The week began with Argentina shaking the grain market by temporarily suspending export taxes on soy, corn, wheat and derivatives.
The goal was to capture dollars to strengthen the Central Bank reserves amid growing market distrust of Javier Milei’s political force. From the financial point of view, the plan was successful-but ended up generating tremendous discomfort between the president and the farmers.
The measure provided for tax exemption by the end of October or until exports added $ 7 billion – a value that was reached in just 72 hours. It was enough time for China, which continues without buying soy from the United States this year, acquired at least ten ships of 65 thousand tons of Argentina, as reported the Bloomberg.
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On Wednesday, the calls withholdings – 26% export tax for soy and 9.5% for corn and wheat – were restored, leaving few beneficiaries and many complaints in the field.
In practice, there was a race for large international tradings to issue foreign sales declarations (DJVE) until the $ 7 billion limit was reached. But that does not mean that exporters have bought the grains during this period, as they have a period of 360 days to board the declared goods.
In these 72 hours, Argentine exporters registered sales abroad of more than 19.5 million tons of grain with the zero tax, according to the Argentine newspaper The nation. As they do not have the whole goods, they will have to buy it now, but with the tax back, which devalues the product.
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The measure left Argentine farmers “with a feeling of bitterness”, according to Coninagro (agricultural intercooperative confederation).
“We understand that the temporary measure was not enough to benefit the first link in the jail: the agricultural producer, who is also the one who assumes the highest risk,” the association said in a statement. “On the contrary, the evidence suggests that it was a window of opportunity and a business opportunity for some,” the group added.
According to a newspaper report The nationseven tradings concentrated 86% of closed exports with zero tax: Louis Dreyfus, Cargill, Bunge, Cofco, Viterra and the places accepts General Deheza and Molinos Agro.
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Milei, who won the elections in Argentina with free trade promises, has seen his support in the field decrease. Producers have been increasing pressure for tax relief, which reduced the competitiveness of Argentine agricultural exports and, consequently, discourage the increase in production.
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