Argentina's soybean crushers pull meal, oil offers as strikes continue

Argentine soybean crushers pulled their meal and oil offers from the spot market as a strike by the oil workers union persisted on Monday, local trade sources told Agricensus.

No offers were shown for old crop soyoil in the FOB Up River hub in Argentina – the world’s largest soyoil and soymeal exporter – as crushers halted operations last week due to the strike and did not want to commit to any new sales.

January shipments were bid at 5.20 ct/lb over the January CBOT contract, equivalent to $970.50/mt FOB Up River, up around $14/mt from Friday’s close.

“With CBOT [soyoil futures] up 50 points, bids are 60 points higher from Friday, but sellers will not show up with this strike. That's why the only offer available is May-June-July shipment,” an Argentine trade source told Agricensus.

Shipments for May-June-July were bid at 1.20 ct/lb over May futures, or $870.50/mt FOB Up River, also up around $14/mt.

“It seems buyers truly need the soybean oil if they're willing to pay it 60 points more, with CBOT up 50 points,” he added.

There were no offers available for old crop soymeal shipments, with a soymeal broker adding that “if the strike continues it will be bullish for the spot market.”

The strikes had already caused losses of approximately $300 million, Gustavo Idigoras, head of the country’s crushing industry Ciara-CEC told Agricensus.

“The industry is really concerned about the negative impact of these strikes. We are urging unions to urgently resume salary negotiations under realistic demands. The industry will not pay salary increases above the inflation rate,” Idigoras said.

Interruptions and talks

After eight straight days of strikes, efforts by the Oil Workers Union (Soea) to halt operations were extended to 1600 local time Monday as no agreement on wages and bonuses could be struck at the end of last week.

“Operations at San Lorenzo and Rosario terminals remain interrupted,” a shipping agency said in a note to its clients late on Friday.

With the outlook of the impact on Argentina’s large soybean crushing sector turning more dire, talks between both sides resumed at 1100 local time Monday.

“Although the meeting raises expectations, workers gave a mandate to their delegates and board of directors to continue [strikes], keeping the oil plants stopped for another day,” Soea said in a statement.

“We expect to have news during the afternoon. Hopefully good news,” a second trade source added.

UPDATE: Adds Ciara-CEC comment.