Argentine farmers delay strikes as govt talks on export duties continue

Argentinian farmer lobby groups said Thursday they would postpone potential strike action, including the suspension of grain sales to crushers and exporters, amid reports the government will delay announcing any new tax increases for the export of agricultural goods.

On February 27, Agriculture Minister Luis Basterra met with the four main lobby groups – the CRA, FAA, Coninagro and the Rural Society – to discuss changes to the scheme.

Earlier this week the government shut its export registry for agricultural goods in a move that was seen as preparing for an announcement of an export tax hike on Sunday.

However, following the meeting the registry is now expected to remain closed until the government has finalised its policy,

In the meeting, Basterra said that the government intended to increase soybean export duties from 30% to 33%, something that was opposed by the lobby groups.

“For now, the protest actions would be subject to the new meeting we have with the government and the counterproposal they make us,” local newspaper La Nacion quoted Carlos Achetoni, head of FAA, as saying.

“The current export duties scheme is under analysis and there is not a defined number yet,” CRA’s president Jorge Chemes reportedly said.

The rural entities will meet with Basterra on March 4 to continue negotiations regarding the new export duties as the government tries to head-off an embargo on grain sales that would hit its foreign reserves.

In a bid to appease farmers, the government may offer differential export duties to benefit small producers and lower duties for some specific products, according to the reports.

Inevitable

However, a market source told Agricensus that an increase of 3% in the export duties for soybean was inevitable. “There is a lot of uncertainties around this issue,” the source said.

President Alberto Fernandez is not expected to announce any changes to the export duties scheme on Sunday March 1, in his first address to the national congress, as it was initially expected.

However, Fernandez insisted that the agricultural sector needed to contribute more to the treasury given the weakness of the economy.

“This time the effort must be made by those who are in better conditions. Those who export are the ones with the best conditions,” President Fernandez said

On December 14, the government of centre-left coalition Frente de Todos eliminated floating export duties of 4 pesos per US dollar, replacing it with a 12% duty for corn, wheat, sorghum, sunseeds and barley.

For soybeans, the export duty was increased to 30%.

On December 21, Argentina's Senate approved an economic emergency bill that allows the government to increase Argentina’s export tax for soybeans to a maximum of 33% and for corn and wheat by up to 15%.