprecedented dollar inflation.
If this trend continues, Argentina will be an increasingly expensive country in dollars, producers will see their purchasing power increasingly reduced They will have to sell more grains to buy the same amount of inputs or pay for their services, compared to the previous campaign.
With this cost, revenue and expense structure, most manufacturers They have negative profitability.
Unless the Government increases the creeping peg rate (the Government denied a devaluation or something similar), so as to at least compensate for the inflation rate, and the lost competitiveness of our country is improved, we will continue to be a country with export problems and it will be impossible to compete in world trade unless we reduce our export prices, with reductions in the prices that producers will receive.
Another alternative It would mean bringing the dollar mix to 50/50 between the official dollar and the CCL.
Source: Clarin
