There is anger among farmers over the Central Bank’s move.
The grain and trade exchanges around the country and the Soybean Chain Association (ACSOJA) expressed their rejection and concern against the decision of the Central Bank of the Argentine Republic (BCRA) to raise the interest rate on loans granted to soybean producers. A measure that it aims to make funding more expensive for farmers and force them to sell cereals kept in a context of great need for dollars by the BCRA.
The measure announced on Thursday raised the interest rate to 83% for all types of credits taken by those producers who have not sold 95% of their soybean crop. This new provision establishesa minimum interest rate of 120% above the LELIQ rate for soybean growers“. As this rate today is 69.5%, the percentage set for soybean producers remains at a nominal annual rate of 83.4%, but the real rate when adding other bank costs is close to 90%, around 20 points more than official inflation.
In Communication “A 7600”, the BCRA board indicated that “it will be applied to all credit lines in pesos, whatever the form of instrumentation, and is complementary to the program launched by the Government so that producers can liquidate foreign currency for the soybean exports at 200 pesos per dollar “.
The Bahía Blanca, Buenos Aires, Córdoba and Entre Ríos Cereal Exchanges, together with the Chaco, Rosario and Santa Fe Bags, have expressed their “total refusal” to the communication issued by the BCRA.
“This measure is totally discriminatory and distorting and threatens the normal development of productive activitiesjeopardizing not only possible investments in the sector, but also access to working capital which this year will be very necessary due to the severe drought that is putting next season’s production at risk “, reads a statement.
“Today more than ever it is necessary to give clear signals towards the futureand for this the stock exchanges ask the authorities of the Central Bank for the immediate repeal of the aforementioned provision“, they expressed.
For its part, ACSOJA said: “We consider it credit is essential for the development of production and discriminating against a dynamic sector will undoubtedly have an impact on production potential “.
For this reason, the soybean sector has asked the Government to “rreverse this measure which harms the development of the interior and the increase in the flow of exports“.