RIO DE JANEIRO, BRAZIL – Six years ago, Argentina’s producers, the world’s third largest, harvested 56 million tons. Last harvest, it reached 46.5 million tons, while for the next one, weather permitting, it will amount to 52 million tons, should the USDA (United States Department of Agriculture) prove right.
While Brazil virtually doubled its production in the period to 144 million tons, the same with exports, the endless economic instability of its neighbors has slashed 10 million tons.
Data from Buenos Aires analysts point out that the 33% withholding tax on exports that the Fernández government is imposing, in an attempt to stave off inflationary pressure from international prices, is eroding producers’ profitability. As a result, they have stopped producing.
In the same period, Argentina lost 3 million hectares with oilseed, reaching 17 million last season.
According to last May’s calculations, when the July contract reached a peak of US$16.42 in Chicago and the August reached US$15.72, the ton at approximately US$550 was leaving behind the withholding and the exchange rate loss, with producers receiving US$337 for the price paid in Rosario.
Moreover, exports are being disrupted by dockworkers’ strikes, a very steady trend in the country, which is driving away traditional producers.